TUW RACING : 3DGE Formula car
The 3DGE (read EDGE) Formula car was developed by the TUW Racing Team for the Formula Student Competitions. It has an outstanding award-winning design, it is powerful, yet easy to handle. Thus, it will bridge the gap between karting and formula racing, combining the best of both: the user-friendliness
of karts with the high-technology and driving experience of the formula cars.
Product & Business Model
A fully operational prototype is already developed. The 3DGE prototype has a carbon frame with an integrated steering wheel that provides light weight.
As the formula car can especially be raced on tracks, the focus is on 2 customer segments: kart track owners that want to enrich their kart range and professional racers. In order to fulfil the customer needs, 2 product models are developed respectively: the 3DGE Basic and the 3DGE Performance.
While the Performance model has the same technical characteristics as the prototype, the Basic model will have a steel frame that will reduce the selling price, while still offering competitive features and a formula driving experience.
The revenues will be generated mainly through sales, renting and leasing of the 3DGE cars to kart track owners and professional racers. A certain amount of revenue comes also from brand-placement on the cars and certificates for 3DGE Trainers.
The 3DGE will be manufactured in Vienna, Austria, which will secure a good brand image. The core competence is the manufacturing of carbon parts for the Performance model and the steel parts for the Basic model. 3DGE LTD will do the assembly work of all other parts procured from third-party suppliers.
Market & Competition
The targeted market is the European market that has a potential volume of about € 15M for the 3DGE Basic and € 130M for the 3DGE Performance. The main competitors for the Basic model are the Karts and the Superkarts, while for the Performance model the main competitors are the Ariel Atom and the Radical SR8. However, 3DGE outperforms all competitors in terms of its outstanding combination of power, easy handling and price.
As 3DGE Basic has a strong competition from karts, a price leader strategy for this model is elaborated. On the other hand, the 3DGE Performance relies on a differentiation strategy and a premium price.
Therefore, the following pricing scheme is defined:
[Abb. vgl. unten]
The initial investment of € 1,500,000 should cover the negative cash-flow in the first two years until the company breaks-even in 2nd year, after selling 131 cars. The profits in the 3rd year rise to more than € 900,000 with a sustainable increase in the following years.
TUW Racing Team