IKEA PRESENTATION
Benefits and risks slide:
Benefits
Easier on environment -
EVs don’t even have an exhaust system, meaning they have zero emissions. And since gas-powered vehicles are large contributors to greenhouse-gas buildup in the earth’s atmosphere, making the switch to an electric car can help contribute to cleaner air and a healthier planet.
EV can also reduce overall CO2 emissions when the electricity they use comes from fossil fuels. A recent lifecycle analysis of electric vehicles showed that even when powered by the most carbon intensive electricity in Europe, they emit fewer greenhouse gases than a conventional vehicle.
Cheaper than gasoline –
Americans pay an average of 15 cents per mile driving gas-powered cars, which really doesn’t seem like much — until you compare it to the fact that many EVs run at one-third of that cost, given that electricity is significantly less expensive than gasoline.
Maintenance is less frequent –
EV is fully electric, it no longer uses oil to lubricate the engine. That means oil changes are a thing of the past. The same is true for a lot of other expensive engine work that could afflict a gas-powered car. Brakes won't wear as quickly, either, so you won't need to replace pads as often as you do on a normal car.
Quiet – Some communities prohibit heavy trucks from operating during the night with the EV quiet engine there’s a night deliveries or travel advantage; the driving time cut by lower traffic at night could save up to 40 percent in delivery costs.
Business sustainability – A handful of cities in Europe plan to prohibit fossil fuel powered vehicles from entering certain city centers. So with EV Ikea will be able to deliver goods within Europe and not having to risk losing that specific market of people.
Risks
Short Range - Electric vehicles including trucks and vans have this common problem: range limitation, which is a cause for concern and anxiety among electric vehicle owners. Haulers are designed to crisscross states. Cargo distribution service providers need vehicles that provide good range including the ability to refuel/recharge anywhere at the shortest possible time.
BUT: The UK government is inventing a recharging road that uses magnetic induction (the same technology used in wireless phone chargers) to recharge the cars’ batteries while they’re driving. Within this year the government is starting trials (on private sites) and is investing 500 million for the project over the next 5 years.
Recharging can take long - Compared to the few minutes it takes to fill up a conventional car at the gas station, recharging your EV is a much more significant time investment. While most electric car engines take about four hours to reach a full charge, some take a whopping 15 to 20 hours.
BUT: Innovation for charging station is improving as Tesla is working on a semi model with a 500 mile daily range with a hour “top off” charge delivered via a high-capacity tesla charging station.
The most widespread fast-charging network, CHAdeMO, offers 16,026 outlets around the world. The next-largest is the Tesla Supercharger network, which currently offers 6,118 outlets at 909 stations, can give you, “up to 170 miles of range in as little as 30 minutes.”
Large initial investment – One reason for high prices is the newness of electric vehicle (EV) technology. Just like how the latest, greatest smartphones cost more than their predecessors did a year ago, cars generally cost more with the launch of each new generation. Only with EVs, the sticker price includes the billions of dollars spent on research and development by a century-old industry still in the early stages of switching from gasoline and diesel to electricity.
BUT: While it is true that the up-front purchase cost of a new electric vehicle is higher than your basic gas-powered car, over the life of the vehicle you might pay less when you plug in. While exact rates vary across the country, the average cost of an electric mile is almost always less than the cost of a gas mile.
Charging station availability is inconsistent: With EV a charging station is crucial to keep the car running especially on long trips but as of now charging stations are limited.
BUT: Nikola One has claimed that hydrogen fuel cells on its trucks will be able to replenish battery charges while on the highway, giving the truck a range of 1,200 miles.
The California Public Utilities Commission approved over half a billion dollars in utility investment to support medium- and heavy-duty vehicle charging this year.
Adaptability – For centuries we’ve adapted to rely on conventional gas vehicles as a means of transportation whether if it’s in business or every day life. The shift means that we must learn to adapt to new standards, new rules, new technology and that can be challenging.
BUT: EV is now an emerging trend and will be the future especially in business as many competitors are now adopting to EV. With Walmart already has purchased 45 of Tesla’s electric trucks; UPS is piloting a full-EV fleet in London; and FedEx recently announced an order of 1,000 electric delivery vans. The National Renewable Energy Lab (NREL) is partnering with Frito-Lay to study its deployment of 10 medium-duty electric vehicles for deliveries in Seattle.
Stakeholder impact: With the new change major stakeholders will be impacted
Shareholder: Like mentioned before the investment on EV is not cheap however with competitor now catching on to adapting toward EV it is in the best interest for investors to build on new strategies that would improve their business as a whole and EV is the answer to that.
Employees: Changing the game plan means new rules for the players and that means new training program for employee to understand the mission of EV and ways of operations. This may have an influence on employee to potentially in wanting to invest in an EV later on.
Customers: The “green way” today have now become the trends and customer’s are more attractive to company who show effort on having good impact in the world and it’s a great way of the business to say that they care for the customer more than just the money they get from customers which then will promote loyalty especially for those who are supporters of CSR. A study found that there’s a link to customer concern for the environment to their buying behavior.
Competitors: Business has great influence over other businesses. IKEA have showcase that EV is a good Idea and in the article have shown to already implement it in Shanghai China by partnering up with a warehousing and distribution partner called Beiye new brother logistics Co and an electrical leasing company named DST to help create an electric vehicle and vehicle sharing platform for IKEA. Seeing the possibility it will drive companies to push its delivery suppliers to adopt electric.
IT’s only possible when we see the risk of not acting:
Pollution: Is this really the view we want to see? The world we want to live in?
Cars, trucks, and buses powered by fossil fuels are major contributors to air pollution—transportation emits more than half of nitrogen oxides in our air, and is a major source of global warming emissions in the US. Studies have linked pollutants from vehicle exhaust to adverse impacts on nearly every organ system in the body
Diesel bans: ninety German cities might join Paris, Madrid, Mexico City, and other major urban centers in banning diesel cars as soon as practically possible.
EV is the future: Many big name companies are now leaning towards EV and once EV becomes a big hit if other businesses have not yet changed their game plan they are far behind from many competitor which is another reason why IKEA is investing in the mission so much.
Our recommendation:
Develop and connect model: collaborate with organizations and individuals around the world, systematically searching for proven technologies, packages, and products that we can improve, scale up, and market, either on our own or in partnership with other companies
IKEA will have to use this method for the next 4 cities in Europe and U.S that it intends to tackle.
Continuous testing: Innovation is a trial and error process the more you find out about what doesn’t work you can narrow it down to the target solution easier
Keep innovating: In the business world, innovating is the answer to sustainability. We must continue to create new ways of creating products and providing services it is only that way that our brand will keep its place in the fierce market of business.
Sourcing wood products more sustainably:
All of the cotton in Ikea Australia products, including soft furnishings, bedding, towels, and rugs, now comes from more sustainable sources. Fifty percent of the wood used for Ikea products in FY17 was Forest Stewardship Certified
Many of our products are made of wood. We have the ability – and responsibility – to influence not only how our wood is sourced but also how forests are managed”
