Abstract:

This study aims to support decision-making related to making or buying strategies for procuring batteries assembled on electric and hybrid vehicles for a car manufacturer introducing new models in its portfolio. In particular, several supply chain scenarios have been defined according to the battery architecture. The results show that the purchase of complete batteries implies the highest costs and CO2 emissions. On the contrary, buying single components helps improve these aspects, but it requires a certain level of vertical integration by the car manufacturer and specific know-how. Finally, purchasing modules results in the lowest costs due to reduced trips due to the product structure. Thus, this paper proposes a framework for automotive companies to effectively design make or buy strategies in their battery supply chain by comparing alternative vertical integration levels.