Abstract
As the electric vehicle industry prepares to make the transition from niche to volume applications, so it is apparent that the traditional automotive industry value chain is insufficient to the task. The successful production, sale and use of electric vehicles on a large scale demands that the industry look beyond traditional boundaries to create new value added configurations. In this perspective, electric vehicles are not simply another technology that can be folded into the existing way of doing business for the automotive industry. On the contrary, this paper seeks to show that the mass adoption of electric vehicles will bring new ways of creating and capturing added value. The growth of the electric vehicle sector is unlikely to be entirely monopolized by the existing major vehicle manufacturers, although it is entirely reasonable to expect that their overall preeminence will be preserved as the entities with the technological capability, brand reputation and marketing knowledge and structures to build and supply electric vehicles to customers. It is concluded that about designing product and mobility offerings to achieve market acceptance in the face of levels of fragmentation and turbulence unprecedented in the industry. Risk aversion may not constitute a viable strategy in these circumstances, but neither are there simple solutions to be applied.
Highlights
Innovative added value configurations and the extended automotive industryAs a consequence of the above forces, the conditions are right for an extended automotive industry with multiple stakeholders to be brought into new and constantly re-shaping added value configurations, including circular value creation systems
Every industrial activity can be understood as an characteristics of the automotive industry business economic structure through which materials are model as it applies to contemporary mass production
The predominant automotive institutional arrangements both within the industry business model has its foundations in the boundaries of the firm and beyond whereby value is emergent mass production industry of North added or created, and captured
Summary
As a consequence of the above forces, the conditions are right for an extended automotive industry with multiple stakeholders to be brought into new and constantly re-shaping added value configurations, including circular value creation systems. New added value configuration offerings more akin to mobile telephones, internet businesses, or budget airlines are emerging around electric vehicles which are potentially sold as packaged product-service systems and ‘usership’ models. It may be the case that new entrants come between the vehicle manufacturers and their customer base, such that in effect a new business model is imposed on the industry even where the industry does not want that model or benefit from it. These two scenarios are examined in turn
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