Automobile Industry - Research Paper Example

Download file to see previous pages Then Mr. Henry Ford came up with an idea of Car for Every one. With this idea he laid down the foundation of Ford Motor Company and start manufacturing cars at a large scale to reduce price, what we call mass production. New players also entered the market with different products than that of Ford like Mercedes, BMW, and GM.
Automobile industry is facing immense competition these days which has shifted manufacturers' concern to reduce their cost. A right balance of input and outputs can give manufacturers the edge which will be helpful for them to increase their sales and their profit margins. All this happens due to the customers' better access to knowledge. These days the customers are better informed compared to the previous days therefore even the decision of an average customer is well informed. Along with being price conscious, customers are also after quality and fuel efficiency. The hiking prices of fuel have asked customers to look for a car with better mileage. The car markets are moving fast into globalization. One can find the best of BMW's car is being driven in India, the Mercedes in America and the Ford in United Arab Emirates. Hence the manufacturers are more looking for ways to have a centralized product research and development centre and manufacturing at lowest rates since the competition has enhanced due to globalization.
Market Segmentation
In terms of customers' buying practice, market can be divided into Fleet buyers, Business buyers and Private buyers.
Fleet buyers are those buyers which buy cars in big numbers to further their business. They usually required cars which are low priced, good in fuel economy and can run smoothly for a considerable period of time without asking any major maintenance. They include hotels, cab companies, and car rental companies.
Business buyers are those which buy cars to give their executives and employees. They require cars which match the designation of the person given the car. They usually go for moderately highly priced cars.
Private Buyers buy cars for their personal use. Now depending upon their social class which they belong to, they have different choices of cars. Some buy low priced, durable cars from Toyota, Honda, GM and Ford while others may go for quality and performance and opt for BMW, Mercedes or Audi. There are some, like celebrities or people with big fortunes that buy cars as a status symbol and to show their taste for uniqueness. They usually go for Ferrari, Lamborghini, Bugatti, MayBach.
Competitors' Analysis
There are many players in the market striving to increase their size of pie.
From America we have General Motors, Daimler Chrysler, and Ford Motor Co. From Japan we have Toyota and Honda. From Germany we have Mercedes, BMW and Audi and from Italy we have Lamborghini, Ferrari and Bugatti.
But BMW faces a direct competition with Mercedes and Audi as they fall in the same class with respect to performance and price.
1. Mercedes
Mercedes Benz is present in the industry in the form of a giant. Mercedes Benz is the major direct competitor to BMW just like Pepsi is for Coke. It is considered to be an established brand within the industry among many competitors and among customers. It has built great brand ...Download file to see next pagesRead More