Global Team Assignment (gta)
Table of Contents Executive summary – 446 (Need Tesla)
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- Industry Overview (Total Section 2137) (329)
Table of ContentsExecutive summary – 446 (Need Tesla)While environmental protection and sustainability issue have become the focus and major concerns in most of the countries in the world, the air pollution resulted from automobile emission is also becoming a significant issue to be resolved. With such forward-looking view, Tesla and BYD have started their adventure in electric/new energy car sector nearly a decade. Bearing the expectations from the nations and the environmental protectionists, both BYD and Tesla are entitled to tremendous resources and first mover advantages that the other competitors have no access to. This paper aims to evaluate the difference in corporate strategies between the two companies, one from the developed region and the other is from the developing country. We wish to learn from our analysis below how BYD and Tesla achieve their leading status in different regions today. From our analysis, we see how BYD uses its strong base in battery manufacturing to support its research and development in the electric car models. We also see the constant support from the Chinese government towards BYD, which demonstrates the government’s determination on eliminating the severe polluted air in major cities in China. While BYD is still searching for the stable technologies in its car components and battery manufacturing, Tesla as an international car manufacturer offers superior technology safety to the consumers. Like BYD, Tesla as the pioneer in the electric car market has created a high entry barrier to the other competitors, and the stability of its research and development capabilities has brought Tesla to the next level among its peers. Despite the high production costs as shared by BYD, Tesla has thrived through the use of US government subsidies as well as significant international demand. Unlike BYD, which is still considered a local Chinese car brand, Tesla has escalated itself to the international market place and has drawn the attentions from all over the world. While the prospect of BYD and Tesla is considered bright and promising, the arising number of participants who are making efforts to enter into this developing market is a threat to BYD and Tesla even though both firms are currently enjoying their first mover advantages. More and more international car manufacturers are looking into the entry point to the electric car sector and are eager to explore its potentials such as Toyota, Nissan, Ford and GM. While BYD and Tesla are trying hard to maintain their competitive advantage, the competitive ability of facing new market players is a key future direction for both of the companies. We believe that the continuous improvement on its manufacturing technologies and the reduction of manufacturing costs are two of the most important subjects to be evaluated by BYD and Tesla. We also understand that while electric/energy car sector will always be a market with large demands, the ability to distinguish themselves with other market participants will also be a competitive advantage for BYD and Tesla to think about. [Leave for further revision when Tesla recommendation is prepared] Industry Overview (Total Section 2137) (329)Figure 1: Vehicle Ownership Projections The automobile is one of the most diverse and crucial drivers of the modern economic market. A world without automobiles today cannot be imagined, yet it has its issues. With the developing regions economies growing in an even faster tempo, so is the automobile market. Various sources state the global car sales will grow exponentially in the coming decades with no sign of slowing. As such, auto manufacturers are faced with increasing demand for a growing population as oil and petroleum resources begin to reduce. 
According a Boston Consulting Group study, the BRIC (Brazil, Russia, India & China) Auto markets are some of the regions with an extremely fast growth, mainly China[PRN10]. One of the main reason is the GDP per head is rising sharply, their populations are getting more capital and are obtaining the ability to buy an automobile, and with the automobile become more productive and continuing to increase economic output. 
Figure 2: BRIC Vehicle Assembly Projections In developed regions, however, the car is a luxury product that most of the population can afford, whether in the first or secondary markets, most own at least one vehicle. In this region, the industry can be split up in three segments: Original Equipment Manufacturers (OEMs) - The big auto manufacturers produce some of their own parts, but they cannot produce every part and component that goes into a new vehicle. Companies in this industry manufacture everything from door handles to seats. Replacement Parts Production and Distribution - those replaced after the purchase of a vehicle. Air filters, oil filters and replacement lights are examples of products from this area of the sector. Rubber Fabrication - This includes everything from tires, hoses, belts, etc. [Inv14] Globalization is a huge factor affecting the auto market. Most different brands of automobiles can be found in most markets (developed as well as developing). The monopoly of the local brands is gone, mainly due to the mergers and joint ventures of most traditional automobile manufactures. Download 2.88 Mb. Share with your friends:
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