1 Explain the macro environmental factors that are relevant to the car industry. Identify the opportunities and threats that have been identified for this business sector. Identifying countries and products were potential growth is predicted and why.
The automobile industry is one of the sectors which was the most affected by the crisis. Its macro environment reveals the factors that itdoes not control, and brings to light opportunities and threats. However, various countries represent potential sources of growth for this sector, but it has to innovate today to face the current challenges and challenges of tomorrow.
The political environment is very important for the automobile industry. Indeed, the politic of the country where the production is made influence considerablythe industry. The political power of the country which welcomes the production of the company decides on the level of taxation, what represents one of the most important expenses. Furthermore, the political situation of the country host must be stable, and allow a forward development. Moreover, certain political measures can be taken to revitalize certain sectors. Following the world crisis,numerous political powers of country decided to adopt, for example, subsidies to favour the replacement of the former vehicles. It is the case of Japan and thirteen countries of the European Union. For example, Germany proposes 2500 Euros for a nine years old car to be destroyed and replaced by a Green car.
The economical environment of the automobile industry is evolving. Fist of all, we can talkabout the change rate. It strongly influences the decisions of production (it is more interesting to produce a car in a country which use the same currency as the customer, in order to avoid undergoing the variations of the exchange rate), the decisions of consumption. Secondly, the economic situation of the most powerful countries of the world is important. The Gross Domestic Product, since theworld economic crisis, is decreasing for Japan, European Union, and the United States, but increase for BRIC countries.
The sociocultural environment is another very important factor. Fist, it is evidence that today cars have became indispensable in the everyday life, though the vision of the car changed for many people, due to pollution. Secondly, the world demography is considerably increasingand the growth is much more important in the emerging market. Thirdly, the consumer habits are changing. Indeed, there is a preference nowadays for low-cost cars, and more secure and reliable vehicles. Moreover, the awareness of global warning has an impact on consumer’s choices, who give more importance to automobile using less energy.
The environmental environment knows major turnovers, becauseof several factors. Firstly, the price of gas fluctuate a lot, and according to Eckard (2006), during the shortage of oil between 2000 to 2006, 41 percent of the American market car buyers declared to have changed their criteria of choice of a new car. In addition, 30 percent of car buyers added that if gas price goes on increasing, they would buy more energy efficient car. For example, accordingto Kotler (2010), GM hummer purchases decreased by 25 percent at the end of the year 2004. It proves the importance of this factor in the decisions of orientation of the strategy for the car industry. Moreover, for some years we can see growing a “green movement” all over the world, and many governments legislated to establish laws to reduce pollution and global warming. For example the protocolof Kyoto, Copenhagen Treaty, or the California Climate Bill signed by California Governor Gray Davis to reduce CO2 emissions.
And to make a success of these challenges pass by the technological innovation. Our period is characterized by an accelerated and unique development in the history of Sciences. These developments incite the companies of production to practice a policy of intense...
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