Electric Vehicles in Europe: Business Opportunities for Entrepreneurs

This report provides a comprehensive analysis of the electric vehicle (EV) market in Europe, focusing on the business environment and opportunities. It begins by recognizing major forces shaping the global business landscape and uses the PESTLE model to assess the political, economic, social, technological, environmental, and legal factors influencing the automotive industry, particularly for companies like Volvo. The report then identifies new and emerging business opportunities related to the production and marketing of electric cars, emphasizing the advantages of electric motors over internal combustion engines. It explores strategies to reduce costs, including demand and supply-side approaches, and highlights the importance of electric cars in the global automotive industry. The analysis also covers competitive advantages using Porter's Five Forces, emphasizing the low threat of new entrants and the high bargaining power of buyers. The report concludes by summarizing the key findings and implications for the future of electric vehicles in Europe.

Electric vehicles in Europe

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
a) Recognising the major forces shaping the global business environment in order to gain an
understanding of the changing global business environment.....................................................1
b) Identifying the new and emerging business opportunities that the production and marketing
of electric cars may present to entrepreneur...............................................................................4
CONCLUSION................................................................................................................................6
.........................................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Electric vehicles have a similar or smaller carbon footprint than their conventional
counterparts. In other words, as compare to internal combustion engines EVs are less harmful.
On the same side, EVs also have a lower cost of ownership as well. Present study will be base on
Electric Vehicles which soon will be introduce in Europe by Volvo. Volvo is car making
company which is famous for producing luxury vehicles all over the world. Therefore, the report
will further outline the information on EVs and explains the major forces which shaping the
business environment. This information will be explain by the help of supporting the business
environment model PESTLE. Likewise, In order to continue the research it will also determine
and critically examine the factors that taken by the car industry in order to gain the competitive
advantage. Apart from that, research also examine the new emerging business opportunities in
order to support electric cars and will justify its importance for long term profit.
MAIN BODY
a) Recognising the major forces shaping the global business environment in order to gain an
understanding of the changing global business environment.
It has been analysed from the research that re-emergence of fundamental allowing for
more efficient use of production capacity to generate profit at lower volumes (Ariffin and Sahid,
2018). In 2019, global business environment has been shifted from engine motors to electric
motors that might affect the electricity demand, oil and demand for battery material. In modern
times, auto makers invest highly in the electric vehicles despite still low demand.
Major forces shaping the business environment of car industry (PESTLE)
Political : Political factors might affect the Auto mobile industry by influencing new
policies, regulations and political corruptions. Due to political instability of the country Volvo
cars would have been facing challenges in earning profitability. Sometimes, due to changing in
foreign policies adopted by the US in order to protect its local auto mobile company. Besides
that, sometimes due to new policies and form which comes under the favour of the company it
helps to gain higher opportunity growth in the market (Bhattacharya and et.al., 2016). For
example : in case of political stability in major markets can bring opportunities for Volvo.
Economic : Economic forces reshaping the auto industries due to stiffening legislation or
due to increased competition in the market. The main concern of economic factor that impact the
1

organisation or industry is high competition and demand in the market to attract production
facilities as well as the efforts to sustained current carbon footprint. In order to maintained its
positioning value companies are moving further to new ways to build vehicles like Electric cars
which is taken less carbon footprint (Sölvell, 2015). This opportunity can helpful to make
financial stability stronger. However, this forces can helpful to build the business environment in
order to come up with new innovations in Europe market.
Social : In European market auto mobile transformation is not just only economic growth
but its for leisure an fun too. It has been found that 21% of the cars has been made in the EU and
that 12.1 million people in the region work either directly or indirectly in the automotive car
industry (Bostanci and et.al., 2017). So this is the opportunity for Volvo to develop or building
a innovative electric cars for the society. But on the other hand, Volvo should also aware from
the fact that they need to contribute in green projects too to sustained the reputation in the
European market. In social factor increasing the demand for self driving vehicles is the
opportunity for the Volvo.
Technological : Technological driving force is the powerful factor of the global business
environment which enable to organisation to make the competitive environment with other rival
brands. This factor analyse how technological forces can affect the firms and the remote macro
environment as well into long term. For example Electric cars are the new technological
innovation that soon will be introduce in European market. This technological innovation is the
opportunity for the company which helps to reshaping the competitive global business
environment.
Environmental : Environmental factor impact on car industry in different manner and
through different ways. Ecological trends and changes can affect the company supply chain and
availability of raw materials (Crane and et.al., 2019). However, in order to protect the business
from such factors Volvo should try to eliminate the harmful activities from the production
process in order to protect the environment. On the same side, Volvo should also need to gain
opportunity in terms of rising steps for saving air qualities effects of automotive industry.
Legal : Legal aspect of the business also determines how legal systems can influence the
general motors and the automotive industry. Laws and regulations impose requirements and
limits on the businesses. The following legal external factors are remarkable in this external
analysis of general motors. Volvo can take opportunity from the legal aspects in order to
2

expanding the regulations on auto mobile safety. Or if government imposed emissions
regulations (Savitski and et.al., 2016).
Porter's Five forces to gain Competitive Advantage
In order to gain competitive advantage from the market , it is necessary or beneficial for
Volvo to identify the opportunities for Electric vehicle cars.
Competitive Rivalry (High)
The automotive industry is very competitive in Europe. Such as the main rivalry firms for
Volvo are Mercedes-Benz including BMW, Audi, Lexus, Jaguar and Porsche. The majority of
vehicles made by these brands all differ significantly in design, functions, luxuries (Ferro and
et.al., 2016). However, to compete with those brands Volvo can promote their new innovation
strategies to launch new electric vehicle cars to generate new leads.
Threat of new Entrants (Low)
Threat of new entrants are low because of the brand equity level of the existing brands.
There are some Asian brands that have tried to compete with the existing players but failed to
grab a significant market share. In terms of that, it is not possible for new brands to come up in
the market which has already very competitive and strong. Volvo can take advantage of this and
always need to introduce new services or products for the buyers (Holden, 2016). Some of the
other barriers are presents in the market which makes the business more relaxed like initial
investment, extensive marketing and advertisement costs, strict government regulations and
economies of scale etc. all such factors can help to reduce the threat for electric vehicle cars.
Bargaining Power of supplies (Low)
There are numerous suppliers to the car industry which belongs to the small market as
compare to brands. So it means bargaining power of supplies is low by the hand of suppliers
side. Besides, In this case manufacturers are very concern and conscious about the material of
raw material and only select the best suppliers who ready to comply with the possible
requirements (Jayakumar, Chalmers and Lie, 2017). In order to make this company strength
company has to choose the best electric motor raw material for producing the high quality
outputs.
Bargaining Power of Buyers (High)
In the context of bargaining power of buyers. So its ratio is high because car motors has
been produced by different brands with having distinct brands, qualities, performance and
3

appearance and price. In the context of buyer so before investing a huge amount they easily
access to information through they will choose the best product or services. Car industry or the
companies should always need to listen up the queries of customers. Customer are willing to pay
extra for a particular brand.
Threat of substitute (Medium)
Substitute products in vehicles do not serve merely the purpose of transportation.
Substitute products instead of high standard premium cars are low budgeted car, or any other
transport such as bus train (Lin and Ho, 2016). There are a significant threat involved in this
force that means Volvo can have better opportunity to launch the new vehicles base on according
to which it also analyse the high effecting costing to better generate the cost effective market.
b) Identifying the new and emerging business opportunities that the production and marketing of
electric cars may present to entrepreneur.
New opportunities for Electric Motors
Electric motors is the much better option than internal combustion engine in order to
getting energy saving opportunities. By the help of introducing electric vehicles there are many
growth opportunities that can be be good or effective for the future development. However, the
main purpose of using or adopting electric motors is to promote the growth of sustainable energy
policies that super economic growth and environmental protection in a global context. It also
helps to enable the transparency of international markers through collection and analysis of data.
The main advantage taken by the company is high market value and brand equity in front of their
competitors.
Motor system also been used widely across the all sectors now mostly in residential and
commercial sectors. Electric motor is been used in following products or equipments like
refrigerator compressors, extractor fans, computer hard drives etc (Madonna, Giangrande and
Galea, 2018). there are different opportunities and growth that car manufacture would have been
get like Reduce the cost, Beneficial in reducing taxes, Reducing upfront cost, provide non-
financial incentives, or also develop a utility rate discounts etc.
Strategies to reduce cost can be broken down into demand side and supply side strategies.
Demand side strategies reducing the cost of purchasing a PEV. As compare to internal
combustion vehicles PEVs are much cost effective for cars.
4

Somehow motor vehicles also beneficial in financial incentives in order to increasing the
purchase price. Motor vehicles are generally rebate in taxes, income and relief in tax credits.
Another opportunity which is undertaken by the organisation in reducing the upfront cost.
However, EV also charging infrastructure challenge which has not been yet been
adequately addressed (Nieuwenhuis, Vergragt and Wells, 2017). In arranging the funds, PEV
owners does not require any financial support as compare to combustion engine makers. In
terms of that, new start-ups and new entrepreneur can take part in the development and also
develop their own opportunities and threats.
Importance of Electric cars in global automotive industry
5
Illustration 1: EVS will have 80% less moving parts

In terms of global context EV publications identifies and discusses the recent
developments in electric mobility across the globe (Sarlioglu and Morris, 2015). It has been
analysed from the data 2018 the ratio of electric cars fleet exceeded 5.1 million up to 2 million
from the previous year and almost doubling the number of electric car sales. In other words, it
generally most approaching for future sustainability as well. New entrepreneurs and new
business start-up should follow and develop a new business plan to promote the environment
sustainability. It indirectly relief in tax and also reducing the carbon footprint to bring down the
negative impact of pollution which is generated by the engine combustion. However, the
dynamic business outlook gives the positive deployment of electric vehicles and charging
infrastructure. As according to the report of green house gas projected emissions from EVSs will
continue producing the better results.
It has been observed that in auto mobile industry Electric motors are more important and
far better than combustion engine (Global EV Outlook, 2019). For that, government also should
need to convey and supporting to those entrepreneur who are interested to develop the electric
motors vehicles.
CONCLUSION
On the basis of above description it has been found that, how business global
environment can fulfill the company needs and or might be it is challenging for the company too.
Overall, study has been concluded about the driven factors and competitive advantage growth.
Therefore, study has been defined the business environment factors which might have been
threaten to company functions. Study also implied the model of porter's five forces model in
order to identify the company competitive advantage. However, it has been found by the study
that by launching the electric motor vehicles it will be prove more sustainable and effective in
long term profit for the businesses entrepreneurs.
6

REFERENCES
Books & Journals
Ariffin, A. S. and Sahid, M. L. I., 2018. Competitiveness Analysis of ASEAN Automotive
Industry: A Comparison between Malaysia and Thailand. Journal of Science, Technology
and Innovation Policy. 3(2).
Bhattacharya, A. and et.al., 2016. Is keiretsu really a source of competitive advantage for
Japanese automotive suppliers?. Journal of Manufacturing Technology Management.
Bostanci, E. and et.al., 2017. Opportunities and challenges of switched reluctance motor drives
for electric propulsion: A comparative study. IEEE transactions on transportation
electrification. 3(1). pp.58-75.
Crane, A. and et.al., 2019. Business ethics: Managing corporate citizenship and sustainability in
the age of globalization. Oxford University Press.
Ferro, C. and et.al., 2016. Additive manufacturing offers new opportunities in UAV
research. Procedia CIRP. 41. pp.1004-1010.
Holden, A., 2016. Environment and tourism. Routledge.
Jayakumar, A., Chalmers, A. and Lie, T. T., 2017. Review of prospects for adoption of fuel cell
electric vehicles in New Zealand. IET Electrical Systems in Transportation. 7(4). pp.259-
266.
Lin, L. H. and Ho, Y. L., 2016. Institutional pressures and environmental performance in the
global automotive industry: the mediating role of organizational ambidexterity. Long
Range Planning. 49(6). pp.764-775.
Madonna, V., Giangrande, P. and Galea, M., 2018. Electrical Power Generation in Aircraft:
Review, Challenges, and Opportunities. IEEE Transactions on Transportation
Electrification. 4(3). pp.646-659.
Nieuwenhuis, P., Vergragt, P. and Wells, P., 2017. The business of sustainable mobility: from
vision to reality. Routledge.
Sarlioglu, B. and Morris, C. T., 2015. More electric aircraft: Review, challenges, and
opportunities for commercial transport aircraft. IEEE transactions on Transportation
Electrification. 1(1). pp.54-64.
Savitski, D. and et.al., 2016. The new paradigm of an anti-lock braking system for a full electric
vehicle: experimental investigation and benchmarking. Proceedings of the Institution of
Mechanical Engineers, Part D: Journal of Automobile Engineering. 230(10). pp.1364-
1377.
Sölvell, Ö., 2015. The Competitive Advantage of Nations 25 years–opening up new perspectives
on competitiveness. Competitiveness Review. 25(5). pp.471-481.
Online
Global EV Outlook. 2019. [Online]. Available
through :<https://www.iea.org/publications/reports/globalevoutlook2019/>.
7

8