Car and car spare parts manufacturers are evolving and others are merging so bring together their resources and technology while outsourcing of component designers and manufacture has increased as opposed…
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Its very imperative to constantly asses the business environment so as to keep up with competition, be updated on current developments in the industry as well as understanding the external and internal factors that affect the business (Greacen & Chou 2005). Business environment is identified as the external factors influencing the decisions made by a business and they way the business will operate there after. These factors are very critical to development of an industry and any business analyses set to investigated them should be done so in a systematic way so as to ensure the whole process in cost effective and that relevant information is obtained (Leumar 2008). One is able to concentrate on the industry’s environmental factors like the customers, competitors, the government, and suppliers. In general, it’s pertinent to note that the profit that a firm gets comes from the ways in which a market is made to be perfect. The prices that clients are willing to pay for the goods should not actually surpass the cost of producing the goods (Leumar 2008). PESTEL analysis is one of such means by which companies use to assess their performance in relation to the business environment so that changes can be made whenever possible to increase profitability (Capon 2006).
The PESTEL analysis is sometimes extended to include local national and global aspects and hence denoted as LoNGPESTEL analysis. These are some of the factors that are analysed in assessing the business environment particularly the macro environment factors that are likely to affect management’s decisions about the organisation. PESTEL is an acronym of Political, Economic, Social, Technological, Environmental and Legal factors that influence organizations decision process (Greacen & Chou 2005). The changes in taxation policy, introduction of trade barriers, establishment
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“LoNGPestel Analysis of the US Automobile Industry ( Only Passanger Essay”, n.d. https://studentshare.org/miscellaneous/1554510-longpestel-analysis-of-the-us-automobile-industry-only-passanger-cars.
At the onset of the American automobile industry, a large number of manufactures came on the scene, and vigorously vied for the domination of the local market. However, towards the end of the 1920s, only three major companies had managed to control the market. Ford, General Motors, and Chrysler were the big players in the country.
US Automobile Industry Analysis
This report analyzes the automobile industry in general, and considers a specific case of Honda Motor Company. The automobile industry, according to a 2007 census, consists of 174 companies, which employ 64,436 people (US Census Bureau, 1).
Overview of Automobile Industry
In this age of globalization, varied types of innovative technologies and features are introduced within the vehicles. As a result, the industry of automobiles became more competitive resulting in amplification of the total sale and profit margin of the organizations operating successfully in this segment.
The move of Better Place was considered to develop environmentally friendly engines and the use of the renewable energy sources. Developing such technologies required well-coordinated stakeholders including the developers, consumers, and efficient management.
Since travelling by motor vehicles was uncommon in those days, Lawson faced a lot of problems initially. With a lot of convincing, Lawson managed to get an official sanction from the British Government to ply motor vehicles on the streets.
From then, the era of the motor vehicle development commenced, with most of the cycle manufacturing houses opting to shut their cycle production and venture into this newfound business.
In the end, the entry of China into the WTO was considered a positive thing by most, although there are certainly those with contradictory opinions. The efficacious qualities that China gained by entry into the WTO; an aid to the economy, and the opening up of China's markets for more international trade and investment (to name a few).
The company has offset some of the losses in the US and Western European by exporting cars to emerging markets where growth still continues at rapid rate. BMW has effectively tapped demand for smaller fuel efficient vehicles that has demand in the market.
The US automobile segment is a huge industry producing durable consumer goods and using a nationally oriented advertising strategy to market its product. Considering all the intermediate products used in auto construction and distribution (rubber, machine tools, trucking, etc.), the total impact of the automobile industry goes far beyond the direct impact.
Toyota's Prius hybrid car gained immense popularity. Toyota has planned to produce 48,000 hybrid Camrys yearly. The demand for Toyota's Lexus RX400h hybrid crossover is also gaining momentum. Many companies are trying their expertise in making a mark in the emerging hybrid car market in the coming years.