IDBMT001 Management Themes & Case Studies V1 1617 © 2017 Northern Consortium UK Ltd Page 1 of 5 NCUK INTERNATIONAL YEAR ONE BUSINESS 2016 – 2017 IDBMT001 Management Themes & Case Studies Case Study Analysis & Group Report IDBMT001 Management Themes & Case Studies V1 1617 © 2017 Northern Consortium UK Ltd Page 2 of 5 Case Study Jaguar Land Rover Plans to Build Electric Cars in UK The UK’s biggest carmaker Jaguar Land Rover (JLR) has announced its intention to manufacture electric cars in the UK. The Indian-owned carmaker built just under a third of the UK’s 1.6 million cars last year. Chief Executive Ralf Speth suggested that the Indianowned carmaker, which operates three car plants in central and northern England, could bring further production to the UK. “We want to build our EVs (electric vehicles) in the West Midlands, in the home of design and engineering. It makes sense to build electric batteries and cars in the market where they are to be sold if the conditions, including pilot testing and support from government, are right.” Speth told an industry meeting recently.1 The firm, based in Coventry, said it wanted to make the UK a "global centre of excellence" for battery research. However, it said it needed support from government to improve infrastructure and power supplies. Coventry City Councillors discussed how it was important for the UK Government to support JLR’s plans to produce electric cars in the West Midlands. Councillor Jim Boyle said "We want to be at the forefront of this new technology, we don't want it to go abroad”.1 The UK Government recently announced an extra £390 million of funding to support autonomous and green technologies, following on from proposals in recent years designed to promote the country as a hub for innovation.1 European Union (EU) legislation is forcing manufacturers to lower their fleets’ average tailpipe emissions, making EVs imperative for Jaguar – non-specialists in fuel efficient cars. The market for EVs is very competitive and JLR will face strong competition from Tesla and other producers already well-established in this premium market. However, JLR’s proposed investment will boost green technology and increase take-up of battery-run cars as environmental costs of petrol and diesel rises.2 Any new production would be seen as a further boost to the UK automotive sector after Japanese carmaker Nissan said it would build two new models at the country’s biggest car 1 Yahoo! News. [2017]. Jaguar Land Rover wants to build electric cars in Britain. [Online] Available at: https://uk.news.yahoo.com/jaguarland-rover-plans-build-electric-cars-britain-123451138--finance.html [Accessed 16 Jan. 2017]. 2 News Headlines 24. [2017]. Jaguar Land Rover's electric car plans could prove game-changer for industry. [Online] Available at: http://www.newsheadlines24.com/business-news/2016/11/26/jaguar-land-rovers-electric-car-plans-could-prove-game-changer-forindustry/ [Accessed 16 Jan. 2017] IDBMT001 Management Themes & Case Studies V1 1617 © 2017 Northern Consortium UK Ltd Page 3 of 5 plant, following a promise of Government support.1 After Nissan sought a promise of compensation in the event of Brexit-imposed costs to its car production, Speth told Reuters that his firm wanted from the Government, “fair treatment” and “the same deal as that already given to other UK car producers”. Jaguar Land Rover, after showcasing its first electric car at the Los Angeles Auto Show earlier this month, has stated that it wants half its cars to be available in an electric version by the end of the decade.3 Electric vehicles currently represent less than 1% of the European market. A serious commitment from a leading manufacturer like JLR will help change that. But Jaguar Land Rover’s announcement that it plans to build electric vehicles (EVs) in the UK – subject to government subsidising investment in new infrastructure – underlines the change in fortunes for the technology that, until the launch of the Nissan Leaf in the UK in 2013, largely made people think of milk floats. JLR is now seen as a relatively late entrant to a market re-awakened by Tesla and Nissan and nurtured by a global desire to cut emissions and limit pollution.2 David Bailey, professor of industrial strategy at Aston Business School, said: “Electric cars so far haven’t taken off in a big way, partly because of the upfront costs and relatively poor consumer perception, but I am confident that will change. We’ll see a lot of new cars in 2017 with a significantly greater range, like the Tesla Model 3, the Chevrolet Bolt, as well as models from Renault and Nissan. In the not too distant future electric vehicles will be a significant development for the global car market. We’re about to see the first wave of viable electric cars that can compete in the mass market – and when battery prices come down in the mid-2020s there will be a tipping point when EVs can outcompete the internal combustion engine.” 2 3 Reuters. [2017]. Jaguar Land Rover plans to build electric cars in Britain. [Online] Available at: http://www.reuters.com/article/britain-eujaguarlandrover-idUSU8N1A803U [Accessed 16 Jan. 2017] IDBMT001 Management Themes & Case Studies V1 1617 © 2017 Northern Consortium UK Ltd Page 4 of 5 Tasks Task 1 With other members of your group use the case material provided and appropriate research to produce and present an analysis of the market for electric cars using Porter’s Five Forces Model. [10] Notes: Your presentation should include an explanation of the nature and purpose of Porter’s Five Forces analysis. All members of the group should be able to justify the inclusion of each factor in the Porter’s Five Forces analysis in a question and answer session at the end your presentation. Before the start of your presentation you must give a copy of your Porter’s Five Forces analysis to your tutor. The presentation can take any format you choose but should be no longer than 15 minutes in length – including time for questions and answers. Your presentation will be recorded for the purposes of assessment. The mark you receive for this part of the coursework assessment is based on the group performance i.e. everyone in the group, regardless of their individual contribution to the task, will receive exactly the same mark. IDBMT001 Management Themes & Case Studies V1 1617 © 2017 Northern Consortium UK Ltd Page 5 of 5 Task 2 Assess the usefulness of a macro-environmental analysis, such as PESTEL, in influencing JLR’s strategic decision about whether to manufacture electric cars in the UK. [15] This task must be completed on an individual basis. The mark you receive for this part of the coursework assessment is based on your individual performance on this part of the task. Whilst the content of your report should obviously be relevant to the question, we are not looking for the perfect answer or for specific content. The emphasis for this piece of work lies in your ability to present a well-structured report that addresses the task, demonstrates critical thinking, is properly presented and makes correct use of the case material and other relevant sources, which are referenced correctly. Notes: i) The answer should be no more than 1500 words (not including the reference list). The penalty for exceeding this limit is a deduction of 10% of the overall mark. ii) The assignment should be formatted in the following way: • Use Arial font • Use font size 12 • Use 1.5 spacing • Use the title of the document as the header • Use your student name, number, class number and page number as the footer iii) At all times you should express your ideas and develop your answers in your own words. Of course you may use quotes or refer generally to text books, quality websites or journals. This is acceptable as long as they are properly referenced in the text and acknowledged in a reference list. iv) Do not use bullet points.