Two British billionaires have taken on the challenge of breaking into the automobile market, by introducing what they believe is the “spiritual successor” to Jaguar Land Rover’s Defender. After the last unit of the car was produced in “January 2016”, James Dyson and Jim Ratcliffe were inspired to preserve the military ruggedness of the Defender by launching their own complex electrically-powered model. My question: can they really just walk into such a large, competitive industry and succeed?
Let’s find out.
Their BHAGs (Big Hairy Audacious Goals) in one line: Launch a modern, electric and utilitarian model of the Jaguar Land Rover Defender, preserving the boxy, rugged design.
Now, let’s take a look at their most obvious obstacles: They are going to be competing with tech giants like Tesla, who already dominate a significant proportion of the market share for electrically-powered vehicles. This is going to exert serious pressure on the two ambitious entrepreneurs, as Tesla constantly invests on research and innovation, enabling them to adapt quickly and responsively to market forces, such as changes in consumer preferences.
On top of this, they have several other fundamental steps to take, if they want to triumph. They will have to establish a dealer network so they can actually sell their model to the buyers. They will also need to include updates to their design that meet global safety standards.
Most importantly, they need to exercise effective and successful marketing, in order to achieve a profitable level of sales. Ferdinand Dudenhöffer, director of CAR centre at the University of Duisburg-Essen in Germany, explained that only a minor group of car-enthusiasts will buy the car, but eventually, it would “become a niche which gets smaller over time.”
However, we shouldn’t forget that these two gentlemen are also heavily loaded with money, and they each have their own special set of skills. Mr. Ratcliffe, for instance, has bought old chemical plants that other companies wanted to abandon, and ran them more efficiently, giving them the advantage of experience. Also, with so much money, they essentially have access to a very wide range of resources.
On the other hand, Mr. Dyson’s set of skills lie in his innovative and inventive abilities with technology. His praiseworthy reputation is reflected in his success with “high-end vacuum cleaners and other products like hair dryers”. This might help them create a high-quality product at relatively cheaper costs.
Ultimately, the two experienced entrepreneurs saw a blank space in the market, and seized their opportunity. But will they sell enough units for them to profit? Perhaps, if they nail it every single step of the way. But only time will tell.
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