1. The competition to develop and market electric vehicles has increased during the last year and is expected to continue to increase. The electric bicycle industry has four major manufacturers and a large group of small companies. The major manufacturers are Honda, Suzuki, Sanyo and Yamaha. They mainly sell products to Japan and Europe. The other group of manufacturers is much smaller in size and sales volume. These manufacturers have products they sell into the U.S., European and Asian markets. Porter's five-forces model is a powerful tool for systematically diagnosing the principal competitive pressures in a market and assessing how strong and important each one is. The electric vehicle industry is a definite for applying this technique. These are my observations about the five forces affecting the EV industry: The rivalry among competing sellers in the EV industry is high, with new businesses popping up every year. The barriers to entry for new competitors at this time is low, which is why rivalry is becoming stronger among companies with new companies forming left and right. The threat of substitute products is also high because new technology combined with new and innovative companies has created many product options in the EV industry. The bargaining power of suppliers is the EV industry is low because so many companies exist that create the parts EV markers are looking for. This gives companies more options at finding the cheapest prices for the parts they need. Finally, the bargaining power of customers is high, because there are so many companies out there offering electric vehicles. This allows consumers to pick and choose whom they want to deal with, thus lowering t... ... middle of paper ... ...ns and allow Zap's products to maintain a position of superiority in the EV industry. My final recommendations as far as forecasting would be to utilize both benchmarking and market demographics. When weighing the pros and cons, I find it strange for a company to use one forecasting tool without the other. Benchmarking will help Zap better understand the strategies of competitors. Then they can take the information gathered here and use it in trying to study market demographics for their own industry. Also, I would recommend Zap use the skimming strategy. They don't want to make mistakes that might jeopardize their current superiority. If they were to go with a market penetration strategy, they would be sacrificing quality products to help gain market entry at lower prices, but they don't want their profits to suffer because consumers sense a lack of quality.
The suppliers bargaining power is generally strong because of the big monopolies and the high importance of purchasing components and operating system, therefore it decreases the profitability of the market players.
Degree of Rivalry - Very High to Intense – Multiple competitors, high strategic stakes, innovation often easily imitated, and low switching costs for consumers
...egic alliances with automakers in Japan and in the United States to help fund these charging stations. With a further development of infrastructure, the Nissan Leaf and other electric vehicles will become the future of transportation. Although sales are not what Nissan had expected, with a few changes, Nissan could meet those objectives in the near future. Nissan has very effectively acknowledged the weaknesses and potential threats facing the Nissan Leaf and made valuable changes that will benefit their company in the long run. They have also effectively recognized the strengths and opportunities of the Nissan Leaf available and have taken a competitive advantage over their rising competitors. Nissan has adequately applied a number of changes that will ultimately result in an increase in sales of electric vehicles all over the world, especially the Nissan Leaf.
The substantial increase in the demand for EV’s came just in time as we are slowly but surely running out of oil. Some estimate that by the year 2040, 35 percent of all vehicles will be electric (Sullins, 2017). An article from the U.S. Department of Energy stated that “Electric vehicles hold a lot of potential for helping the U.S. create a more sustainable future. If the U.S. transitioned all the light-duty vehicles to hybrids or plug-in electric vehicles, we could reduce our dependence on foreign oil by 30-60 percent, while lowering the carbon pollution from the transportation sector by as much as 20 percent (energy.gov, 2014). It’s obvious that gas-powered vehicles have harmed our planet with their emissions. Although EV’s cannot reverse that damage that has been done, they can eliminate, or at least slow down, the inevitable demise that our planet is headed towards. Along with the beneficial environmental factors that correspond with electric cars, there are also beneficial financial factors. The average American spends about $2,000 on gas annually. In the future, charging stations will charge roughly $12.00 for a full charge, which is about 300 miles. This means that the average American will save about $1,400 per year on these specific car
In the recent past, Tesla has been noted as a great competitor in the automotive industry. This is attributed to its three huge competitive advantages. Generally, the advantage lies in its ability to bring about innovative disruption in the industry. This include; a strong battery supply chain that is sustainable in itself, a supercharger network celebrated by the customers and a software system several leagues ahead of its competitors (Zach, 2015).
...rther then the end of 2010, the introduction of the electric car is not far to come. With proper government regulations and consumer knowledge, adoptability of the electric car is possible. However, one can drastically differ in opinion as to why the required elements to support such a vehicle were not readily planned to facilitate such a change. The inadequacies draw wavering concerns for both consumers and business looking for the return of value and profit. The larger picture needs to be remembered in which oil is not a renewable resource and results in pollution and environmental hazard. Consumers and business must work together to overcome the roadblocks down the road and support each other in the introduction of and future of the electric car. Adjustments will have to be made on both sides to ensure success and minimize the society and economy disruptions.
Environmental concerns have been raised from time to time because of the dependency on the gasoline-fueled engine as the chief auto powertrain technology. This has resulted in exposing many automobile users to unpredictable prices of fuel. These issues were, however, the reason for the inception of Tesla Motors so as to bring into existence another set of automotive which serves the similar purpose; but uses another form of energy that being electricity to drive them instead of the disadvantageous gasoline-powered engine. This invention was influenced by a number of factors in terms of their planning and performance (Hunger, 2010).
Portfolio Project: Tesla Motors Case Study Tesla Motors (Tesla), founded in 2003 by Elon Musk, is an automotive company focused on enhancing Electric Vehicle market by creating optimum performance, all electric, vehicles for every class of consumer (Tesla Motors, 2015). In order to achieve such ambitious goals, Tesla Motors not only designs, but also manufactures, and personally sells the company’s electric vehicles (Hirsch, 2015). As additional quality assurance, Tesla Motors also designs, manufactures, and sells, electric vehicle power-train components, and battery products (Hirsch, 2015). Yet, despite the pivotal role Tesla’s self curated products play in the success of Tesla’s vehicles, the socially responsible company does not privatize Apart from Musk’s concise vision statement Tesla has a truly inspiring mission statement, “At the core, Tesla Motors believes that electric cars should not be perceived as a sacrificial mode of transportation. Tesla Motors has brought the best of both the automotive and technological worlds together by permanently etching the image of electric cars being a step backwards in performance, efficiency, and design” (Tesla Motors, Chiefly, and most apparently, it is the goal of Tesla Motor to generate demand for Tesla vehicles (Andrade, Holloway, Payne, Roy & Sheffield, 2015).
I choose to do the porter’s five forces analysis over the automotive industry. But before I start talking about the automotive industry I would like to talk about what the porter’s five forces model is and what it does. “The porter’s five forces model is a tool for examining the industry level competitive environment, especially the ability of firms in that industry to set prices and minimize costs” (McNamara, 2012). This model describes the competitive environment in terms of five basic competitive forces. “These forces are: the threat of new entrants, the bargaining power of buyers, the bargaining power of suppliers, the threat of substitute products and services, and the intensity of rivalry
The number of suppliers available for each input drives the bargaining power of suppliers. More the suppliers, lower would be their bargaining power.
The bargaining power of suppliers is very low. Major players are vertically integrated for example KKD is producing their own equipment while others are partnering up with suppliers.
the price of the vehicle, the company gives these individuals a vision of even greater power and
Ford Motor Company's Global Electrification Strategy. Business Economics, 46(3), 167-170. doi:10.1057/be.2011.10. Knox, J. (2011). The 'Standard' of the 'Standard'.
Well-designed electric vehicles, like those produced by major auto companies, travel at speeds equivalent to conventional vehicles and offer all the same safety and high-performance features. Lower Operating Costs The per-mile fuel cost of operating an electric vehicle can be less than one-third that of a gasoline-powered car. The exact amount of savings depends on the local electricity rate, which varies from utility to utility. In addition, electric vehicle owners say goodbye to many familiar maintenance costs–no more tune-ups, oil changes or muffler replacements. No Gas Stations One of the conveniences electric vehicle drivers like the most is that “refueling” can be done easily and safely at home overnight, at work, or at public locations like shopping centers, where electric charging units have been installed.
In this case study I will be discussing advantages and disadvantages of electric cars. Electric cars are cars that are powered by electricity. Electric vehicles are an important part of cutting emissions and reducing global warming. The battery of an electric car stores electrical energy. The electric motor is coupled to the wheels through gears; it converts 59-60% of electrical energy into the wheels. The battery runs the motor which allows the car to move. Electric cars are necessary as they will save money, because electricity is cheaper than gas. Also electric vehicles will help reduce global warming and pollution. However, some people say that electric cars still have environmental costs. The electricity used to recharge EV batteries has to come from somewhere in the world, and now, most electricity is generated by burning fossil fuels. Although electric vehicles are classified as green cars, purists will not appreciate the toxicity of the batteries.