Utilize information from industry and scholarly sources to inform problem solving and decision making

BUS 225 Milestone One Template Advancing the Future: The Shift to Electric Vehicle Battery Manufacturing Name of Student Course Name of Professor University Date Advancing the Future: The Shift to Electric Vehicle Battery Manufacturing Description of Problem The American automotive market is experiencing fundamental changes resulting from the shifting consumer demand, technological progress, and new environmental requirements. Internal combustion engine (ICE) based vehicles are being replaced with the introduction of electric vehicles (EVs) due to consumer preference for cleaner automobiles and advancements in battery technology (Andre et al., 2015). Manufacturers such as Ford and GM, with a heritage in ICE, need to change to succeed in the current and future markets consciously. There are challenges and opportunities, including manufacturing process change, supply chain, and expansion to the EV market (Andre et al., 2015). This shift is further challenged by the high capital costs of building necessary EV infrastructure and retraining a significant workforce. Also, supply chain resilience significantly reduces the supply chain risk due to the increased demand for EV parts. This report outlines the specific actions that can be undertaken to leverage these market trends, further enhancing sustainability and achieving profitability. Description of the Current U.S. Automotive Industry The automotive industry in the United States of America is one of the largest in the world, with significant company players such as Ford, General Motors, and Tesla, among others. This situation is despite traditional companies such as Ford, GMM, and Tesla dominating the EV market, with the former having a market capitalization of over $800 Billion in 2023 (IEA, 2024). The industry has to be innovative because of the government’s mandate for reduced emissions and high fuel efficiency. Automakers are making significant investments in EV tech – GM just announced that it plans to spend $27 billion on EVs and autonomous vehicles by 2025. Nonetheless, this change presents various problems (IEA, 2024). Global events, like the COVID-19 pandemic, have disrupted logistics, leading to a shortage of semiconductors used in manufacturing. For instance, Ford indicated a net income of $2—losses of $5 billion in 2021 due to chip shortages. Shortages in labor and the rising cost of raw materials also reduce the company’s production capacity. While striving to meet these expectations, automobile makers must adjust to the dynamics and remain profitable while controlling for market share. The drive towards using advanced technology prompts societies to put more effort into research and development. In addition to the above losses, the transition to EVs entails higher costs (IEA, 2024). Battery production is very costly; lithium-ion batteries cost about $137 per kilowatt-hour in 2020 but may decline. While these are some of the challenges facing this industry, it continues to demonstrate its robustness, with 14. 3% growth in 2021 indicating strong demand and high market prospects. Current Automotive Market Trends Electrification The automotive industry’s market environment is beautiful. There is a positive trend towards EVs due to technological improvements in battery technology and rising consumer preference for electric and other non-polluting vehicles (Andre et al., 2015). This trend is projected to continue...