Very interesting comparison on the vertical integration. Thanks Michael Sura'. It comes to my attention that in 2020, the total sale of BEV of BYD is less than 60k. This means the existing Tier1 has no incentive to work closely with BYD on the NEW design. The existing design for ICE may work after little customization. But affordable, I agree with Elon Mask, NO. So if BYD is serious on the affordable BEV, you get to depend on yourself instead of incumbent Tier 1. Once the total production is more than 2m, 3m, or whatever, just like GM spined off Delphi. BYD may do the same. It is just economics.
ARUSCON - Strategies, analysis, and consulting in the fields of energy, transport, electric vehicles, batteries, and hydrogen.
👉The power of vertical integration. 💪 👉Vertical integration, in principle, enables a company to control various aspects of the supply chain, manufacturing process, and distribution channels, leading to reduced costs, growing sales, and maximizing profits by improving business operations. 👉To put it in layman's terms, by eliminating middlemen companies can cut supplier margins, while also gaining better control over their supply chain. 👉But vertical integration has some disadvantages like high capital requirements and, the risk of increased organizational inefficiency (paradoxically), if handled unwisely, vertical integration can be catastrophic to a company. 👉Chinese company BYD is the world's first fully vertically integrated EV maker. 1️⃣ 👉Vertical integration is also a dream of Elon Musk's, by the way. According to Elon Musk, #Tesla needs greater vertical integration to manufacture an EV below $25k. 😊 👉#Tesla announced in 2020 that it would be getting spodumene to make lithium from its own mine in Nevada. 👉Elon Musk, when will ⛏ start? 😊 👉I've made a little comparison between BYD Seal and VW ID.4 in terms of their battery-electric powertrain. 👉The BYD 8-in-1 powertrain includes the BMS, VCU, inverter, PDU, OBC-DC/DC merged into one unit, and the gearbox/e-motor in another. All components are produced in-house by BYD. 👉VW has a different approach, it gets almost everything from its suppliers. 👉Take a look at the picture below to see the details. ⬇ 👉BYD can produce very affordable, technologically advanced EVs, whether it's due to vertical integration, it's hard to say for me. 👉What do you think about it? 👉 Share if you want to spread the word 👈 #vw #byd #tesla #ev