In 1993, the Malaysian Government established another national car manufacturing company called Perodua (Perusahaan Otomobil Kedua Sdn Bhd) to support its local auto industry before the start of the ASEAN (The Association of Southeast Asian Nations) Free Trade Area (AFTA). Paired, together, Proton and Perodua rule much of the Malaysian car market. Proton and Perodua has been at each other’s heels since the beginning of time. Perodua was able to outsold Proton in monthly sales by 99 cars on the December 2006. This had shaken Proton undoubtedly, but at the same time awaken Perodua that it had the opportunity to outperform the national giant carmaker and replace its placement in public image. Ever since then, Perodua’s vendors and dealers collaborated …show more content…
This spells concern for the Proton brand as it no longer has any importance in the automotive industry. Enhanced innovation by its competitors like Naza Kia or Perodua has injured Proton’s brand. Instead, the reduced level of brand awareness has contributed to its declining sales in the automotive market. In a prospering economic situation in Malaysia, labour charges are comparatively affordable for Proton. With an increase in unemployment rate, Proton should not have any problem in hiring suitable labour force for their manufacturing plants located in both Tanjung Malim and Shah …show more content…
With this in mind, from 1997, Proton began preparing to equip themselves by boosting its Research & Development (R&D) capabilities. Currently thanks to rigorous R&D, it is a fully fledged automotive manufacturer capable of designing and producing its own car platforms, bodies and engines. However, at this time when most car manufacturers are quickly moving into hybrid engines, Proton had just made its first combustion engine and there would always be a hiccup in the technology used by Proton from its first predecessor engine technology i.e. Mitsubishi up to the current Campro engine, built in-house with Lotus touch. For an example, many Gen2 owners complained that the cars had a dragging acceleration. This puts Proton into a situation that frames the lack of an up to date technology to boost the car to a satisfactory pick up level. With the weight of Waja Campro (1205kg) and even the latest Exora (1422 kg), heavier than Gen2 (1190kg), this problem is more pertinent causing a slow drive as driver had to rev pretty high all the time to get decent
This was noted as a bold endeavor with a substantial amount of risk. Tom Folliard, the CEO of CarMax used innovation to redirect the current trend of standard practices, (De Wit, & Meyer, 2010). Through expansion, CarMax provided a wide variety of automotive brands to their customers, not limiting their sales to only a few makes and models, (De Wit, & Meyer, 2010). CarMax also eliminated the past practices of pressure sales by establishing fixed prices. The Team agreed that CarMax had gained a competitive edge in the market by catering to the consumer through a variety of products with set prices and no sales pressure. AutoNation CEO, Wayne Huizenga was noted as quite the entrepreneur with an initial focus on Waste Management and Block Buster Videos, an example of fragmented industry, (De Wit, & Meyer, 2010). This diversity definitely has its advantages, but can lead to misdirection regarding sustainability in one industry. The team noted similarities between the CEO’s regarding their creativity and defiance of industry rules. As the team compared the different strategies of CarMax and AutoNation, we noticed two different methods of application, each were effective yet differed in application. In a bold move, AutoNation, under new CEO Mike Jackson, followed the CarMax strategy of implementing set prices and eliminating high-pressure sales, (De Wit, & Meyer, 2010). Through creative thinking, AutoNation improved upon their practices by implementing Smart Choice software, which enhanced customer satisfaction by reducing transaction times, (De Wit, & Meyer, 2010). AutoNation captured the competitive edge over CarMax by catering to the automotive manufactures with a focus on brand versus variety, (De Wit, & Meyer, 2010). The
In 1960, the American car landscape itself had expanded as Detroit began offering “compacts” alongside their full-size models. Many drivers, however, were looking for something in between these full size and compact model; this interest gave way to a new class, the intermediate. With many innovations between 1960 and 1964, like the 406 cubic inch V8 from Ford, the 389 from General Motors, and the wedge V8s from Chrysler, the golden age of muscle cars began in 1964. The Pontiac Tempest G...
Sedgwick, David. "Pricing Power shifts to suppliers." Automotive News (2012): 2. online. 20 May 2014. .
The alliance between Honda and Rover from 1981 to 1994 was thought to be a successful case at that moment. However, four years after the end of the relationship, Rover still just had all those old models in its product portfolio. On the other hand, it was said that because of the end of the relationship, Honda was put back by four years (Button 2005).
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.
Italian manufacturer Piaggio ranks as one of the world’s top four players in its core business. It has consolidated leadership in the European 2-wheeler market. Piaggio should not miscalculate its competitors. Competition in the industry is very powerful, not only nationally but internationally as well. This is due to two well-established companies in this sector which are the Japanese Yamaha and Honda. Yamaha and Honda strengths are their long-run experience in the sector and the high quality image of products. Due to participations to the motorcycle championships, these two companies constantly receive positive feedbacks to their efforts in researching for first class products. In the future, other kinds of competitors are expected to arise: Chinese companies whose ability to imitate and create similar products at highly competitive prices is getting more and more dangerous (Piaggio, 2008)
The main problem the company is facing nowadays is the high turnover ratio closed to an average of 30% on the past three years. The fact that the company is based in an area where many of its closest competitors have offices facilitates employee’s movements from one job to another. This high turnover is mainly affecting positions among the electrical engineers in the R&D department.
Hunsk Engines is a motorcycle company that made the fatal mistake of expanding its research in the market on its new products. The companies main competitors were companies like Harley Davidson, where they sold classic products that were seen as something with altering respect. Marty Echt is hired on by Hunsk Engines to restore the company’s image, on what used to be classic motorcycles. He argues that the company made the mistake of forgetting about its original products and, “lost its identity”. This problem frequently happens when companies attempt to grow, in order for new products to make it in the market place you have to carefully strategize its competitive characteristics and know when to introduce a new product through Michael Porters life cycle.
The principle of Best Position entails improvement of Honda’s global competitiveness. For Honda and their suppliers to improve in global competitiveness, they need to have a plan. Modine and most U.S. firms need further development in the process of planning. Instead of
In 2000, Kia continues to sell a wide range of vehicles. They target a wide range of needs by offering less expensive economic ...
Toyota’s innovative nature allows them to produce quality products and maintain their brand image, even if it is at a higher cost. However, their customer base is also aware of their reliability, despite numerous recalls which dampened the organizations name, yet they are still willing to remain loyal customers.
Where there is rapid growth comes increased competition; similarities in products across manufacturers have reduced brand differentiation across the board. The problem now is the severe rise of copycat companies and manufacturers that copy designs and specifications of cars, and proceed to undercut the original manufacturer’s profit margins. So to improve their brand standing, every manufacturer’s individually have resort...
Introduction: Toyota Motor Corporation is a very successful automobile manufacturer that is recognized globally. They have continued to obtain and retain a competitive advantage over their counterparts, despite recalls over many years. Regardless of recalls, Toyota has been quick to rectify their shortcomings and continue to lead the automotive industry with their innovative measures. In this essay, I will discuss key internal factors for Toyota. Within those factors will include Toyota’s core competencies, which are what they do really well in comparison to their competition, three of their strength’s, which will include their posture within the automobile market and their heavy focus on research and development, and two of their weaknesses.
As a result of the increased demand of cars, the competition among car companies is becoming intense. Although the market of car is the biggest growing market in the world, there are still some companies who make cars failing year after year. However, there are some outstanding car companies such as The BMW Group performing distinctly.
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...