Innovative Business Models and New Partnerships are Driving the Automotive Sector

There is a new competitive environment emerging in the hybrid-electric automotive market. International partnerships are powering new automotive innovations. A host of unique business models are powering new battery car startups and new partnerships are enhancing their competitive positioning.

Fleet sales are key to the strategy of many of new hybrid-electric vehicles. These new vehicles are capable of meeting the daily driving requirements of most fleets they can also reduce fuel costs, proactively respond to emissions regulation and provide add to their marketing allure.

General Electric has announced that it will switch to battery power for half its huge sales and service fleet. General Motors alone stands to pick up orders for at least 12,000 Volt plug-in hybrids.

According to Robbie Diamond, CEO of a trade group known as the Electrification Coalition. Fleet buyers are helping to provide the momentum needed by EV and hybrid producers to reach critical mass. “Fleet owners and operators can lead the way in this transformation…to accelerate the development of electric vehicles.“

Canada’s Azure Dynamics is focusing on fleet sales by converting light and medium-duty trucks, such as the Ford Transit Connect Electric. the firm’s close relationship with Ford Motor Co., which is providing the Transit Connect gliders that are being converted to battery power

Competition is growing with new car companies like Amp, Aptera, Fisker, Tesla, Think, Wheego and others are taking on the behemoths who have long dominated the automotive market.

“It’s the first time where that’s been possible in more than a half-century,” said Jim Taylor, a former General Motors executive who has served as general manager of both the Cadillac and Hummer and is now a board member for Amp.

Amp has a modified version of the Chevrolet Equinox that replaces its fossil fuel engine with its proprietary lithium-powered drive train. Rather than going head to head with the automotive giants, companies like Amp are seeking to exploit the larger SUV niche.

Others like Atlanta-based Wheego, are competing directly with the big boys, while limiting the size of its internal development team by partnering with outside contractors to hold down costs. The name Wheego refers to the ferrous-based lithium-ion batteries that power the car.

Wheego has engaged a small Chinese automaker to provide the unpowered body (glider) for Wheego’s new LiFE.

According to some, traditional automakers may not be sufficiently agile to adopt to such a low-cost business strategy. “This is a market sector that is very much contingent on new technology, unlike the combustion engine segment, where there hasn’t been a truly significant breakthrough in half a century," says Wheego’s firm’s CEO, Mike McQuary.

Tesla Motors, initially came to market with a low-volume, high-priced sports car, the Tesla Roadster. However, starting in 2012, Tesla plans to move more mainstream with the Model S sedan. Tesla is forming a series of alliances including Daimler AG (Mercedes-Benz and Smart car brands) and Toyota. These new partnerships, will help to make Tesla much more viable over the long-term.

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