SUSTAINABLE INNOVATIONS AND BUSINESS MODELS IN THE AUTOMOBILE INDUSTRY: A MULTIPLE CASE STUDY OF ELECTRIC VEHICLES D.L. Driever MSc Business Administration University of Amsterdam SUSTAINABLE INNOVATIONS AND BUSINESS MODELS IN THE AUTOMOBILE INDUSTRY: A MULTIPLE CASE STUDY OF ELECTRIC VEHICLES University of Amsterdam – Amsterdam Business School MSc Business Administration – International Management Track Master Thesis – Final Version Student: D.L. Driever Student Number: 10900985 Date: 25-01-2016 First Supervisor: D.J.H.M. van den Buuse Second Supervisor: Dr. M.K. Westermann-Behaylo Statement of Originality This document is written by Student Desie Driever, who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents. Abstract This research investigates the Corporate Social Responsibility (CSR) strategy, sustainable innovations and business models of Multi National Enterprises (MNEs) that wholesale Electric Vehicles (EVs) within the automobile industry. It is argued that the business model within the EV industry stabilizes over time, and strategic CSR and sustainable innovation have influence on the business model. The business models of EVs were investigated prior to this research by several papers, yet this research focuses on the global EV industry (Bohnsack et al., 2014; Kley et al., 2011; Pinkse et al., 2013; Zapata & Nieuwenhuis, 2010). A sample of five automobile MNEs were selected according to their sales performance in 2015 of one of their EV models. Following, a cross-case study design is used in which gathered documentary data is examined. Subsequent analysis has led to the conclusion that strategic CSR is an integrated part in the global organization. Furthermore, as all of the MNEs have made use of incremental and radical innovations it can also be stated that sustainable innovations cause the need for business model improvements. The findings of this research suggest that all MNEs within the sample have adopted an innovative business model. Subsequently, the findings in this research partly support a dominant business model, as some of the MNEs manufacture EVs designed for special preferences. Hereby it can be argued that the business models within the automobile industry are still evolving, as it is an emerging industry. Key words: Business Models, Sustainable Innovations, CSR, Electric Vehicles Acknowledgements I would like to thank my thesis supervisor, Daniël van den Buuse, for his guidance and support during the process of this thesis. Appreciated insights and suggestions were given during the meetings and by contacts trough mail. Valuable recommendations throughout the meetings, concerning the structure and content of the thesis, contributed to an enhanced result. Table of Contents 1. Introduction ................................................................................................................................. 2 2. Theoretical Foundation ................................................................................................................ 5 2.1 Corporate Social Responsibility ............................................................................................... 5 2.2 Sustainable Innovations ........................................................................................................... 9 2.3 Business Models .................................................................................................................... 11 2.4 Electric Vehicles .................................................................................................................... 15 2.5 Conclusion ............................................................................................................................. 17 3. Conceptual model and working propositions ............................................................................ 19 3.1 Strategic CSR and Sustainable Innovations ............................................................................ 20 3.2 Business Models for Sustainable Innovations ......................................................................... 22 3.3 Conclusion ............................................................................................................................. 25 4. Research Design ......................................................................................................................... 27 4.1 Multiple-Case Study Research Design .................................................................................... 28 4.2 Maximizing Generalizability, Reliability & Validity .............................................................. 29 4.3 Data Selection and Analysis ................................................................................................... 30 4.4 Case Selection ....................................................................................................................... 31 5. Results ........................................................................................................................................ 34 5.1 Within case analysis ............................................................................................................... 34 5.1.1 Nissan Leaf ..................................................................................................................... 34 5.1.2 Tesla Model S ................................................................................................................. 41 5.1.3 Mitsubishi Outlander PHEV............................................................................................ 47 5.1.4 BYD Qin ........................................................................................................................ 53 5.1.5 BMW i3.......................................................................................................................... 59 5.2 Cross-Case Analysis .............................................................................................................. 65 5.2.1 Strategic CSR ................................................................................................................. 65 5.2.2 Sustainable Innovations .................................................................................................. 66 5.2.3 Innovative Business Models ............................................................................................ 67 5.2.4 Dominant Business Model .............................................................................................. 69 6. Discussion ................................................................................................................................... 71 6.1 Working Propositions regarding Strategic CSR .................................................................. 71 6.2 Working Propositions regarding Sustainable Innovations ................................................... 72 6.3 Working Propositions regarding Innovative Business Models ............................................ 73 6.4 Working Propositions regarding the Dominant Business Model ......................................... 74 7. Conclusion .................................................................................................................................. 76 7.1 Scientific Relevance and Managerial Implications .................................................................. 77 7.2 Limitations and Suggestions for Further Research .................................................................. 78 7. References .................................................................................................................................. 79 Index of Tables and Figures Tables Table 01 - Business Model Conceptualization……………………………………..…………………. 12 Table 02 - Working Propositions Overview…………………………………………………..………. 26 Table 03 - Linking Coding Categories with Working Propositions …..…….………………………... 31 Table 04 - Ranking EV sales 2015…..…………………………………………..…………………….32 Table 05 - Description of Selected Cases………………………………………………..……………. 33 Table 06 - Business Model Canvas Nissan Leaf……………………………………..……………….. 38 Table 07 - Working Propositions Nissan Leaf………………………………………………..………. 39 Table 08 - Business Model Canvas Tesla Model S…………………………………………..………. 44 Table 09 - Working Propositions Tesla Model S……………………………………………………... 45 Table 10 - Business Model Canvas Mitsubishi Outlander PHEV…………………………………….. 50 Table 11 - Working Propositions Mitsubishi Outlander PHEV………………………………………. 51 Table 12 - Business Model Canvas BYD Qin………………………………………………………… 56 Table 13 - Working Propositions BYD Qin…………………………………………………………... 57 Table 14 - Business Model Canvas BMW i3…………………………………………………............. 62 Table 15 - Working Propositions BMW i3…………………………………………………………….63 Table 16 - Cross-case Analysis of Working Propositions…………………………...………………... 65 Table 17 - Conclusion of Working Proposition regarding Strategic CSR….………..………………...72 Table 18 - Conclusion of Working Propositions regarding Sustainable Innovations………................ 73 Table 19 - Conclusion of Working Propositions regarding Innovative Business Models ………...…. 74 Table 20 - Conclusion of Working Propositions regarding Dominant Business Model……………... 75 Figures