Mark's Note (2026):
This post was originally written in 2018, during a period when Elon Musk publicly described Tesla's challenges as “production hell.” The core lesson remains timely: Lean manufacturing is not about maximizing automation or sidelining people, but about designing systems that help people see problems, speak up, and improve work over the long term. Toyota's emphasis on respect for people and disciplined, purpose-driven use of technology continues to offer a valuable counterpoint as new waves of automation and AI revive similar debates today.
Over the past month, there's been so much in the news about Tesla. This column from Joann Muller, who covers the auto industry for Forbes, caught my eye again recently:
“Musk Thinks Tesla Will School Toyota On Lean Manufacturing; Fixing Model 3 Launch Would Be A Start“
It's not a direct quote (I don't think) from CEO Elon Musk that they will “school” Toyota on Lean manufacturing.
What Lean Manufacturing Really Means (and What It Doesn't)
I'd suggest there's little evidence that Musk and Elon are even really trying Lean manufacturing as a strategy or a mindset. He's doing his own thing and will sink or swim accordingly.
Lean Is Not “Lights-Out” Automation
If Elon thinks that “Lean” means automation, he'd be incorrect. There are no “lights out” factories that are “fully automated” in Japan, as some people seem to think. In my own visits to Japan, I've seen Toyota factories that are full of people. The Toyota plants, of course, have some robotics (in welding, painting, and for the conveyance of vehicles and some parts. But, it's said that Toyota plants are generally LESS automated than those of American automakers.
This isn't a new lesson. In the 1980s and early 1990s, Roger Smith, then CEO of General Motors, pursued the same vision of the “lights-out factory.” GM spent an estimated $90 billion trying to automate away complexity and labor–without first fixing its management system or engaging its workforce. The result wasn't world-class manufacturing; it was breakdowns, quality problems, and massive waste. Toyota's advantage was never “better robots.” It was better thinking about when not to automate, and how technology should support people–not replace them.
When the Factory Becomes the Strategy
From the Muller article, published in February, Musk is quoted as saying:
“The competitive strength of Tesla long-term is not going to be the car; it's going to be the factory.”
Well, that factory currently seems to be quite the mess. It's a shame that Tesla couldn't combine a very innovative product with proven car-building technology from Toyota.
Sure, Tesla assembles battery packs and builds electric motors in the plant, but Tesla vehicles are built on assembly lines that don't have to be that radically different than the way Toyota does things.
The NUMMI Lesson Tesla Didn't Learn
Tesla could have used or built upon the management system that used to live (and thrive) under the same roof, when the Tesla factory used to be the NUMMI joint venture between Toyota and GM).
Right or wrong, Musk seems to want to do things his own way… figuring out a better way means the risk that different isn't necessarily better.
Musk also said:
“The car industry thinks they're really good at manufacturing and actually they are quite good at manufacturing. But they just don't realize just how much potential there is for improvement. It's way more than they think,” said Musk, calling the pace of today's auto factories slower than “grandma with a walker….Why shouldn't it at least be jogging speed?”
It's sort of sad that a company that is still struggling so much with what Musk calls “production hell” would talk trash about other automakers who have proven they can build products at scale. Elon's plant is the one that's slow and behind schedule, not meeting production goals.
In the Muller column, she quotes Jeff Liker, author of The Toyota Way and other books in the series as predicting that Musk's vision of an extremely automated factory was folly:
“If he were to install all the robotic equipment to implement his vision, it would be a disaster,” says Jeffrey Liker, the retired University of Michigan professor whose 2004 book, The Toyota Way, outlined the principles of lean manufacturing that have influenced an entire industry. Ultimately, however, Liker believes that disaster will be averted “because smart people around him will discover (his ideas) don't work.”
Back in February, Musk was still bragging about parts conveyance automation (which is a different dimension of automation than robots doing welding or assembly):
“The next constraint” toward full production, Musk said, is a sophisticated automated parts-conveyance system at Tesla's Fremont, Calif., assembly plant, formerly a joint venture between Toyota and General Motors, and a showcase for lean manufacturing techniques in its heyday. Musk called the conveyor system “probably the most sophisticated in the world,” adding that it “appears to be on track.”
Musk, as a smart person, eventually figured this out, as he admitted his mistake about automation:
As I tweeted in response, Toyota never thought humans are underrated. More on that later.
I've blogged about how Musk seemed to be repeating a GM mistake from the 1980s, as this article mentions (and they linked to my post):
“Experts say Tesla has repeated car industry mistakes from the 1980s“
Musk added, on automation:
“We had this crazy, complex network of conveyor belts,” Musk told CBS News. “And it was not working, so we got rid of that whole thing.”
Learning Too Late: What Happens Without the Gemba
So what happened between February and April? Was the conveyance “on track” or “not working?” Did it go from “on track” to “not working” at some point? Or was it never working?
If it wasn't working or stopped working, at what point did Musk learn this? Was he being told by employees and leaders that things were fine? Was Musk not at “the gemba” (in the actual workplace) to observe this for himself? Of course, it's not necessary for a CEO to go confirm what he's being told about the status of “production hell,” not if it's an environment where people are free to speak up about problems.
Anyway, it's good to see that Musk might be learning from some of these admitted mistakes related to an overabundant love for robotics and automation. I mean, he could have learned that lesson from Toyota if he had asked during that timeframe when Toyota was an investor in Tesla.
What Toyota Actually Teaches About Technology
They might have tried teaching him Toyota Way Principle #8:
“Use only reliable, thoroughly-tested technology that serves your people and process.”
Toyota tends to automate just the work that can be done better by robots or more safety by robots. Robots can't help improve the process. Robots and automation should support the people, not completely replace them. At Toyota, “Respect for People” is a core mindset. Is that the case at Tesla?
Respect for People Is Not Optional in Lean
Musk doesn't have to completely reinvent the car assembly wheel in the process of reinventing the car.
More thoughts on Tesla to come on future blog posts, looking (again) at safety, writing “motivational” memos to workers, and the CEO sleeping in the factory…
Related Lean Lessons on Automation, People, and Long-Term Thinking
Toyota's approach to Lean manufacturing has never been about replacing people with machines. Instead, it reflects long-term thinking, respect for people, and the disciplined use of technology only where it truly supports the work. The contrast with Tesla's early automation struggles reinforces a timeless Lean lesson: technology should serve people and processes–not replace them.
Please scroll down (or click) to post a comment. Connect with me on LinkedIn.
If you’re working to build a culture where people feel safe to speak up, solve problems, and improve every day, I’d be glad to help. Let’s talk about how to strengthen Psychological Safety and Continuous Improvement in your organization.
The comments on the Ars Technica piece are interesting.
and
and
Musk isn’t a dumb guy. He seems to be stuck in some cognitive biases, including “I’m smart, so I can figure this out better than anybody who came before me in this industry.”
Musk HAS hired some production executives from the auto industry, including Peter Hochholdinger from Audi. According to LinkedIn, he’s still there at Tesla.
From 2016: Tesla Hires Audi Veteran to Head Vehicle Production
Most of Musk’s confident statements about how great his factory was going to be occurred before he ever had any experience mass producing anything–ie before “production hell”.
In my experience, “production hell” is what we call a normal day in most factories. ;-)
Musk seems to think “production hell” is inevitable…
Interesting Jeff Liker quote:
LinkedIn discussion can be found here:
Mike Geiger wrote:
Great question.
From TechCrunch:
Tesla earnings show record revenues with record losses
The mindset of BMW (Read More):
Comments are closed.