Local Motors: Designed by the Crowd, Built by the Customer

In the wake of the meltdown among US auto manufacturers in 2009, Jay Rogers - CEO of Local Motors - has a new approach for the automotive industry: Decide which models are produced through online design competitions, and then allow customers to "build their own cars" from the winning designs. The case focuses on two key issues: Can Local Motors build a thriving online design community at a reasonable cost? And can customers be convinced to add their own sweat and labor to the manufacturing process? The case is written from the perspective of a start-up company seeking funding while trying to implement a novel business concept.Learning Objective:This case highlights the promises and pitfalls of two increasingly common marketing tactics. First, the case explores the concept of involving consumers and communities in the design of one's products - inviting a broader discussion of similar initiatives such as open-source collaborative efforts. Second, the case examines the impact of involving customers in the manufacturing of one's products - again part of a broader conversation about the increased push towards allowing consumers to customize product offerings.