The primary subject matter of this case concerns the move towards utilizing electricity to power automobiles and the potential of a Chinese company to become the world's largest automaker, as well as the strategic fit of its innovation with the current external environment. It asks the students to analyze the situation facing BYD and to develop an Operations and Supply Chain strategy. Secondary issues examined include issues of managing growth and environmental sustainability.
With the emerging importance of alternative fueled vehicles, this case should be interesting to students. The case is useful in showing how the global automobile industry is quickly changing and the need for speed and innovation is essential for survival. With the rise of the Chinese automobile market, companies like BYD represent additional challenges to the American car manufacturers. The case asks students to do a number of things including assessing the future of electric cars and providing a strategic analysis of the Chinese producer BYD. These concepts are interrelated in that BYD has staked its future in the auto business on batteries.
It would be helpful to require students to do some additional research into the automobile industry; however the case can stand alone without this additional research. Students should be encouraged to think about the future of the automobile industry and the means by which vehicles will be powered. Current trends indicate that further change is likely for this industry. Students should consider the strategic direction of BYD and its operations and supply chain strategy along with the automobile industry as a whole. Assumptions should be challenged including one that the United States will lead the automobile industry, electric cars will continue to be cost prohibitive, or that gasoline powered vehicles will always be needed. An objective of the case is for students to see the importance of innovation and creativity in creating a competitive advantage, and distinctive competence for operations.
1. Do you think electric cars are a viable alternative to gasoline-powered vehicles? What is the future of the electric car? Explain your answers.
2. What are the internal strengths and weaknesses of BYD along with external, opportunities and threats (SWOT Analysis)?
3. Given a business strategy of being the word leader in manufacturing electric cars with innovative technology, what operations and supply chain strategy do you think BYD should pursue? Identify what operations and supply chain should do to help BYD compete including a mission, objectives, distinctive competence and key decisions.
4. What recommendations would you make going forward for the business as a whole to overcome its weaknesses and threats and then capitalize on its strengths and opportunities?