Even though the automobile industry is one of the leading sectors of the world, companies have been facing serious problems due to new regulations introduced by the government and the increasing competitions from rival firms. An innovation in the manufacturing and designing of vehicles become indispensable in this context. Hybrid cars are an excellent option for innovating the product model. This report elucidates the reasons and benefits of the idea along with proposing a business model, critical success factors an feasibility of the same.
Hyundai should launch hybrid motorcars for securing a sustainable future in the market. engines running on internal combustion will soon see its end as per the government announcements that mandates the use of manufacturing materials that are less taxing on the environment. As of 2018, the frequency of zero emission vehicles (Shaheen, Cohen & Jaffe, 2018) has gone up on the roads. The government’s regulations that limits the sale and usage of cars that is powered by internal combustion propels an innovative stance of automobile industries. President Bush signed an agreement in 2005 to provide huge tax relief to hybrid car buyers, due to the political and ecological pressures around the world to reduce the emissions of greenhouse gases.The tax incentive varies by model. They must manufacture hybrid and electric vehicles that are both cost effective and eco-friendly. Moreover, the consumers are keen on increasing the efficiency of the vehicle and the company must cater to the preferences of the consumers for maintaining brand value. Fuel-powered cars are often not as efficient as electrically charged ones and they are also reported to be more prone to damage than hybrid vehicles. Skilful driving is also an issue among the young crowd. Since hybrid cards can easily accommodate automatic gearing, making things easier for the driver, they appeal more to the young crowd who may not be as efficient in driving in the city.
The environmental damage and the rising cost of fuel has led many car owners and new buyers are looking for alternative ways to save money. The supply of fuel is finite and gad price has been on the hike since ages. The manufacturing cost of fuel-powered cars is too taxing on the company’s resources, and equally heavy on the consumer’s pocket. The popularity of hybrid cars in recent years is due to its lower cost of production and new hybrid car technology, which is being developed and researched upon over the past decade. Owning a hybrid car is affordable and it saves gas (Richardson 2013). These vehicles are designed to combine the cleaner energy of an electric motor with a long range capacity of a gasoline engine allows a hybrid car to save as much as 30 miles gallon. Hybrid cars also help reduce noise pollution since they are mute when stationary and less noisy while in motion as compared to other cars. Hybrid cars emit lower toxic emissions (Milo et al., 2014) compared to conventional gasoline-powered cards due to less gasoline being burned. Instant torque is another benefit of these cars. The horsepower and torques associated with some hybrid cars make the drives extremely pleasant, given their relatively modest output. Many hybrids are constructed using lightweight materials, so they don’t consume as much energy as their full weight counterparts. The higher resale value of hybrid vehicles makes them more desirable to buyers (Bradley and Al-Alwai, 2014) Hybrid cars are decked out with top technology (Mauser et al., 2013), they are renowned to be featured with the latest and greatest technology both under the hood and inside the cabin. Apart from gas savings, hybrid cars is also favorable for maintenance savings. There is a lot of wear and tear items that typically can break down on gas. the first of which is the starter because the electric motor for starting the gas engine, there’s no need for a vehicle tab of starter. Second is an alternator, the hybrid system regulates all the electricity through the vehicles so there is no need for an alternator.
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Key Partners Charging network partners Parking locations vary from hotels to garages. Marketing agencies Hardware companies |
Key Activities · Establishing a new standing in the field of automotive services · Designing automobiles that is designer friendly. · Improving the services over time with new, exclusive software updates. · Innovative design that is as efficient as it is stylish. |
Value Proposition · Fastest accceleraction · Long ranges · Newly designed models · Can be charged anywhere · Service adheres to latest techniques · Availability of wall connector for fast charging · Provision for autopilot for fast and stress-free driving. · Safe and eco-friendly |
Customer Relationships The customer relationship is managed with the help of : · Social Media · Customer Feedback · Customer support (Hong, & Fauvel, 2013). · Test driving · Smart alerts · System monitoring · Software updates · Remote diagnostics · 24*7 service available for 365 days |
Customer Segments · students, office goers · Eco-conscious and safety conscious people · The middle class · Amateur drivers |
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Key Resources · Engineers and hardware developers · Cost efficient devices like dual motors (Lajunen, 2014) · Unconventional thinkers who think out of the box · Raw materials like graphite, cobalt and lithium (Diouf and Pode, 2015). · Batteries and chargers (Krein and Yalmaz, 2013) |
Channels · Website · Sales network (direct) · Car dealerships (self-owned) |
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Cost Structure · Office expenses (showroom staff, electricity and infrastructure) · Software and hardware development · Transport expenses for delivery · Pioneering technology · ICT · Marketing · Promotion · Sales and services |
Revenue Streams · Advertising costs (Kiel, 2014). · Vehicle sales · Maintenance plans · Sales of wall connectors |
The hybrid car will be modeled on new innovative design using latest technologies with the cost efficient and technologically advanced resources. The official website of the company will be the main channel of consumer contact while the sales network will perpetuate business growth. Unique features like auto-pilot, fast acceleration and flexible charging systems will be the value proposition both for the company and the product (Fink and Weyer, 2013). The target consumer base would be people who are conscious about the environment and run on a tight budget. Hardware companies and market agencies could be the key partner of the company for manufacturing and selling hybrid cars.
Simplicity in strategy management implementation- The inexorable link between strategy and governance while execution and during planning makes the alignment of the two crucial components of business essential to success. For building strategic expectations that are realistic, the governance has to exist first before it is aligned with planning. The governance of the company’s management should address things like metrics and measurements, project planning, master scheduling, plan rejuvenation and accountabilities (Hill, 2017).
An analysis of current scenario before future planning- The tendency of organizations to jump into future planning directly without examining the current affair of things is a very common mistake they make during strategic planning. Once the business ecosystem have been fully comprehended after conducting an analysis of current-state, it becomes easier for strategic planner to identify the shortest route to reach their objective. This path to success relies heavily on the understating of the company’s value proposition, core values, culture, competitive environment and organizational structure. For ensuring growth, planning should be based on the gap identified during the comparison between the observed challenges and the organizational structure.
Implementing strategy through change management program- one of the major reasons why organizations struggle with proper execution lies with their failure to manage change. Not involving the employees during the occurrence of the planned transformation could be a reason for such failures since some complicated plans and changes are executed too ambitiously and randomly so the workers are made aware of the changed plans only during its execution. After the development and approval of a strategic plan, the organization must follow up with thorough communication so the employees are informed of the strategies and they (the strategies) are less prone to failures.
Strategy alignment with business processes, mission and operational tactics- the marketplace consumers of an organization will never understand the business unless an organization succinctly explains the nature of their business, the services they provide and the exclusivity of those services. The statement of an organization’s mission should therefore be defined in broad and precise terms so that it has enough rooms for maneuvering and yet be purposeful and direct in their definition of the served markets and the kind of services provided. The planning in operational level should describe executional tactics and correlate action with strategy. Since companies tend to skip the step of operational planning and fail to focus on details, they run the risk of misalignment. The activity affects resource plans, business processes, schedules and infrastructure, therefore it has a crucial alignment with budgets. It further impacts marketing and sales by having downstream consequences on them.
Identifying the customer base- The key factor to understanding business profitability is identifying the potential consumer base of the provided services. Understanding customer requirements, needs and expectations from the consumer’s rather than the business owner’s standpoint is necessary. As already mentioned, the consumer base for hybrid cars are people conscious about the environment and have a limited budget for purchasing a car.
Team requirements- One of the most indispensable element of an efficient business team is having a reliable and honest adviser or a mentor who will guide in the initial and former stager of the business. Even if an entrepreneur starts unaccompanied and solo, the business will require a professional expert to help in the strategic planning of the different facets of the business’ specialization.
Growth potential- different business have different potential for growth depending on the kind of available services and product specialization. For maximum growth rate, the entrepreneurs of the company must be fixated on where they want to see their business and chalk out plans accordingly. Electronic vehicles are quite in vogue these days and all it requires for the company to boost up sales rate is to reach out effectively to the target audience and introduce some innovations in the models. The market reports of car purchase indicate that the growth potential of hybrid cars industry is strikingly high (Gao et al., 2018).
Gathering resources- The conversion of an abstract idea to a concrete business requires whole lot of resources apart from effort and hard work. Making a list of the key asset requirement, the essential resources and associated costs will help the organization determine the crucial resources that are required for manufacturing the product. Car manufacturing involve bulk of resources although the raw materials that goes into the manufacturing of hybrid vehicles is comparatively low than the expensive resources required for fuel-driven cars. Once the resources and the costs associated with it is sorted out, it would be helpful for the company officials to estimate the total cost of investment and hence, comparative feasibility.
Evaluation of services or products- For assessing the consumer behavior and purchasing habit of consumers in the market, it is important to understand and know the purpose of the services provided and the products manufactured by the company. There are similar brands specializing in hybrid vehicles in the market, if would benefit the company if it differentiates the product in terms of target audience and purpose. Hybrid motorcars have a unique, rather noble purpose. It reduces C02 emissions in the atmosphere and hence is a noble step towards environmental conservation and protection. For appealing to different target audience, the cars can be geared with special features like regenerative breaks and automatic pilot system.
Conclusion
The discussions of the report reveals that manufacturing hybrid cars will be a massive benefit for the company and ensure a considerable boost in sales and an extended customer base. Additionally, it may also have improve the brand value of the company. The evaluation of the idea along with the critical success factors must be taken into consideration before planning the innovation.
References:
Al-Alawi, B. M., & Bradley, T. H. (2013). Total cost of ownership, payback, and consumer preference modeling of plug-in hybrid electric vehicles. Applied Energy, 103, 488-506.
Calabrese, G. (Ed.). (2016). The greening of the automotive industry. Springer.
Denton, T. (2016). Electric and Hybrid Vehicles. Routledge.
Diouf, B., & Pode, R. (2015). Potential of lithium-ion batteries in renewable energy. Renewable Energy, 76, 375-380.
Ehsani, M., Gao, Y., Longo, S., & Ebrahimi, K. (2018). Modern electric, hybrid electric, and fuel cell vehicles. CRC press.
Fink, R. D., & Weyer, J. (2013). Interaction of human actors and non-human agents. A sociological simulation model of hybrid systems. Science, Technology & Innovation Studies, 10(1), 47-64.
Frieske, B., Kloetzke, M., & Mauser, F. (2013, November). Trends in vehicle concept and key technology development for hybrid and battery electric vehicles. In Electric Vehicle Symposium and Exhibition (EVS27), 2013 World (pp. 1-12). IEEE.
Hill, T. (2017). Manufacturing strategy: the strategic management of the manufacturing function. Macmillan International Higher Education.
Lajunen, A. (2014). Energy consumption and cost-benefit analysis of hybrid and electric city buses. Transportation Research Part C: Emerging Technologies, 38, 1-15.
Lajunen, A. (2014). Energy consumption and cost-benefit analysis of hybrid and electric city buses Hareuveny, R., Sudan, M., Halgamuge, M. N., Yaffe, Y., Tzabari, Y., Namir, D., & Kheifets, L. (2015). Characterization of extremely low frequency magnetic fields from diesel, gasoline and hybrid cars under controlled conditions. International journal of environmental research and public health, 12(2), 1651-1666.. Transportation Research Part C: Emerging Technologies, 38, 1-15.
Millo, F., Rolando, L., Fuso, R., & Mallamo, F. (2014). Real CO2 emissions benefits and end user’s operating costs of a plug-in hybrid electric vehicle. Applied Energy, 114, 563-571.
Richardson, D. B. (2013). Electric vehicles and the electric grid: A review of modeling approaches, Impacts, and renewable energy integration. Renewable and Sustainable Energy Reviews, 19, 247-254.
Shaheen, S., Cohen, A., & Jaffee, M. (2018). Innovative Mobility: Carsharing Outlook.
Yilmaz, M., & Krein, P. T. (2013). Review of battery charger topologies, charging power levels, and infrastructure for plug-in electric and hybrid vehicles. IEEE Transactions on Power Electronics, 28(5), 2151-2169.
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