Make or buy are strategic decisions each company need to make. It does not have to be a static choice! The 2 options require different competencies of your personel! Buying core technology is not like buying groceries at your store - market insights, partner development and co-creation needs to be properly lead to stay competitive. #energytransition #competencies #sourcing
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
Retraité
11moMichael Sura' When you start from scratch, you can select the best way you believe in. When you have a century of history, some decision was made in the past and you have to deal with inhouse know how, existing plants and brand reputation. So it makes a lot of sense for new companies to introduce innovation both in technology and organisation. And Chinese market is big enough to implement large scale production. If you add state support, no doubt Chinese made EVs will come cheaper and in technological advances to EU models