The current state of the automotive industry is one of shrinking margins, changing consumer expectations and demands, as well as pressure from the government to increase fuel efficiency. There is increased competition in the American market as foreign companies challenge the “Big Two” automotive manufacturers. Costs increase while the price for their products has remained stagnant. One way that manufacturers have managed to stay profitable is actively working to decrease costs while needing to keep the selling price the same in order to be competitive. The most successful ones have changed their relationships with suppliers to a partnership between the two companies.
As an important part of the automobile industry, the chosen product for analyzing is the manufacturing process of vehicles which is being used in the company. There are many other factors which affect the selection of process design followed by Toyota Company in the manufacturing activities of its vehicles (Mithas, et al., 2011). Along with the factors related to the process design, there are many areas that need a more refined strategic approach. A better strategic approach will help the company to achieve success in the globalized market. Toyota applies the line flow process design which falls between the continuous process design and batch process design.
Some countries have imposed a luxury-tax on cars valued over a certain amount. Some countries also have a tax on imported cars, which main purpose is often to protect own industries. This creates a significant barrier to the industry as more governments are reducing taxes for environmentally friendly vehicles, which is a major competitor to the industry. Competitive Globalisation Drivers The main components in this category include: • High level of exports and imports • Competitors from other countries • Transferrable competitive advantage • The interdependence of countries Luxury-car manufacturers are constantly attempting to reinvent and diversify themselves in order to remain competitive in the market place. They are also often setting up manufacturing sites different from assembly sites in order to more easily access different markets and more cost-effectively distribute their products.
Porter 's Five Forces Threat of New Entrants: LOW Like any automobile company, Harley Davidson industry also has large manufacturing facilities and equipments. New Entrants would have to have a large amount of capital and would need to spend tons of money in advertising and promotion to receive the same amount of brand recognition and customer loyalty that the powerhouses company Harley Davidson has already gained. And retailers, without the brand recognition and customer loyalty of the new entrants, would be afraid to carry such products. Threat of Substitutes: LOW Motorcycles don 't take much of one’s income; customers often switch to the substitutes if price increases and purchasing a cheaper substitute becomes their better choice. But, the facts that Harley-Davidson has a strong image of a lifestyle, the substitute products are no match to Harley-Davidson products.
Thus, picking a spot in the middle of two distant cultures will not form an effective urbanity for Daimler and Chrysler. Integrating two independent companies with diverse cultures into one cohesive brand is a major undertaking. Simply picking a culture will not create a sustainable culture for Daimler and Chrysler. Other cultural difference lay in what the companies valued in terms of its customers. Chrysler valued reliability and achieving the highest levels of quality, while Chrysler was placing its bets on popular designs and offering their cars for combative prices, and these two factors resulted in conflicting orders in various departments.
Also, on the competition with larger companies than Easycar. Finally, the techniques issues of car maintenance and management of the fleet. The most urgent issue to be addressed are the legal problems that have arisen from the posting of pictures of users that delay to return the vehicles. In addition, the dimension of the competing companies could be overwhelming for Easycar, since they are present in more places and have more to offer than Easycar. In terms of the question of maintenance and fleet management could be solved with the application of new technologies.
Due to the fact that Vietnam is a high potential market, with growing demand for the automobiles, increasing the disposable income of the population. Therefore, with the implementation of AEC in Vietnam, the domestic automobile producing companies will suffer from competition in the
You may have difficulty buying a car. When your credit gets checked when applying for a car loan, you might get denied with bad credit. If you are not denied, you will have high interest rates which means having a high monthly payment. Not only does banks check your credit, so do insurance companies. “They check your credit and charge a higher premium to those with lower credit scores.” Also, you may have a difficult time getting approved for an apartment.
Buyers of I.T therefore has high price sensitivity, when I.T raises the prices of their products, buyers will turn to its competitors. There is low cost of changing to other competitors. I.T therefore has little control on raising their price, and buyers has high bargaining power. Business
Disadvantages of Multinational Corporations: • Potential Abuse of Workers Multinational companies often invest in developing countries where they can take advantage of cheaper labour. Some multinational corporations prefer to put up branches in these parts of the world where there are no demanding policies in labour and where people need jobs because these multinationals can demand for cheaper labour and lower standard in healthcare benefits. • Threat to Local Businesses Another disadvantage of multinational corporations in other countries is that they have the potential to dominate the market. These giant corporations can dominate the markets they are in because they have the more renowned products and they can afford to even sell them at lower prices since they have the financial resources to buy in a much larger quantity. This can devour all the other small businesses offering the same goods and services.