Due to new restrictions related to harmful emissions, electric cars have attracted more attention in recent years. Modern electric vehicles have become more competitive as their characteristics are similar to conventional cars. This issue has a significant impact on the management of companies related to car production. Managers carefully monitor the development of this trend and design new strategies to address the growing demands of the general public and governments. Therefore, the principles of responsible management are becoming more and more relevant. Especially, it might be seen in the car production industry. In the article by Campbell, the author reveals the prevailing trends among the major carmakers (Campbell). The main goals of this paper are to describe and analyze the situation presented in the article and assess the implications that it raises for management and organization.
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Description of the Situation
Electric cars are becoming more and more popular, though they are more expensive than traditional petrol or diesel vehicles. However, the executive vice-president of Nissan announced that prices on automobiles that work on batteries would be decreasing over the next seven years. Therefore, the government will stop financing electric car production. Carmaker companies will not need such subsidies. He predicted that 2025 would be the turning point for customers and the entire industry as the cost of electric and traditional cars will be the same. Nissan has become the largest producer of electric automobiles in the world. Its partnership with Renault and Mitsubishi is the major factor that contributed to such favorable results. Since 2010, the company has sold more than 500,000 electric vehicles (Campbell). Nissan’s success inspires other carmakers to invest billions of dollars in the development of new technologies. Stricter emission norms also stimulate such companies to focus on innovations in this area. For example, Volkswagen intends to reach an annual selling rate of 3 million electric or hybrid cars by 2025 (Campbell). Also, Ford is going to invest more than $10 billion in electric technologies. However, the alliance of Renault, Nissan, and Mitsubishi are going to design twelve new electric cars by 2022 (Campbell). Although sales of such automobiles make up only about one percent of global car sales, the decrease in prices will improve this situation. It will be implemented as car batteries are becoming more efficient and less expensive. Due to substantial investments made by Nissan and other companies, a new technological breakthrough is about to happen.
Analysis of the Article
Public dissatisfaction caused by irresponsible management occurs throughout the world. The processes of globalization require revising the principles on which people do business. Nowadays, new trade agreements pursue such goals as eliminating poverty and deprivation, reduce pollution, and improve other social issues. Therefore, companies make decisions that are based on social, environmental, and ethical responsibilities. In this article, the application of some of the principles of responsible management is demonstrated. Generally speaking, this term implies that a company performs, taking into consideration the interests of the entire world. In this case, Nissan makes significant efforts to promote new electric technologies that have numerous benefits for the international community. First, electric vehicles are low-maintenance as electricity is much cheaper than gasoline. Also, there are fewer moving parts that should be replaced very often. It is only necessary to monitor the condition of breaks, tires, and suspension. Second, electric cars are better for the environment. Such vehicles do not cause air pollution as there are no exhaust emissions. Moreover, electric cars might be recharged by using renewable energy. Therefore, it also helps to reduce greenhouse emissions.
For example, many people use solar power during the day. Finally, Nissan as well we many other carmakers use eco-friendly materials for the production of electric vehicles. They utilize recycled, green, and bio-based materials. Third, electric cars have many health benefits. A better quality of air reduces the risks of different disorders such as asthma, heart failure, or cancer. Also, electric vehicles produce much less noise pollution. In addition, such cars are safer as they are less likely to turn over or explode. The final benefit is energy security. Electric vehicles can help countries to become more independent from oil and gas companies. An increasing amount of electricity that is produced locally improves economic situations in many countries. However, the main disadvantage of electric cars is their prices.
As Nissan along with other leading carmakers invests in electric technologies, it will promote the electrification of other sectors. The company’s management is aimed at facilitating the use of electricity. Moreover, such a decision will boost the development of renewable energy companies. Eventually, this process will transform the entire international community as people will not depend on fossil fuels. Although such changes will not occur in the nearest future, they are inevitable. As the Nissan vice-president predicts the drop in prices on electric cars in 2025, such a tendency will result in significant changes in other spheres. However, government subsidies are still necessary in order to implement the company’s goals.
Implications for Management
The main implications that the article raises are directly related to management and organization. It reveals the major trends in the car-making industry that are pertinent to management because it includes designing strategies for a company’s development. Therefore, other players are very likely to start investing in electric technologies. That is why this sector will experience rapid growth. Companies that form supply chains of leading carmakers will require more specialists. It will trigger many related processes and cause the occurrence of new economic trends. Therefore, managers of all the involved companies will focus on the restructuring of the existing systems in order to cope with the development and application of new technologies. However, as the balance will shift more to the protection of the environment and people’s health, such companies will have to implement their strategies, taking into account the principles of responsible management.
In conclusion, the automotive industry is undergoing a significant transformation. Prices on electric cars are decreasing due to the development of electric technologies. More companies are getting involved in automobile production. However, it requires revising their management principles. Nowadays, companies pay more attention to different social, economic, and environmental issues. Businesses are taking more responsibilities and cope with a bigger number of common problems. They cooperate with governments in order to overcome the existing challenges. Moreover, they have to take into consideration the interests of not only their customers but also the rest of society. Leading carmakers finance research that is necessary to create more environment-friendly materials and products. Affordable electric cars are their main goal. Such companies as Nissan, Toyota, Ford, Volkswagen, and many others have already partially succeeded in this endeavor. However, this is an ongoing process, and further development is required.
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Campbell, Peter. “Nissan Sees 2025 as Turning Point for Electric Cars.” Financial Times, 2018. Web.