Electric vehicles (EVs) industry has become the choice of the masses within a few years. The driving force for this to happen is effective climate change, sustainable choices being made by people, and government incentives. Several markets across the world, for example, San Francisco, have witnessed tremendous growth of EVs, estimated to be over 34% in the year 2023. EVs are dominating about 7.8% of market shares across the United States.
Although the industry has great potential and has seen tremendous growth, most EV manufacturers are still in their nascent stages of establishing their business. Through this blog, let us understand the evolution of the automotive industry from combustion engines to electric vehicles, challenges faced by manufacturers, and the current solutions available in the market.
Where Do EVs Stand Today?
Although the first mass-produced EV was launched in the year 1999, EVs had already started to make a mark on the automotive industry. The less complicated supply needs and production time were also some of the contributing factors in addition to sustainability. From 2008 to 2010, the cost of production has become more affordable due to the sudden price drop of 50% in batteries.
With a high rate of energy efficiency, no requirement for frequent maintenance, zero emissions, and a more sustainable choice, EVs are definitely here to stay. The government has started to recognize the importance of shifting from ICE-powered vehicles to EVs and has been implementing relevant schemes. For example, the government of Massachusetts provides about $1,500 to the owner on the purchase of any kind of EVs.
Who Are The Major Players in EV Production?
Despite the huge setback in the economy across the world due to COVID-19, countries such as China, the U.S., Germany, Japan, and Korea are current leaders of EV technologies. To understand this list better, here are the top EV manufacturing companies in the world:
1. Tesla Inc. (United States of America)
Tesla is the world’s largest EV manufacturer and has been different from others in competition. The company is more associated with the CEO of the company, Elon Musk, although it was incorporated in the year 2003 by Martin Eberhard and Marc Tarpenning. The company has remained silent and secretive about their source of materials.
2. Toyota Motor Corporation (Japan)
Toyota has been catching up on the EV market with their new and innovative technology, with an investment of $70 billion for the production of an all-electric fleet with 30 electric vehicle models by the end of the year 2030.
3. BYD (China)
BYD has been the biggest manufacturer of EVs in China in terms of sales. Its innovative battery production includes Iron Phosphate Battery Solutions, BYD e6, and Blade Battery. The company has made significant contributions in the development of battery technology and has been simultaneously expanding overseas.
4. Volkswagen (Germany)
Volkswagen has been in the EV industry longer than any of its competitors. With their research center led by Dr. Adolf Kalberlah named the Centre for Future Research, the company started to develop electric vehicles in 1970.
5. General Motors (United States of America)
General Motors has been in the EV market since the year 1990, but the company later discontinued their program. And went on to destroy most of their EVs as it did not turn out to be profitable. Since then, over the years, General Motors has become one of the top 5 EV manufacturers in the world.
6. NIO Inc. (China)
NIO is known for their exceptional electric cars that were designed for luxury and comfort. The company has been one of the fastest-growing start-ups in China. The EVs have all the features, including autopilot, battery swap, wireless charging, and fast charging.
7. BMW Group (Germany)
With a market share of 4.16%, BMW has entered the EV market with full power. The company has launched BMW and Mini EV ranges to expand their market.
8. Li Auto (China)
With a market cap of $22 billion, this China-based manufacturer is in direct competition with manufacturing giant Tesla. Their six-seater Li ONE EREV SUV has been making an impression in the market with its high engine performance.
Challenges Faced by EV Manufacturers
EV manufacturers and dealers have been facing challenges that are different from the traditional ICE automotive manufacturers.
1. Supply and Demand
According to the last data, as of this year, 2023, there are over 40 million EVs on the road around the world. Compared to 2022, the number has almost doubled from 26 million, but besides this increase in number, the demand for EVs has been slow. Most EV manufacturers today have been facing the issue of overstocking.
The demand and supply balance for EVs has been unstable and a slower process, due to which most dealerships have been tackling the issue of overstocking.
2. Training Technicians
Manufacturers are consistently transitioning to the production of EVs, making necessary changes in their production as well as aftermarket stages. Most manufacturers are still producing ICE vehicles along with EVs. Machinery required for the production of EV is completely different from that of ICE.
This has been costing EV manufacturers to spend more on training their existing staff to operate and function with efficiency. By the year 2025, the industry is estimated to face a shortage of 2.3 million skilled technicians. This shortage of experienced technicians and labor has drastically affected the aftermarket and supply chain.
3. Lack of Standard Operation Procedure
Unlike established automotive manufacturers, small-scale EV manufacturers often struggle to keep up with disoriented supply chains, inconsistency, and unexpected delays in production. In the absence of a standard operation procedure or a systematic flow of work, these manufacturers often have to deal with higher manufacturing costs and inefficient aftermarket services.
Inefficient methods of production, a lack of funds, and a streamlined process limit these manufacturers' ability to invest in their production process or compete with other competitors in the market.
4. Warranty Fraud
Lack of streamlined processes has restricted EV manufacturers from investing in the right tools, software, or experts for efficient warranty management. Due to a lack of resources, managing warranty claims that involve constant back-and-forth, paperwork, money, time, and expertise is often challenging.
This drastically affects the warranty management structure and leads to fraudulent claims. Most EVs are unable to manage such losses and often end up being exposed to exploitation, unlike other manufacturers who have standard warranty management systems in place to handle such crises and supplier recovery.
Warranty management plays an essential role in the aftermarket industry, as it is essential for customer retention and managing supplier recovery.
Why Should Small Scale EV Manufacturers Choose Warranty Management Software?
1. Supplier Recovery Management
Warranty claims can have a significant impact on OEMs, especially the ones that are functioning on a smaller scale. With the integration of warranty management software solution, OEMs can easily streamline the lifecycle of supplier recovery and claim the financial losses that could be caused due to faulty parts. With the help of a proper warranty management system, OEMs can track the process of recovery and ensure that the issue is resolved in time.
2. Customer Retention
Operational efficiency is increased with a systematic process in place. Resolving customer claims and replacements quickly with minimal downtime, increases the reliability of the company. As a result of this, the EV manufacturer can build long term relations with their clients and maintain their retention ratio.
3. Clear Communication
Warranty management majorly depends on effective communication with suppliers and proper documentation of proof. Most OEMs have a team of professionals handling warranty claims. But all OEMs cannot afford to build a team. With the help of warranty management software, OEMs can not only manage the whole process efficiently but also minimize human errors caused during the process.
Suppliers and OEMs can easily access all information through the software, submit necessary paperwork, and respond to queries accordingly without any delay. It also helps in proactively managing better supplier-manufacturer relations.
Customized Warranty Management for Small Scale EV Manufacturers
As small scale EV manufacturers navigate their way through the market, it is essential for these mobility OEMs to invest in the right software. Warranty management software such as Intelli Warranty Lite are customized to the needs of EV manufacturers. Here’s how:
1. Customized to EV Manufacturers:
The aftermarket for EVs is far less complicated than ICE automotives due to the smaller number of spare parts. But the spare parts used in EVs are different compared to ICE vehicles. This makes ICE automotive-specific warranty management software solutions less effective.
Versatile parts such as batteries come with their own warranty period that could complicate the process further. With limited resources, EV manufacturers cannot precisely manage their warranty claims efficiently. Intelli Warranty Lite is custom designed for EV manufacturers in their nascent stage who do not have access to a larger and better equipped team.
2. Ease-of-Use
The warranty process is time-consuming and requires certain investment for effective execution and minimizing fraud. But EV manufacturers are fairly new with limited resources.
Intelli Warranty Lite has a flexible, user-friendly interface that can be used by any technician from beginner to intermediate level. Moreover, with convenient mobile accessibility, the dealers can submit claims on the fly in real-time. This helps the EV manufacturers in saving time, reducing downtime, and eventually increasing customer retention.
3. Streamlined Process
Just like any other company, not having a streamlined process can affect the overall efficiency of a team. Such is the case of the warranty process in the case of small-scale EV manufacturers. ( mobile app and web relate it to communication).
Why Choose Intelli Warranty Lite?
Warranty management has never been simpler. Let us understand how this is beneficial for OEMs and suppliers.
1. Auto RMA Generation:
After a claim is submitted by a dealer, an automatic RMA is generated that helps in making the process of returning parts to the OEM warehouse smoother.
2. Shipping and Tracking:
With the help of real-time tracking, dealers can easily process the RMA, pack the part that needs to be shipped, and track the package during the whole process till it reaches OEMs.
3. Claim Review:
Through the application, OEMs can easily review the claim request and take necessary action, such as:
- Requesting additional information
- Approval of a claim if it is genuine
- Rejecting the claim along with reason
4. Approval, Replacement, or Reimbursement:
Once the approval of a claim is provided on the basis of proof and verification, the next step is usually reimbursement or replacement of the part. This process is further simplified as the software has the accounting information of the dealer, and a ledger is automatically created when a claim is approved.
In Conclusion
With the help of mobile-based Intelli Warranty Lite, several small scale EV manufacturers are able to streamline their aftermarket process and save cost. EV manufacturers are consistently dodging several challenges, especially parts management, supply chain disruption, market fluctuations, etc.
In order to forge their way through these challenges, save costs, and maintain customer retention, software solutions like Intelli Warranty Lite are highly valuable. To know more about Intelli Warranty Lite and its features, get in touch with us or book a free demo today.
