From Vertical to Horizontal Integration: How Automakers are Reshaping the ev Industry

Abstract

The automotive industry is rapidly transitioning to electric vehicles (evs), reshaping competitive dynamics and compelling automakers to adopt diverse strategies. In a context of such great upheaval in the automotive industry, economic research has not yet well investigated whether a dominant strategic behavior is emerging or whether there is still a non-unique dynamic. This paper analyzes the strategic approaches of Tesla, byd, Volkswagen, Stellantis, and Renault-Nissan-Mitsubishi, focusing on vertical and horizontal integration, research and development investments, partnerships, and market positioning. Using financial reports, industry publications, and corporate statements, the study examines how these companies navigate challenges such as supply chain disruptions, battery technology development, and regulatory shifts. Tesla and byd leverage vertical integration to control key production aspects and reduce costs, while Stellantis and Renault-Nissan-Mitsubishi focus on horizontal integration and strategic alliances. Volkswagen adopts a mixed approach, internalizing battery production while maintaining supplier collaborations. The analysis also considers the impact of government incentives, infrastructure expansion, and consumer demand on ev adoption. While mature markets like China and Northern Europe drive growth, other regions face slower expansion due to infrastructure and policy challenges. The findings suggest that long-term success in the ev sector depends on technological innovation, supply chain resilience, and adaptability to evolving market conditions. This research provides valuable insights for policy makers, industry stakeholders and investors who want to understand how corporate strategies are shaping the future of electric mobility in order to understand which scenarios are taking shape.