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Case Study

Endgame for the automobile industry?

By Goutam N. Challagalla, Ivy Buche and Tasadduq A. Shervani

12 pages

December 2016

Reference: IMD-7-1855

The automobile industry has been shaped by several inflection points, each signaling a dramatic shift. Since the turn of the new millennium, it has been caught in a wave of radical transformation. For auto majors, it is no longer about pursuing sales growth and higher margins through scale, international expansion and outsourcing. The very definition of what it means to be a car manufacturer is being challenged by four mega trends that are transforming the entire automotive ecosystem: (1) the rise of electric vehicles, (2) car sharing as the new form of ownership, (3) mobility as a service, and (4) connected and intelligent cars as a precursor to autonomous vehicles. These trends bring opportunities and threats that automakers have never encountered before. They are looking for ways to get in front of these trends, rather than being caught on the back foot with their business model disrupted. How should they respond? Can they form the right partnerships and innovative alliances to ride out the turbulent shifts?

Learning Objective

Identifying the disruptive changes in an industry. How can traditional companies deal with ongoing industry shifts? Jumping the S-curve requires unconventional thinking in addition to traditional business wisdom.

Keywords

Technological Change, Business Model Innovation, Electric Vehicle, Car Sharing, Mobility, Industry Transformation, Autonomous Vehicle

Settings

World/global
Automotive, Automobiles
2016

Type

Published Sources

Available Languages

English

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