Introduction:
BMW having high market share in European and U.S luxury car markets, started facing issues with launch product qualities and also facing a fierce competition from Japanese producers. Currently the market share was still stable but the rigorous growth of Japanese producers would affect BMW in future. These Japanese competitors had set higher standards of conformance.
Causes and consequences of BMW’s quality problems with newly launched products
Causes
The launch quality of BMW had never been an issue until Japanese makers entered the European market. The acceptable customer complaints was 10-15 complaints per car 10 years ago and BMW was able to achieve it. However, Lexus seemed to counter this with just 3-5 complaints/year on
…show more content…
However, the 7 series was at final cycle of prototyping. The 2nd option might lead to a higher cost and higher lead time which affect the launch day that was just 2 years-8 months and 5 days away. And, the employees in the factory shall be will-trained for this new approach. Also, BMW should look at the investment required for the 2nd option and evaluate its feasibility. Hence it shall be evaluated in detail with respect to cost and time before going for either of the options. Due to time constraint, it is recommended to opt for option-1 in case of …show more content…
These kind of complications shall be avoided.
Focus shall be on utilizing pre-production tools while developing the prototypes. Actual material, wherever possible, shall be used in the development of prototypes rather than having substituted parts. Make the prototypes as closer as possible to actual outputs.
Suppliers shall be involved in both design and prototyping. They can foresee the problems in the production process and with parts which BMW miss. Supplier’s expertise would definitely add value to the process. Letting them making the prototype parts would help them to learn about the part before they have to make it in volume.
Above recommendations might improve the quality and reduce the defects & customer complaints. They might also help making the ramp up faster, improving the process and increasing the savings per product launch ---------> Maintain the high quality image, Increase in the market share. However there would be a trade-off on flexibility and creativity.
Recommendations to Chairman von Kuenheim regarding BMW's strategy
Focus on continuous improvement methods – lean manufacturing
Company XYZ Motors has been known for its years of innovative automobile technology development in Japan and is known for its high quality products. The loss in domestic and international market shares in the past year two (2) years has resulted in decline of profit. Essentially, productivity results in profiting, it is important to adapt and provide products that meet the needs of the targeted consumers.
BMW is a German car, engine and bike manufacturing company founded in 1916 by Franz Josef Popp. From surveys of 2012 BMWs total revenue was euro76.84 billion, profit was euro 5.12 billion, and the number of employees working in BMW are 1,05,876. It owns the parent company of Rolls Royce motors and also produces and owns Mini Cars. The Brand in 2012 produced 1,17,109 motorcycles and 18,45,186 automobiles under all of its brands. It is also one of the best-selling automobile manufacturers in the world. It is been reported that 44% of the BMW automobile engines are power by diesel and 56% of the engines are powered by petrol. The company has been into various kinds of sponsorships and Public relations activities. BMW has also come up with high end bicycles which are sold through dealerships and online selling. BMW has also powered in sports cars, BMW cars have 20 of the formula races. BMW is also an engine supplier and supplies engine to Williams, Arrows, Brabham and Benetton. In june 2012 forbes.com listed BMW as the no1 most reputed company in the world. For the last eight years BMW has been ranked market leader in the Dow Jones Sustainability Indexes.
Product and process technology is rapidly evolving. Competition is becoming more global. Customers are placing an increasing emphasis on quality and reliability, but at the same time looking for good value. Speed to market is becoming a paradigm of world class manufacturing. To respond to this increasingly dynamic and challenging environment, manufacturers are implementing integrated product development (IPD) concepts to reduce design cycle time and improve product value.
Another strategy used by BMW to differentiate itself from other automakers in the market is the proactive usage of technology and innovativeness in the development of products. From the early 1990’s, BMW has been on the forefront of incorporating technology in its designs in line with the technological advances of the modern world. This has led to the creation of inventive products. The uniqueness of these auto products put BMW in a position of advantage. The development of the hydrogen car as early as 2000 was an indicator of the company’s innovative strategy. In addition, the company also presents itself as environment friendly creating a whole range of vehicles in this category. This is a differentiation strategy meant to boost the company’s image and reputation amongst customers. In addition, this gives the environment conscious customers a variety of products to choose from giving BMW an upper hand in the industry.
BMW- differentiation strategy, high price, breadth of product line is moderate, known for their cars being in the shop constantly and high maintenance bills.
This case depicts about the success stories of the collaboration in the automobile industry by the Japanese and US firm though they were obviously competitors. One significant success story emerging from the alliance involves Ford probe and Mazda MX-6. There were swapping of resources and capabilities between the two firms. Mazda designers design the basic platform, engine and drive train for the cars. Mazda then design the outside of the MX-6 and Ford does same for the probe. Finally both cars are assembled at a factory owned by the two firms. Ford escort was another successful offspring of the alliance where again the Mazda engineers designed the car and Ford made it. But the alliance was not without spots. Mazda Navaho one of the offspring of the alliance which was basically build upon the on of the Ford popular product Ford explorer and build by the Ford makers. Ford made an opposite step by denying to provide the Japanese partners Navaho production to continue production of its own product line. The partner Mazda in addition fell into financial distress and Ford got the effective management control of Mazda and took some bold steps which eventually went against the collaboration.
Market Segmentation, Positioning and targeting for BMW 1.1 Introduction This report aims to examine the market segmentation, positioning and targeting of BMW (automobile company). BMW will be examined giving information about the company and where it is now and any recommendations that we feel are appropriate. 1.2 BMW Company Profile BMW was formed in 1917, from the merger of two small aero engine makers. Their famous blue and white symbol stems from the colours of the Bavarian Luftwaffe and is said to resemble the view of the one of their plane through a propeller. BMW is renowned for its sporty, sophisticated & luxury image which has been built up since the 1970's with many motor sport victories ranging from Touring Car to Formula 1.
When materiel choose to be part of making any kind of products several specifications and tests must be satisfied to make sure that the materiel is 100% suitable , materiel choice must satisfy the terms of productivity, price, performance and safety .
With each of the car manufacturers operating in different parts of the globe there is a lot to consider in regards
As the taste of consumers keeping changing day-in and day-out. For example the demands of 4x4 pick up by American grew up within the year 2008 to 2009 which later moves to high convertible sports cars to accommodate friends and family. There is the need for the United States car manufacturing industries to shaken it innovativeness to meet the demands of consumers which is not within their capacity as compared to their foreign counterparts which in return turns lose its markets share to foreign competitors as compared to the global automotive
In India, till early eighties, consumers had very limited options for passenger cars. The Automobile Industry has been in the booming phase for the past 10 years, on the strength of the Indian Government’s liberalized economy policy and freedom from the License Raj. Globalization and liberalization, with the entry of many prominent foreign manufacturers, changed the automobile scenario in India, since early 1990‟s. The Government of India allowed Foreign Joint Venture in the industry since early 1990, which saw many automobile giants entering the Indian market with their models, readily available, without much waiting time for the delivery. Sudden interest of major global players has made Indian auto industry very competitive, as India provides twin benefit of ready market and low cost manufacturing base for them. Manufacturers such as Ford, General Motors, Honda, Toyota, Suzuki, Hyundai, Renault, Mitsubishi, Benz, BMW, Volkswagen and Nissan set up their manufacturing units in India in joint venture with their Indian counterpart companies, by making use of the Foreign Direct Investment policy of the Government of India, These manufacturers started capturing the hearts of Indian car customers with their choice of technological and innovative product features, with quality and reliability. Customers have started thinking to change over to the new models of cars, with related ease than before, to suit their changing life styles. With the multiplicity of choices available to the Indian passenger car buyers, it drastically changed the way the car purchase scenario in India. This transformed the automobile scene from a sellers‟ market to buyers‟ market. Car customers started developing their own personal preferences and purchasing patte...
There are many elements affecting to the success of a launching. The basic factor is to develop product that satisfies consumers’ demands and maintain the brand promise. However, consumers are not only looking for the quality of product but also concerning about the price, the promotion and so on.
Marketers ought to take into account the way to position the merchandise, the way to exploit the whole, the way to exploit the company's resources, and the way to tack together the merchandise combine in order that every product enhances the opposite. Failure to try to therefore may end up in whole dilution that could be a state of affairs during which a product loses its branded identity, leading to ablated sales and perceived quality. The vendor should conjointly take into account development ways.
The purpose of this essay is to provide a complete analysis of BMW Group. First, some background information about the company will be provided for a better comprehension of this study. Next, BMW will be assessed from a microeconomic point of view: its demand curve, organisational structure, customers, suppliers, strengths, weaknesses and its operating environment. Then, this firm will be reviewed in context of its sector from a macroeconomic perspective and more specifically its market environment, followed by a PEST analysis of other external factors such as GDP, interest rate, cost of raw materials. This study will be further quantified by a ratio analysis in order to evaluate BMW’s financial health. In the end you can find a conclusion and also a bibliography, which can be used as further reading material.
The global company Mercedes-Benz is considered one of the most successful and well-known automotive companies worldwide. Since 1886, the company’s founders Gottlieb Daimler and Carl Benz made history with the invention of the automobile, including the Daimler Group, which is one the biggest producers of premium cars and the world’s biggest manufacturer of commercial vehicles globally (Daimler, 2013). Their main focus is innovation, safety, technology, style, brand image, expansion, and superior automobiles by offering the best of the best to consumers worldwide. The brand’s philosophy is to continuously create radically new products to advance the cause of human mobility. It is also the number one luxury brand in the United States and Germany while continuously expanding in China and Russia as well (Interbrand, 2013). Mercedes-Benz has a great selection on divisions such as cars, trucks, vans, buses, and financial services offered to any consumer or business. Their global reach has increased tremendously by including production facilities in 17 countries on five continents and having 93 locations worldwide. As a pioneer of automotive engineering, their strategy is to continue the same pioneer role with the ongoing development of mobility, especially in the areas of safety and sustainability (Daimler, 2013). It is very essential for the company to focus on consumers’ needs and their highly well known brand in a competitive global economy. That is why the company Mercedes-Benz releases a brand new model every year to stay on top of its competitors by improving previous models. Some strategies practiced are global marketing, global product development, global product pricing, global advertising, global distribution, an...