Mobileye competitive advantage

Case 7: Mobileye
In 1999, more than a decade before Google captured the imagination of the world with the idea of a self-driving car, Professor Amnon Shashua and entrepreneur Ziv Aviram had a dream about how to build the next generation autonomous car. Rather than rely on unreliable radar or expensive lasers, they believed that a single, cheap camera combined with sophisticated software could reduce collisions, prevent accidents, and save lives. Fifteen years later that dream was coming true: Mobileye went public on the NYSE in August 2014, with a valuation that quickly exceeded $11 billion. With 285 car models and 20 car manufacturers already committed to their technology, Mobileye expected to capture roughly an 80% share of the autonomous driving systems in the world by the end of the decade. The case explores how Mobileye built a very strong set of competitive advantages in an industry known for very high buyer power. It also explores whether those advantages are sustainable. The case is set immediately after Mobileye’s IPO in the late fall of 2014.

1. Briefly summarize the problem(s) (Assume we’ve read the case). Think about the problem from Mobileye’s perspective.

2. What is Mobileye’s competitive position? Identify the resources and capabilities that lead to Mobileye’s competitive advantage. Use the VRIO framework to assess whether those resources and capabilities can sustain a competitive advantage. 


3. Which trends in Mobileye’s external environment (PESTEL) are likely to have the greatest impact on the company’s ability to sustain a competitive advantage? How can Mobileye mitigate the threats (or exploit the opportunities) from the external environment to sustain a competitive advantage?

4. Perform a Porter’s Five Forces Analysis of Mobileye’s industry, and identify the major opportunities and threats for the industry. How can Mobileye mitigate the threats (or exploit the opportunities) from the industry environment to sustain a competitive advantage?

5. Identify the short-term and long-term challenges that face Mobileye and discuss how to address them. Develop strategic alternatives and discuss your recommendations.

· Your recommendations should flow logically from your analyses.

· What are the potential caveats (pitfalls) to your recommendations?

Mobileye: The Future of Driverless Cars

In 1999, more than a decade before Google captured the imagination of the world with the idea of a self-driving car, Professor Amnon Shashua of Hebrew University in Jerusalem, and entrepreneur Ziv Aviram had a dream about how to build the next generation autonomous car. Rather than rely on unreliable radar or expensive lasers, they believed that a single, cheap camera combined with sophisticated software could reduce collisions, prevent accidents, and save lives. Fifteen years later that dream was coming true: Mobileye went public on the NYSE in August 2014, with a valuation that quickly exceeded $11 billion. According to Aviram, everyone told them they were on the wrong track in the early days: they had picked the wrong technology, the wrong functions, and the wrong customers. But with 285 car models and 20 car manufacturers already committed to their technology, Mobileye was on a roll. Within a few years, Mobileye forecasted that it would capture roughly an 80% share of the autonomous driving systems in the world.