Presented By Ashish

AbhishekDivya

BackgroundElio engineering,Inc is a private company

categorized under engineering services and manufactured automotives bodies vehicle bodies and trailers, automotive chassis, product and material trailers.

Elio engineering is a company that designs the new technology of the seat in the automobiles which is called “No compromise” or “NC”

NC seat is a part of All-Belt-To-Seat(ABTS)The firm was founded by Pual Elio and Hari

Sankara.

Timeline1996, Pual Elio designed a revolutional bike

which got a patent.1998,Pual met Hari Sankara who was his mentor

in Structural design and Analysis department of Johnson Controls,Inc.

July 1998 , Pual invited Hari to join his idea about the NC seat and they founded Elio Engineering

Nov 1998,They went to present the NC seat to Bostrom Seating, the seat supplier for heavy truck and bus industry, that was looking to develop the ABTS.

Timeline

Early1999,Bob Glaspie joined in as the 3rd member of the team.

Feb1999,Bostrom made a licensing deal with Elio.

Mar1999Bostrom planned to unveil the NC seat at an annual trade show in Kentucky

Elio’s TechnologyA new seat which progress on cost,weight

and performance called “No Compromise” or NC which was a part of special class of automotive seats in the industry called “All-Belt-To-Seat”(ABTS)

Conventional Car Front Seat Technology

Weakness

The seat material can be break, fracture or buckle after the force impact that reached it’s failure level.

Often resulting in fatal injuries to passengers.

Strength

Its components and materials are inexpensive and light weight.

Ease to manufacture and assemble

All-Belt-To-Seat (ABTS)integrates the seat belt directly into the seat.WeaknessCost

StrengthEasy to use,ComfortHigher comfort levelMore attractive

appearance“Hugs” the

passengers from the back impact.

DifferencesABTS

The shoulder belt and lap belt originate from the auto body.

Is very heavy and expensive.

Is installed only in luxury and high-end sport automobiles.

NCOriginate from the

seat.

Light weight, low cost and strong

Potential to share all segment of the auto market

Key benefit of ElioThe new technology doesn’t permit

extremely failureA special new load –level recliner

mechanism ensure that the seat doesn’t fracture at the failure level

When the force diminishes, the seat structure is still fully functional.

Bottlenecks to commercializing the Technology

Federal safety requirementRaw materials requirement such as brake

friction and UrethaneLarge capital requirementSeat styling also become talent

Relevant supporting technology

1 .Concurrent EngineeringUnderstand standard points of technology

and productsCommunicate information troughs the

processThe benefits are reducing cost and

decreasing time-to-market.Using software program such as CAD

2.Materials Science

-often found by trail and error -provide from aboard -outsource specialists -ensure quality

Manufacturing IssuesABTS seats are base on existing

technology

Independent entrant were that manufacturing was not its core competence.

Fairy large capital requirements of building a new plant.

Customers

•The ultimate user is the buyer of a new car.

•OEM customers of seat system supplies make the buy decisions.

•The seat system is part of the “total interior design” of the car.

Market ShareThe “Big Three” U.S.

auto manufacturers,Ford,

GM,and Daimler Chrysler,each has so much power that it has been able to squeeze the operating margin of major U.S. seat system suppliers down to about 2 to 5 percent.

Benefit of NC Seat

CompetitorsMany competitor already had an ABTS

seat in their product portfolio or were currently working on the technology.

The designs currently available on the market were not cost-effective solutions.

Industry experts who had the opportunity to see Elio’s design acknowledged that the Elio mechanism was a breakthrough innovation. It was expected to have cost and functionality advantage over competing technologies.

CompetitorsThe North America

automotive seating market was also highly concentrated.

Two tier-one player,Johnson Controls Inc.(JCI) and Lear Corp.

JCI had excellent seat system and total car interior engineering capabilities and strong expertise in concurrent engineering and software tools.

JCI was strong at effectively integrating strategic acquisitions into its organizational structure.

Lear was inclined to outsource more of the design and manufacturing work and merely act as a seat “system integrator”.

Entry the MarketsFor standard products and incremental

innovations, this provided tem with a significantly lower cost position and a shorter time to market.

Barriers to Entry (BTE)It would be extremely difficult for a brand-

new entrant to compete with the existing manufacturing.

In the design and development part of the value chain entry barrier were lower.

Increasingly, sophisticated software applications facilitated the development process.

How to entry?

The first was to enter the market as a tier-three or tier-two suppliers of seat mechanism or seat structure.

Advantages•The new entrant could supply its technology to all tier suppliers.•The new entrant could keep greater control over its core ABTS technology.

Disadvantages•The new entrant was likely to receive a relatively small piece of the final product’s total value-added compared to a tier-one supplier who in-sourced ABTS technology.•The lack of manufacturing and marketing experts increased the technological and market risk.