Nikola Motors: a case study in bundling as a market entry strategy

Purpose By introducing how a young entrepreneurial firm leverages bundling as a market entry strategy, this study aims to suggest a way that a relatively vulnerable startup can secure its position from a threat of resource-rich established competitors. Design/methodology/approach The authors conduct...

Full description

Saved in:
Bibliographic Details
Published in:The Journal of business strategy 2021-01, Vol.42 (1), p.59-68
Main Authors: Woo, Heejin, Grandy, Jake
Format: Article
Language:English
Subjects:
Alternative energy sources
Automobiles
Business models
Case studies
Competition
Competitive advantage
Diesel fuels
Energy consumption
Energy resources
Entrepreneurs
Environmental policy
Fuel cells
Hydrogen
Innovations
Manufacturers
Manufacturing
Market entry
Renewable resources
Startups
Technological change
Technology
Trends
Trucking
Trucks
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Purpose By introducing how a young entrepreneurial firm leverages bundling as a market entry strategy, this study aims to suggest a way that a relatively vulnerable startup can secure its position from a threat of resource-rich established competitors. Design/methodology/approach The authors conducted a qualitative investigation into Nikola Motors, a Class 8 heavy-duty truck manufacturer based in Phoenix, Arizona. The analysis revealed the underlying mechanisms that allow a startup to effectively enter a market through bundling in the truck manufacturing industry. Findings Nikola Motors Co. uses a bundled business model in commercializing hydrogen-power technology used for heavy-duty truck manufacturing. Instead of focusing on a single product, Nikola’s business model created an ecosystem surrounding hydrogen fuel-cell electric heavy trucks, including hydrogen fueling stations, maintenance service and leasing. By leveraging partnership with players in other areas, it overcomes the resource limitation as a relatively small firm. Originality/value Startups seeking to disrupt markets with novel technologies risk losing their competitive advantage to imitation by more resource-rich established firms. This study examines a novel approach to a bundled business model that can be effective for relatively resource-poor new companies. It suggests practical implications on how firms which are relatively in a weak position compete with established incumbents.
ISSN:0275-6668
2052-1197
DOI:10.1108/JBS-07-2019-0145