Proton Market Structure

1224 Words5 Pages
2.0 THE CHARACTERISTICS OF THE PROTON’S MARKET STRUCTURE AND HOW THE COMPANY UIT INTO THE CHARACTERISTIS. The Proton’s market structure is an Oligopoly market which is characterized by few firms, interdependence, non-price competition, barriers to entry of firms, role of selling costs, group behaviour and nature of the product. This market structure lies between the pure monopoly and monopolistic competition, where few firms dominate the market and has control over the market price. The suppliers of automobiles are limited however the demand for automobiles in the market in Malaysia is very high. Therefore, there is a shortage of automobiles’ supply in the market to fulfil the surplus demand of the consumers. The production capacity of Proton alone is incapable to fulfil the market demand thus other large firms exist in the industry. Proton and Perodua occupying most of the market share in Malaysia (Kasyfi Mohamad Nor, 2017). The features of an oligopoly market include price settlers, interdependence of the firm, barriers to entry, nature of the product, non-price competition, few firm and so on. Proton is a price settler which Proton is able to set their price lower to attract more local buyers in order to increase their revenues. In order to keep up with the competition with the local and international competitors, Proton is advised to take such measures in lowering prices. If Proton lowers its product price, it will significantly affect the other automobiles companies
Open Document