Strategic responses to electrification and firm performance: Evidence from the world car industry

Résumé:

The transition from Internal Combustion Engine Vehicles (ICEVs) to Battery Electric Vehicles (BEVs) has fuelled a vast academic and policy debate. While there is broad agreement on the prominent role of BEVs in shaping the future configuration of passenger cars (Alochet et al., 2023), there is no consensus about the phase of technological transition the industry is currently experiencing and its trajectories (Brem & Nylund, 2021). The debate has mainly focused on the disruptive nature of BEV and the relative advantage between incumbents and new entrants (Perkins & Murmann, 2018; MacDuffie, 2018; Teece, 2018), and how much the leading OEMs’ architectural and integration capabilities, at the production level, are still important in the face of technological shifts and new modularity approaches (Jacobides et al., 2016; Murmann & Schuler, 2023). Furthermore, recent industry data have shown mixed trends in BEV sales, with acceleration in the growth rate alternated with slowdowns, and persisting differences in market penetration, confirming that this transition is long and non-linear. However, to the best of our knolwdege, few empirical studies have systematically investigated firms’ strategic responses at the product and market levels conjointly. To understand the observed intra-industry differences in BEV sales growth, we explore the role of firm-level response strategies (Christensen et al., 2018) in shaping the growth trajectories of this technological transition. The empirical analysis relies on a panel dataset of global automotive manufacturers observed at the brand-year level over the period 2014-2025. Data comprises detailed information on vehicle sales, powertrain technologies, market segments, and geographical distribution across major automotive markets. The dependent variable captures BEV market performance, while core explanatory variables include prior BEV specialization, firm scale, portfolio diversification across market segments and geographical regions, and the degree of brand concentration within automotive groups. The results reveal several systematic drivers of BEV sales growth across manufacturers, and discussed in terms of implications to the current academic debate and in terms of managerial and policies outcomes.