Creating New Industries with John D Rockefeller and Tesla

Tuesday - June 20 2023, 00:02 UTC - 1 year ago

John D Rockefeller's Standard Oil and Tesla are using vertical and horizontal integration to create entire new industries. This is done through science to engineering, engineering to products, products to business, business to scaled industry and the scaling of markets and supply chain. Standard Oil achieved its goal of controlling the oil industry and Tesla is doing the same with an electric economy.

John Rockefeller and Standard Oil created a new oil based economy. There are a lot of similarities with what Elon And Tesla are doing. Rockefeller was laser focused on reducing costs and waste. Rockefeller used a lot of vertical and horizontal integration to reduce costs.

Deep Technology like nuclear fusion, molecular nanotechnology and reusable rockets will create entire new industries. This is an opportunity and many challenges. It is important to look at the historical creation of foundational giant industries and supply chains. There are also more recent examples of the creation of the internet, electric cars and nuclear fission power.

There are puzzle pieces and steps to create an entire industry and a new economy: .

1. From Science into Engineering .

2. Engineering into Products .

3. Products into Business .

4. Business into scaled industry .

5. Making the scaled industry involves scaling markets and supply chain .

Here is how John D. Rockefeller (Standard Oil) created parts of the oil industry and dominated the oil industry broken into the Industry creation steps. Tesla is creating a new electric economy with Master Plan 3. It is also useful in analyzing how potential new technology like nuclear fusion, AI and reusable rockets could become successful to create new industries.

1. From Science into Engineering.

Standard Oil developed new chemistry to develop oil cracking, creating oil byproducts and various aspects of refining. A refinery is a production facility composed of a group of chemical engineering unit processes and unit operations refining certain materials or converting raw material into products of value. Copper Oxides were used to remove sulfur from Ohio oil. Standard Oil pioneered the process of treating the wood in a kiln to prevent leaking. Standard Oil developed a kerosene that could be produced with 20% of the sulfuric acid used by competitors, thus greatly reducing costs of production.

Tesla developed and pioneered new steel alloys. These are used to enable single large part casting in new gigapresses.Tesla is developing new battery chemistries. They have been developing the dry electrode process which they originally purchased from Maxwell Technologies.Tesla has been developing AI for self driving and driver assist.

2. Engineering into Products .

Standard Oil built 90% of the refineries at its peak. They made more efficient and larger. Oil was refined into kerosene and then into lubricating oil, gasoline, tar and paraffin.

Tesla has take software and engineering to enable new products and improved factories.

The electric grid is the largest and most complex machine ever built. It’s an amazing feat of engineering providing reliable, safe, and on-demand power. This grid is built on 20th-century technology with large, centralized generation, mostly fossil fuel-based and only a few points of control. Replacing it with solar, wind and batteries is a huge and complicated challenge. There is the first challenge of making the new systems cheaper and more profitable but also more reliable. There is a lot of engineering and products needed for this.

In 2020, Tesla Autobidder was launched. It is a product that allows utilities and businesses to save money through automated renewable energy usage.

3. Products into Business .

Standard Oil's business strategy was to charge prices that the independent refiners could not keep up with. The competition of these cheaper oils forced other refiners out of business. Standard Oil was able to repeat this strategy over and over in various locations, allowing it to dominate the oil refineries.

Tesla has created a brand with cars, solar, storage, and energy services. They are creating a business of a full ecosystem of products. There has been a rapid expansion of Tesla's Supercharging network, making more markets available and broadening the company's coverage. Tesla has also expanded its service centers, offering integrated service and repair, with Tesla providing its own parts.

Tesla is also starting to produce and sell insurance products from their cars. This will be a large market in the future, especially with the advent of autonomous driving. Tesla is also producing batteries that will enable new electric grids, and is looking to expand into autonomous air taxis, double deckers, and high speed transit.

4. Business into scaled industry .

Standard Oil's vertical and horizontal integration was accompanied by an enormous amount of acquisitions and mergers. Over the course of 15 years, Standard Oil controlled over 90% of all oil refining capacity and over 85% of oil production in the United States.

Tesla is currently ramping up production on its Gigafactories. These are where batteries, cars, and energy products are created. Through vertical and horizontal acquisition, production will become even more efficient.

Tesla is also rapidly expanding its workforce, so it can create new products. It is also looking to expand its presence in foreign markets, by creating new support centers, setting up service stations, and creating partnership overseas to make sure that it can make more products and launch more services internationally.

5. Making the scaled industry involves scaling markets and supply chain .

Standard Oil began to dominate the oil industry by strictly controlling the market and creating a reliable supply chain. It used its technology and size to create a thriving industry that was competitive and efficient.

Tesla is globally scaling its presence through partnerships and markets. It is partnering with local and national governments to expand charging networks and lower costs of installation. It is also utilizing autonomous driving, to create new fleets of Tesla cars, buses, and air taxis.

Tesla is also scaling its supply chain by building factories and creating new products. This is to reduce costs of production and ensure a reliable source of supplies.