Assessment of Profitability in Australian Automobile Industry

AUTO MOBILE INDUSTRY
AUSTRALIA

Table of Contents
Introduction......................................................................................................................................4
Porters five analysis of auto mobile industry Australia...................................................................4
Assessment of profitability of automobile industry and the factors which are driving this
profitability industry........................................................................................................................6
Discussion relating to change in factors which affect in profitability of automobile industry and
impact of these changes on industry..............................................................................................10
Multiple channels and formats will coexist to please diverse market segment.............................12
Conclusion.....................................................................................................................................14
References......................................................................................................................................15

List of Figure
Figure 1: Implication of optional channel alternatives in future...................................................13

Introduction
In present fast growing economy where progressively companies are seeking to plan the
productive activities in the worldwide market for the effective use of world resources and market
potentials. In Australia Four wheeler auto mobile industry is well known for its global
manufacture as there were different competitive advantage different parts of the automobile
business. In Australian four- wheeler automobile industry activities such as designing,
development, productions and marketing as well as selling of world’s motor vehicles have been
done. Australian automobile industry is the great source of revenue as it has the value of $ 37
billion (Aithal, 2017) per annum. In the present report discussion has been presented relating to
factors which drive the profitability of automobile industry. Initially Five Forces (Porter’s)
Analysis has been discussed relating to four –wheeler automobile industry of Australia and then
discussion relating to its profit driving forces. Lastly, the manner in which these forces will
change in future has been discussed along with the manner in which it will affect the profitability
of automobile industry.
Porters five analysis of four- wheeler auto mobile industry
Australia
Australian automobile industry can be analyzed in a complete manner through Five Porter
Analysis. In this approach threat of the new entrants, rivalry amongst existed competitors and
threats of substitution, bargaining power of buyers and bargaining power of suppliers is
described in detail (Aghion.at.el, 2016).
VARIANT DESCRIPTION
Threats of New Entrants The threat of new entrant in the competitive market of four- wheeler automobiles is quiet
low. Therefore there is the less threat for multinational companies. Australian car
manufacturing industry has a huge pressure from the exporters of cars within foreign
market to some level. However, as there is a decline in the tax of the export which
ultimately influence various foreign car producers to export duty- free cars in the market
of Australia. Due to which lots of challenges for the growth of the Australian automobile
industry are brought by exported cars. On the other hand a multinational company
progressively seeks to retreat from the Australian automobile industry for avoiding fuming