STRATEGIC MANAGEMENT
CASE: THE ELECTRIC CAR OF PERUSAHAAN OTOMOBIL 3 In 2020, nation’s Cabinet has proposed a new national car manufacturer, Perusahaan Otomobil 3 (PERO3). They had decided to continue further work on its K-Elektrik1 (KE1), an electric car. Working versions of the car had been leased to a limited number of people; interestingly, the data indicated that there are demands on the electric car in the nation. In February 2021 meeting of PERO3’s top management team, the Chairman Dato’ Ahmad, suggested that it might be time to build the nation’s first electric car, KE1. He noted that Toyota’s Prius hybrid had made Toyota look environmentally sensitive, where PERO3 was views as making gas “hogs”. The response was negative. Dato’ recalled one executive saying, “We lost $1 billion on the last one. Do you want to lose $1 billion on the next one?”. Even though worldwide car ownership was growing 5% annually, rising fuel prices in 2020 reduced sales of PERO3’s profitable SUVs – resulting in a loss