Question

Below is a chart of Global Electric Vehicles Sales from 2010-2018.

Based on the industry life cycle model, which stage is the electric vehicle industry currently in, and why? If you are the CEO of an electric car company, how would you compete in this industry at this stage?

2 500 000 2018 World Share 2,2% GLOBAL PLUG-IN DELIVERIES BEV & PHEV - Light Vehicles 2 000 000 64% Other Sweden South Korea Canada France Japan UK Germany Norway Global BEVs 1 500 000 61% USA 1 000 000 46% China 500 000 69% 55% Y-O-Y Growth 66% 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 EV VOLUMES.COM

Answer 1

Based on the diagram it is evident that Global Electric Vehicles are in the growth stage of the life cycle.

As a CEO of an electric car company,

a) I would aim to maximize my profit by capitalising on the growth stage. This is done by keeping price as high to the extent the demand doesn't get affected.

b) Try adding new features to the product such as battery life and battery standby time and easy charge options, digital meter with navigation features and make the Product unique in the market.

c) Improving the quality of the current products.

d) Improve my distribution by adding new distributors and add new marketing techniques to lure the customers.

e) Also I would use skimming strategy wherein the Product is initially priced higher and slowly and gradually reduced to make good the demand of the growth stage.