Opportunity Analysis Project
Table of Contents
- Approach to Innovation. 6
- Limitations. 7
- Market Analysis. 7
- Customers and Customer Development 8
- Competition and Positioning. 9
- Business Model and Lean Startup Philosophy. 9
- Learning and Adaptation. 10
Recently, increased globalization has raised enormous concerns for the environment protection and use of green technologies. Electric Vehicles (EV) have emerged as an important vehicle in the automobile industry because of environmental benefits along with the reduction oil consumption, element of innovation and network benefits (Holland, 2015). Moreover, EV requires less maintenance and causes less air pollution as compare to internal combustion engine vehicles (Hawkins, Singh, Majeau‐Bettez, and Strømman, 2013).
In United Arab Emirates (UAE), the quality of air is quite better than the other regions of urban population in the world like Beijing and Tehran. However, with the increased urbanization, the quality of the air pollution is at stake. There are frequent dust storms in UAE which also affect the air quality and causes air pollution. Therefore, it is the need of time to introduce such vehicles which produce less carbon emission and do not affect the air quality. The aim of the Electric Vehicles is to reduce the air pollution by improving the quality of air in UAE. In UAE, there is much traffic on the roads, infrastructural development, occurrence of global events, and tourism which has increased concern for the air quality. In Abu Dhabi, particulate pollution accounts for 30 to 40% as a result of human activities (Madan, 2015). In UAE, government is committed to improve the air quality through the introduction of electric vehicles, however, it has been highlighted that if EV are subsidized by the government of UAE, people will be more inclined to adopt the EV in UAE (Ruiz, 2016).
One possible limitation of EV’s is the limited range of the fuel. It takes many hours to recharge the EV but an affordable EV runs up to 100 miles which is so limited for drivers. Another limitation is high cost of EV. Average price is about $40,000. Also, consumers have limited choice of EVs in the market because companies have released few models of EVs. It takes much time to recharge the battery (Berman, 2016).
Electric Vehicles are becoming popular in UAE. I happen to be interested in the automobiles and recently I came to know the measures that government of UAE is taking in order to reduce the air pollution by controlling the emission of gases and pollutants from vehicles. It has been reported by Bloomberg that the demand for the EV is likely to increase in future (Randell, 2016). Following represent the estimated and forecasted demand of EV. By 2040, the estimated sale of the EV will account for 35% of all the new vehicle sales. Therefore, as the concern of the air quality increase, a big population is likely to shift to the electric vehicle (Randell, 2016).
In order to test the Opportunity Analysis Project (OAP) idea of Electric Vehicles, primary data was collected through interviews. Interviews were the most suitable data collection tool to test the idea of EV, because researcher have time constraints and individual interviews allowed to understand the viewpoints of the respondents which include the potential users of EV as well as customers to understand their inclination towards the innovative product like EV. Following are the questions that were asked in the interview:
|Will you prefer an Electric Vehicle? If Yes, then why?
What features would you like in EV?
How would you like to charge? At home or do you think there should be recharging stations?
Do you understand that how technology in the EV works?
Do you find EV prices low and affordable?
What factor is most important for you in EV?
What factor prohibits you to drive and EV?
Questions asked in interview to test OAP (Axsen and Kurani, 2013)
The interview was conducted targeting 10 individuals who were the users of EV. It also included 5 individuals who were students and potential consumers of EV. Here is the sample of one interview that was conducted with a potential user of EV.
Q1= Will you prefer an Electric Vehicle? IF Yes, then why?
Yes of course. It is stylish and most economical. Also, it is convenient to drive as I do not even have to press the accelerator too hard. I once drive EV and I liked it very much.
Q2= what features would you like in EV?
The most important feature that I liked in EV is it can be started without key and smart in use and appearance. I can just charge it at home and it can be pre-cooled through the use of a smartphone app which is really convenient. The seating capacity is 5+ and it has sun roof too.
Q3= How would you like to charge? At home or do you think there should be recharging stations?
I would prefer to charge it at home but I think it is imperative that, there must be recharging stations on various points in city for the convenience of the users. I have seen super charge networks of Telstra that I think is quite a smart move for the users of EV.
Q4= Do you understand that how technology in the EV works?
Well… as a layman, I am not aware of the technical aspects that much. But I am sure that one I own an EV. I will be able to know how it works and what the technical aspects of an EV are.
Q5= Do you find EV prices low and affordable?
Yes very much. I think that prices of EV are low as compared to other fuel vehicles. It is economical for everyone.
Q6= What factor is most important for you in EV?
The most important factor of EV for me is that it is battery operated and easy to use.
Q7= What factor prohibits you to drive and EV?
Well so far i think it is has a limited range and if battery dies then it leaves no other choice to the user. There should be improvement in the range of EV. Also, it takes much time to recharge the battery.
Out of 10 interviewees, almost all respondents told that they liked to drive EV and they find it convenient to use. However, the most important limitation was the short range of EV and time ot takes to recharge.
In order to formulate the creative and innovative concept of EV in UAE, I have incorporated two tools of analysis i.e. why-why-why analysis and
This tool is most commonly used in order to identify the problems and root causes that need to be considered while implementing an innovative and creative idea. Following is the why-analysis of EV in UAE:
|Why people do not use Electric Vehicle?|
|It has limited miles range.||Need more product development of EV.|
|It takes more time to recharge.|
|There are limited super charge options of EV in UAE.||Need of public awareness regarding air pollution in UAE|
|There are limited options or choices of EV in UAE?||
Subsidize EV in UAE to increase awareness among users.
|People do not know much about its benefits and technology usage.|
|There is lack of encouragement in UAE to use EV.|
The idea of EV in UAE is quite effective however, it needs more development before implementing the idea of EV practically. Following is the brainstorming conducted for the EV:
- Is the idea of EV worth doing in UAE? If it is not then cross it.
- Idea can be implemented? Do we have resources to implement this idea?
- How fast this idea can be realized?
- What are the benefits?
- Is it cheap and easy to implement?
- What are the risks?
Afterwards in the brain storming session, the votes are casted and final decision is made.
|Type of innovation||Steps|
|EV||Introducing an economic and environment friendly electric vehicle in UAE to improve air quality and reduce pollution|
|Improved battery time||Through effective R&D, enhancing the battery timing|
|Improved range||Improving the range of EV which is quite limited through R&D|
|Solar powered charging stations||Installation of solar powered recharging stations in UAE to facilitate the user|
Following are three limitations that are likely to affect EV implementation:
- High research and development cost
- Lack of awareness among the potential consumers
- Limitation of financial resources
- Industry: Automotive industry of UAE
- Attraction of Market: The growing concern for the environment and air quality has made it imperative to introduce fuel efficient vehicles that are environment friendly and provoke less emission.
- Market Segment: Young individuals who are looking for an affordable and convenient vehicle
4: In past, there is no trend of use of EV but following graph represent the sales volume and growth of EV globally. It shows that UAE does not have any significant growth of EV in past and not even present.
Volume and growth of EV globally (ev-volumes, 2016)
- Expected Growth: The EV demand in the global is expected to be on the rise. It can be seen in the figure below:
Estimated demand for EV (Randell, 2016)
The EV demand is likely to increase so there are robust chances that this is a great opportunity which will be beneficial. Also, government of UAE is taking significant steps in order to promote the adoption of EV in UAE (Shahbandari, 2016).
For the primary data collection, interviews were conducted and it was tried to analyze their demand and how it can be fulfilled with EV. Following is the brief summary of the responses of the interview in the light of questions included in the requirements:
- What does the customer need?
Customers are looking for an affordable yet stylish vehicle that is easy to use and is environment friendly. EV is the solution to the environmental pollution in UAE.
- Why does the customer need it?
Customers need EV in order to decrease their dependence on the fuel which is adding more to the air pollution in UAE. Also, EV is more economical than other vehicles.
- What is the customer using today?
Customers are using ordinary fuel vehicles which are not as economical as EV. Also, they cause more emission.
- What is the customer willing to pay for your solution? Why? How will you reach this customer?
Customers are looking for an affordable vehicle which does not require financial resources for the everyday maintenance and are easy to use. EV is affordable and consumers are willing to pay for it (Shahbandari, 2016).
|Companies offering EV in UAE||Toyota, Electric cars middle east, Telsa etc.|
|Sales of competitors||Likely to grow as government of UAE is planning to support the EV by installing charging pumps in Dubai (GulfNews, 2016).|
|Barriers to entry||High R&D cost|
|Advantages for competitors||Strong brand image and customer base in UAE|
|Partners and Allies||Huge investment in R&D
Effective marketing strategies
Working on the shortcomings of EV
For the effective implementation of idea, the business model of high performing EV will be adopted. More focus will be on the R& D in order to reduce the battery cost. Solar powered charging station will be installed in multiple regions of Dubai and Abu Debi. This will facilitate the customers and create favorable image of EV. Following is the business model for EV that will be adopted in future:
Business model (Weiller, Shang, Neely, and Shi, 2015)
When the idea came in to my mind, I was least aware of the benefits and limitations associated with EV. I had no idea about the global demand for EV and it lack of awareness in individuals about EV. After the comprehensive research and analysis, i believe that this idea is great opportunity to be implemented in UAE. Government of UAE is interested to initiate EV and implementation of EV idea in UAE is a robust opportunity from business perspective.
Hawkins, T.R., Singh, B., Majeau‐Bettez, G. and Strømman, A.H., 2013. Comparative environmental life cycle assessment of conventional and electric vehicles. Journal of Industrial Ecology, 17(1), pp.53-64.
Madan, A. (2015). Air pollution in UAE: Various aspects - ambassador report - our actions - Tunza Eco generation. Available at: http://tunza.eco-generation.org/ambassadorReportView.jsp?viewID=13223 (Accessed: 12 November 2016).
Ruiz, R. (2016). Electric cars would be adopted faster if subsidised by UAE government, experts say. Available at: http://www.thenational.ae/uae/20160229/electric-cars-would-be-adopted-faster-if-subsidised-by-uae-government-experts-say (Accessed: 12 November 2016).
Berman, B. (2016) Electric cars pros and cons. Available at: http://www.plugincars.com/electric-cars-pros-and-cons-128637.html (Accessed: 12 November 2016).
Randall, T. (2016) Here’s how electric cars will cause the next oil crisis. Available at: http://www.bloomberg.com/features/2016-ev-oil-crisis/ (Accessed: 12 November 2016).
Axsen, J. and Kurani, K.S., 2013. Hybrid, plug-in hybrid, or electric—What do car buyers want?. Energy Policy, 61, pp.532-543.
ev-volumes.com. (2016) The electric vehicle world sales database. Available at: http://www.ev-volumes.com/ (Accessed: 12 November 2016)
Shahbandari, S. (2016). UAE sets regulations for electric vehicles. Available at: http://gulfnews.com/news/uae/transport/uae-sets-regulations-for-electric-vehicles-1.1877892 (Accessed: 12 November 2016)
GulfNews (2016). Electric car charging units installed in Dubai. Available at: http://gulfnews.com/news/uae/environment/electric-car-charging-units-installed-in-dubai-1.1714424 (Accessed: 12 November 2016)
Weiller, C., Shang, T., Neely, A. and Shi, Y., 2015. Competing and co–existing business models for EV: lessons from international case studies. International Journal Of Automotive Technology and Management, 15(2), pp.126-148.