MANAGEMENT CASE LET FOR MANAGEMENT STUDENTS ON BUSINESS STRATEGY.

 

Case Let: Global EV and Indian EV Manufactures.

What the Indian EV Manufactures can learn from the Global EV Manufactures:

 

Picture Courtesy: Life Style Asia.

BYD (Build Your Dreams) and Tesla appear as the biggest players when it comes to electric vehicles (EV), however, both companies thrive in totally different sphere with different business models. Yet here are their approaches, as well as factors for which BYD and other Chinese electric vehicle manufacturers could take over the world market in due course.

 

1. Cost Leadership:

 BYD: The cost advantage is what separates BYD from Tesla. BYD caters for a different base when it comes to the manufacture of its EV, producing lower cost EVs. They have a vertically closed system, which implies that they produce their batteries, microelectronics, and other relevant components that significantly cut down the expenditures. Because of this they are able to sell lower priced EVs in the market as opposed to what Tesla does.

 Tesla: However, a large majority of potential buyers of Tesla vehicles are restricted by quite high initial prices attributed to what can be defined as ‘premium positioning’. Tesla’s activity is targeting high-end models equipped with up-to-date technologies and therefore their price range is high, however, they tend to face challenges in emerging markets where affordability is the driving force.

 2. Technologies and manufacturing of batteries:

 BYD: BYD has capacity to advance battery technology. Instead, they manufacture Lithium-phosphate Blade batteries, which are low-cost and safer than other automobile manufacturers’ lithium-ion batteries. Hence, they have an advantage over the competition with respect to safety and durability.

 

Tesla: In addition, Tesla is also expanding its distribution capacity through the construction of Gigafactories worldwide, however, other issues like supply chain interruptions and bottlenecks in production persist. It is evident that most of Tesla operations focus on high-end markets where these operations may not be scalable in low-cost regions.

 3. Governmental and Market China Support:

BYD: The Chinese government has heavily invested in its home EV market through subsidies to encourage it; investment in more and more infrastructure, such as charging stations; and forcing homegrown carmakers to produce enough electric vehicles. As a result, China has become the world's largest car market by using homegrown manufacturers like BYD. Long-term Chinese government priorities continue to force local manufacturers to innovate and expand globally.

Tesla: There has been a great deal of momentum in China for Tesla, yet it seems far behind the host government's support as a foreign firm, not to mention BYD and other Chinese brands. Moreover, the competition is extremely intense because of numerous local players that are emerging.

4. Production Capacity and Scalability:

BYD: This high and large production volume in China helps BYD to manufacture the car on scale and expand rapidly. These are not merely passenger vehicles, but they are producing buses, trucks, and other commercial EVs, which makes them legitimate and strong contenders in the market.

 Tesla: The Company is expanding its operations at Gigafactories around the world but is experiencing bottlenecks because of supply chain constraints and production limitations. Tesla cars are more premium in nature and may hold fewer prospects for expansive scalability in cost-sensitive regions like India, South Asia, South East Asia and MENA.

 5. Global Expansion Strategy:

 BYD: Value Expansion. Emerging Europe, Latin America, and Asia- all new markets where BYD wants to extend its footprint. Their strategy is centered on affordability & reliable battery technology, hence are likely to perform well in emerging markets where the appetite for cheap EVs is on the rise.

 

Tesla: The latest an expansion into new territories is the, which has primarily revolved around developed economies such as the U.S. and Europe has been witnessed at Tesla evaluates its growth escapes. However, while making inroads into China and India, once Tesla has positioned, the company in the high-end market which is likely to limit Tesla’s capacity expansion in new and developing markets where price and affordability is the key factor.

 6. Product Diversification:

 BYD: Beginning from basic cars to expensive ones, BYD provides a variety of electric cars and commercial hitherto electric powered buses. This varied product approach for them facilitates penetration to different markets in the EV industry.

 Tesla: Tesla on the other side has a bit more consolidated approach to the model’s portfolio which still consists of high-end and mid-range.

They didn’t use the Mg strategy for the promising models introduction on the market, nor did they make any effort to promote lower-cost vehicles, which are actively promoted through

 BYD’s   diversity across various price brackets and types of vehicles.

 Tesla: Tesla offers a narrower product list with its vehicles classified into premium and mid-range categories. Even though they are venturing into new areas with trucks (Cyber truck) and cheaper models, the diversity available with BYD in terms of price and type of vehicles is still missing in them.

 Competitive Advantage of Chinese Manufacturers:

BYD and Other Chinese EVs: The Chinese electric auto  manufacturers, BYD, NIO, Xpeng,  https://www.byd.com/en , https://www.nio.com/, https://www.xpeng.com/

 amongst other is relatively treading mare innovation red oceans. With some aid from the government and advanced technology coupled with cheap production mechanism they have competitive advantages at these rising economies that are very fundamental in sustaining their growth pattern. The matter such as data and affection tech specially AI in regard to vehicle highly performance also supporting expansion of user experiences are utilized to such cases therefore optimizing business value.

 There is a possibility that Chinese EVs Could Command of the Future Market:

 Chain’s massive Domestic Market with rising per capita income. The proportion of the population of China is1.4 billion has made China the largest car market, and China is further ahead in the transition to electric vehicles. Occupying the domestic a lot enables local brand EV producers to get rapid expansion and further build up their competence to a level higher than that of competitors.

 Here are three discussion-provoking questions for your management students based on the case study:

1. Cost Leadership & Competitive Positioning:
How can Indian auto manufacturers like Tata Motors Ltd. and Maruti Suzuki adopt a cost leadership strategy, just like BYD, to be competitive in the global EV market while responding to the price-sensitive Indian market?
2. Technological Innovation & Battery Development:
The following may be done by Indian manufacturers: Raise the country's battery technology, semiconductors, AI, Supply chain and production process to that of Tesla and BYD, since in India the infrastructure is scarce and so are cost-effective yet reliable batteries?
3. Global Expansion Strategy:
How would Indian automobile manufacturers differentiate their EV offerings in emerging and developed markets as they prepare for global expansions? What lessons might be drawn from BYD's own affordability-driven expansion into Latin America, Asia, and Europe and how may these lessons find reflection in the strategies of Indian EV manufacturers?