Eco friendly cars

One of the industries that have created a lot of polemic is the car industry. With the new trends about being eco friendly, the high prices of fuel and the fact that fossil fuels will come into an end in a close future, many companies started to invest in other technologies that use other sources of energy. From business perspective, they had experienced troubles in order to penetrate the different markets.

Around the world, there are different markets with cultural and ideology differences. For example, Americans and Europeans think differently when it comes to cars. A typical American seeks for a car that shows masculinity and power, therefore cars need to be fast, fuel consuming and big. On the other hand, Europeans look for those who are eco friendly, the ones that make the least harm to the environment.

Apart from the fact that the new green cars coming out in the market brings a lot of benefits to the environment, the disadvantage they have right now is cost. First, companies have invested a lot on money to develop these new technologies. Therefore, cars are not produced in big scale because the market prices are elevated. Until the demand for this cars start increase the prices are going to fall. It is a simple example of supply and demand. This will allow companies to mass produce them and reach an even larger market.

Additionally, in order to penetrate the different markets they should implement diverse global strategies, especially in this industry where there is tough competition. For example, the article “A sparky new motor” from The Economist talks about the alliance of Nissan and Renault for elaborating electric models. Carlos Ghosn, the head of Nissan-Renaults believes that by 2010 one of every ten Europeans will have an electric car. He also believes that the Prius will have a considerable percentage of the market.

I consider that companies like GM, Nissan, Toyota, among others, have to improve the characteristics of the car so that they could work just like a good fast fuel car. Since the markets are so different probably in Europe they would have a lot of acceptance since they have a culture of being green. Nevertheless, the United States, another important market in terms of consumption, will not sympathize a lot with the technology these cars uses right now. According to a study made by Dellotie, “three-quarters of Americans would not consider buying an electric car unless it had a range of 300 miles” which most of the electric cars do not have.

In order to accomplish success and to reduce CO2 emissions and global warming, the governments have to encourage their citizens to buy these cars. In many cases, subsidies are given and in others taxes are eliminated. I consider this a good motivation for consumers, particularly those who really care about the environment.

So, if we really want to see a change and worry about the environment eco friendly cars are the solutions. Nevertheless, the cost for building one is still high and not affordable by many. I can see that in the future, with innovation and technological advances like it has happen in history, some day we will each own an electric car, or any other alternative. For companies, this means innovation, investments, and global strategies in order to keep and gain more of the worlds market. It is a matter of time, in any moment electric cars boom just like the internet a few years ago, and the prices would start to fall down.

Link: http://www.economist.com/node/17202405