SWOT Analysis of an Automobile Company - Desklib

This article provides a SWOT analysis of an automobile company, including its strengths, weaknesses, opportunities, and threats. It also includes suggestions for improvement and references for further reading.

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Strength Weakness
1. Varied types of automobiles catering
to different customer segment. The
company caters to varied customer
segments according to demographic
characteristics that customers find
appealing.
Lower financial capability, leading to
issuing of bonds, selling stocks or
including credit. The Company needs
to raise significant levels of finance
for expanding or becoming a larger
automobile manufacturer.
Internal
2. Price Competitiveness in the market
in almost every vehicle segment as
economy, family, luxury, sports,
minivans, utility automobile
categories.
Lower levels of profitability compared
to competing firms, resulting in lower
levels of net revenue and incomes
(Pahl, 2007).
3. Robust selling process by training,
support and promotional methods
through dealers. Dealer engagement
process with the Company has to be
enhanced to boost sales levels.
Manufacturing is done using capacity
changing. Often the factory does not
run to full capacity leading to lower
cost effectiveness.
4. High-end innovative and research
and development capabilities.
Lower levels of technology related
investments. With availability of
lower levels of finance in the
Company, there is lower investment of
technology leading to lower levels of
innovativeness.
5. Shorter product develop cycles with
smarter licensing process (often
through competitors) (Helms, 2010).
Lesser tie-ups with multiple dealers.
Due to increasing costs from current
dealers, the Company has not been
able to make tie-up with other dealers
to expand its business.
Opportunities Threats
1. Raise stock options for attracting Increasing price threats from
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finances. complimentary products. Prices of
competitors and complimentary
products have posed significant threats
to the Company. Complimentary
products as air conditioners, audio
systems, seating covers and so on.
External
2. Create budgeting decision including
market related information that can
generate effectiveness in cost
savings.
Rising costs of crude oil have posed
significant impacts on automobile
manufacturers (Terrados, 2007).
globally there is a declining trend
associated with automobile purchase.
3. Cost reduction by outsourcing non-
critical manufacturing functions of
automobiles. Outsourcing will allow
the Company to focus on functions
that it specializes on and reduce
costs comparative to those that it
does not.
Significant developing of hybrid
technology. Various companies are
developing hybrid technologies
included in automobiles that is posing
threat to further growth and
development of the current company.
4. Make tie-ups with dealers who are
based in suburbs to do market
penetration marketing.
Rising threats from substitute products
as electric powered cars in market,
e.g. Tesla. There is a growing
consumer market likeness towards
electric cars from growing
environmental concerns.
5. Provide more discounts to create
larger market share (Bose, 2008). In
order to boost sales and create larger
market share, the Company needs to
focus on greater discounts and offers
as a method from promoting its
products.
Increased levels of competition
resulting in high dealer revenues.
Dealers have significantly raised their
share in automobile products as there
are large number of companies
purchasing the same.
Reference Lists
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Bose, R. (2008). Competitive intelligence process and tools for intelligence analysis. Industrial
Management & Data Systems, 510-528.
Helms, M. M. (2010). Exploring SWOT analysis–where are we now? A review of academic
research from the last decade. Journal of strategy and management, 215-251.
Pahl, N. &. (2007). SWOT Analysis. Idea, Methodology And A Practical Approach.
Terrados, J. A. (2007). Regional energy planning through SWOT analysis and strategic planning
tools.: Impact on renewables development. Renewable and Sustainable Energy Reviews,
1275-1287.
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