Study of a supplier’s JV viability in Chinese market and manufacturing footprint assessment
An auto supplier wanted to better understand the battery aftermarket in China as well as refine their decision to set up a battery manufacturing JV in China with a leading Chinese auto manufacturer.
Strategy& profiled the current state of the battery aftermarket in China, identified the key drivers influencing the evolution of the battery aftermarket, and assessed the position of the Chinese JV partner and other client’s customers. We also developed a high level plan for regionalization of the client’s production operations. We estimated the market size within certain radii of potential plant locations, calculated freight costs, estimated likely service range from the production facility, and thus ascertained the impact on the client’s operations. As a result, we gave the client strategic options for a Chinese market entry and key levers for negotiations with their Chinese JV partner.