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Unit 4 Written

Product life cycles

Diesel vs. Electric CAR

Master’s in Business Administration, University of People

BUS 5110 - MANAGERIAL ACCOUNTING

Instructor – Crystal Lupo

Due Date – JULY 15, 2021

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Abstract

This paper examines two published product life cycles of Diesel vs. Electric car, and it examines

findings on the different phases of a product’s life cycle, discusses the different marketing

strategies used by the companies, and provides suggestions regarding decisions on price,

advertising, and distribution channels.

Introduction

According to Sraders (2019), the product life cycle is defined as different stages a newly

manufactured product undergoes right from the time it is first introduced into the marketplace as

rightly put by “The product life cycle is the process a product goes through from when it is first

introduced into the market until it declines or is removed from the market”

The product life cycle consists of four unique stages (Karaman, 2018).

 Introduction.

 Growth.

 Maturity.

 Decline

Product life cycles of two products

The life cycle of any product always carries it from its introduction to an inevitable decline, but

what does this cycle practically look like?

I choose two products:

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 Tesla Model S from electric cars and

 Nissan Titan from diesel cars.

Electric cars

Electric vehicles are the proverbial cars of the future, rather than the present and it’s a fact that in

spite of the talk during the past decade, these vehicles make up less than half a percent of the

billion cars on the world’s roads. For example, in France, only 2 percent of the cars sold in 2018

were either electric or plug-in hybrid. There were just 160,000 electric cars on the road which

was half percent of the total fleet. The reason is that most consumers worry about the battery that

might die on long journeys or they just find these vehicles too expensive (Boilard & Confais,

2019)

For example, the Tesla Model S is in its growth phase. Electric cars still need to convince people

that it will work and be practical. As there are more electric charging points and more people

adopt, it becomes easier to sell to those who are more skeptical of new technology like electric

cars (Pettinger, 2019). Using the knowledge from the first source about electric cars and the

second source about Tesla specifically, it’s clear that the company is already passed the

introduction phase. Tesla as a product was already introduced back in 2008 and it gained brand

recognition with several models. It’s in the growth stage because they are more accepted and

sales are rising every passing year.

Diesel cars

Diesel fuel is one of the most efficient and energy-dense fuels available today, but it doesn’t

result in flashy high-speed performance. They still need regular maintenance to keep them

running. Moreover, the sales of diesel-powered cars are falling, mostly due to environmental
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concerns from governments that are setting deadlines for diesel cars to be banned from some

cities and countries. They are losing market share to other substitute products like electric cars

and they will slowly reach the end of their life cycle (Sclar, n.d). Since the sales have fallen

considerably and the market for diesel cars may be in terminal decline. For example, as of

December 2019, the Nissan Titan was not sold anymore since the Nissan sold 52,924 in 2017,

50,459 in 2018, and only 20,268 in 2019 (Maupin, 2019). All these numbers and the above-

mentioned information show us the fact that diesel cars are disappearing because they are

causing major problems when it comes to air quality. So Nissan Titan is in the decline stage

because it was last sold last year in December

Examine the product life cycles for your chosen two products relative to how it affects the

company’s marketing strategies?

In my opinion, these two companies should have completely different marketing strategies since

their products are in different stages. For Tesla Model S that is in the growth, Tesla may acquire

small electric car companies that have also reached this stage, because otherwise, they can

become very strong competitors. They can do more advertising which will help them to increase

their sales. Tesla already stocked the company and it will help their products to grow even

further. On the other hand, for Nissan Titan that is in the decline stage, Nissan may reduce their

promotional expenditures and the number of distribution outlets, so they will save money.

Implementing price cuts and even significantly reducing the price will help them to get rid of all

the inventory. I would not suggest adding new features to the product because its engine is

already a big concern for air pollution.

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How would your suggestion be different for the two companies' brand managers about

making decisions on price, advertising, and distribution channels?

I would suggest Tesla improve product quality, especially to extend the battery life, keep pricing

as high as is reasonable to maintain demand and profits high, enter new market segments, and

shift marketing messages from product awareness to product preference. Additionally, I would

recommend using the Internet as a distribution channel. Contrarily, Nissan brand managers need

to decrease the prices dramatically to be able to clear off the inventory, reduce the advertising

costs, and use sell their products directly to the consumers.

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References

Boilard M., & Confais E. (2019). Why electric vehicle sales are about to take off. Oliver

Wyman. Retrieved July 13, 2020, from https://www.oliverwyman.com/our-

expertise/insights/2019/jun/automotive-manager-2019/customer/why-electric-vehicle-sales-are-

about-to-take-off.html

Maupin A. (2019, September 9). Nissan Titan XD dropping Cummins engines in December of

2019. Diesel Army. Retrieved July 13, 2020, from https://www.dieselarmy.com/news/nissan-

titan-xd-dropping-cummins-engines-in-december-of-2019/

Pettinger T. (2019, May 21). Product life-cycle. Economics help. Retrieved July 13, 2020, from

https://www.economicshelp.org/blog/140934/business/product-life-cycle/Sclar

D. (n.d.). The pros and cons of diesel engines. Dummies. Retrieved July 13, 2020, from

https://www.dummies.com/home-garden/car-repair/diesel-engines/the-pros-and-cons-of-diesel-

engines

Sraders A. (2019, March 4). What is the product life cycle? Stages and examples. TheStreet.

Retrieved July 13, 2020, from

https://www.thestreet.com/markets/commodities/product-life-cycle-14882534

Karaman, Jason. (2018, March 23). The 4 Stages of the Product Life Cycle with Examples.

Retrieved from:

https://expertcaller.com/the-4-stages-of-the-product-life-cycle-with-examples
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