Creating an Industry as if the Planet Mattered
Chapter 5: Alternative Business Models as the Basis of a New Industrial Ecology of the Automobile
5. Alternative business models as the basis of a new industrial ecology of the automobile INTRODUCTION 5.1 This chapter explains why new business models are needed as the mechanism for the delivery of a sustainable automotive industry. As such, it will draw on a range of existing examples including Tata Nano, Project Better Place, Gordon Murray Design, the MDI Air Car and Riversimple to demonstrate the scope for different approaches to the manufacture and use of cars. It will further argue that innovative technologies may create the space within which alternative business models can prosper, while the crisis that has engulfed the mainstream industry may significantly reduce the ability to retain barriers to entry. The core idea here is that ‘technology’ as such is not the problem. The technologies that could underpin sustainable automobility and a sustainable automotive industry are there, or nearly so; the problem lies in finding an economic incentive and structure for businesses to benefit from these technologies. It is notable that a significant report on the adoption of electric vehicles in the USA highlighted that the twin business model innovations of switchable batteries and pay-per-mile contracts would be the key to the rapid expansion of the market share of these vehicles (Becker, 2009). The creation of alternative business models requires a degree of fit with prevailing cultures of automobility, but also in many cases changes to such cultures, probably resulting in a much-reduced reliance on the car. The first half of this chapter is primarily concerned...
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