Research On Strategic Cost Management In CATL

In recent years,the new energy automobile industry has made great progress.China has also issued a number of subsidy policies to promote the development of the industry.As a core component of new energy vehicles,the power battery market has broad prospects.On this basis,the government gradually reduced subsidy standards from 2017 and accelerated the marketization of China's new energy auto industry.On the one hand,competition among domestic power battery companies will intensify.On the other hand,as government subsidies are currently only for domestic companies,the international leading overseas power battery companies have not yet entered the domestic market.With the gradual opening of the power battery market,Japanese and Korean companies will pose a huge threat to domestic power battery companies.Obviously,the future competitive situation of the domestic power battery industry is not optimistic.Strategic cost management aims to help enterprises improve their core competitiveness and has become an inevitable choice for domestic power battery companies.This paper introduces relevant domestic and foreign literature based on the theory of strategic cost management.Taking CATL which is developing well in China as an example.Starting from the current situation of cost management of the company,combined with the financial situation reflected by various capability indicators,the problems in the cost management process of CATL were discovered.In turn,according to the three analytical tools of value chain,strategic positioning and strategic cost drivers,the CATL is analyzed in depth.First,according to the SWOT analysis,the company's external competitive environment and its advantages and disadvantages are clarified.Next through the internal value chain,the industrial value chain and the competitor value chain analysis to determine the value-added links inthe value chain,find the reasons for the company's weak links in the cost management process.Then identify the structural cost drivers and executive cost drivers of economic activities in the CATL,and seek a breakthrough in solving problems from a cost-driven source.Finally,combined with the high proportion of direct materials in the CATL,the company's unreasonable layout and insufficient investment in research and development.According to the results of strategic cost management analysis,corresponding countermeasures are proposed.On the one hand,it is outsourced as a non-core business by stripping low-value-added links such as production and manufacturing.At the same time,we should increase research and development efforts to adjust the internal value chain of the CATL.Besides,by integrating the material industry chain with strategic alliances with suppliers and distributors,the raw material costs are controlled from the source.On the other hand,focus on strategic positioning and strive to open up the international market.At the same time,establish the concept of strategic cost management of employees,and guide employees to implement this concept in routine to ensure the work of strategic cost management.In addition,we will further strengthen strategic cost drivers,expand our business scope and optimize our company's layout to improve the quality of talented person.Through the research on strategic cost management in CATL,this paper hopes to help the CATL to create a sustainable competitive advantage and to draw some reference for the power battery industry.