Mirroring hypothesis and integrality: Evidence from Tesla Motors

Viewing the relationship between vertical integration and product architecture as the “mirroring hypothesis”, we examine the case of Tesla Motors. Our analysis demonstrates that, by and large, Tesla pursues a high degree of integrality in product architecture and employs significant vertical integration. Such congruence offers support for the mirroring hypothesis in the introductory stage of the electric vehicle industry. Besides dedicating an idiosyncratic architecture to battery issues and customers’ range anxiety, Tesla tailors its organization and strategy to mesh with the demands of its other key stakeholders in the larger electric vehicle ecosystem by gradually mastering an effective systems integration.