Example Of Case Study On Elio Engineering, Inc.
At the Dawn of Innovative Newcomer’s Decision-Making
An introductory statement into the case study of Elio Engineering, Ink. brings us back to sacramental damp and cold morning in Alabama, where the person with an outstanding engineering talent was asking an ingenuous, but not engineering question “to be, or not to be”.
For the engineer, that brought to light his revolutionary project of a new passenger all-belts-to-seat (ABTS) that was not an easy task. Having molded a pilot batch of almost perfect, but pretty expensive car’s seats, it was high time to think how he was going to conquer the Detroit-based automotive giants with his generous offer to start multi-million’s cooperation with a small unknown firm of his.
In the case of Elio one would need not only an engineer’s calculator, but a cluster of work stations’ services that used to cost $25 000 almost recently. Although one day they dove to affordable $ 5000, enabling to launch prototype ABTS seats to be produced by a JV with good marketing prospects to bring the ABTS to assembly shop of the leading automotive giants.
Now it is time to plunge into frosty atmosphere where even many millions of USD can hardly melt the ice of the big producers CEO’s hearts (GM controls 29.1% of the automotive market, or Ford with 25%, or Daimler Chrysler with 16.2% as of 1998) to make them accept a bid from really a small enterprise.
National Highway Traffic Safety Administration (NHTSA) certification procedure was the very first obstacle before a small firm that eventually had only know-how to manufacture innovative ABTS seats that would save millions of human-beings.
But the engineer from Alabama was a good engineer with a good sense of trading value for money. In fact it would be bizarre to approach any of the automotive giants with a bid to buy just a piece of the materialized idea. The seats of ABTS type are much more expensive than regular ones; they may be interesting to be installed on the high-end convertibles or luxury line sedans, but not necessarily on massive production cars. The ABTS astonishing performance in car accidents is accompanied by their impressive production cost. But no innovations needed for the up-and- running big car factory with polished production cycle and successful sales of its existing products.
The closest to the automotive giants are the tier-one and tier-two suppliers of car seats. There is also tier-three supplier to these pillars of a car industry. And it was a wise decision to move step by step to approach one of those tier-three suppliers. A small unknown firm eventually managed to certify its product, to polish the technological production cycle, and what is most important had started to market its products, indirectly, maybe with less lucrative margin, through joint ventures with its direct competitors, but it had reached its goal.
All the aforementioned are true. Maybe the way of thinking of the Elio Engineering, Inc. was more constructive and less straightforward. The reality is that Elio Engineering, Inc is live and kicking and its product become even more sophisticated, but less costly; and they became a routine reality for many drivers of today.
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