Factors Affecting Automobile Sector and PESTLE Analysis of Land Rover

This study explores the factors affecting the automobile sector, with a focus on Land Rover. It includes a PESTLE analysis of the company and discusses the positive and negative impacts on the business. The study also includes a reflection on the research process and insights gained.

Business environment

INTRODUCTION
Business Environment is sum or collection of all internal and external factors such as
employees, customers needs and expectations, supply and demand, management, clients,
suppliers, owners, activities by government, innovation in technology, social trends,
sustainability, market trends, economic changes, etc. This study which covers question such as
factors affect the automobile sector, PESTLE analysis of land rover, Positive impact on Business
and Negative impact of Business and reflection to understand what I went through for
completing the report.
Task 1
1. Key issues affecting the sub-sector.
United kingdom's automotive industry is a large industry where whole economy is based
on the automobile sector. Over the £82 billion turnover and adding £18.6 billion value to the
economy. There are factors which affects the sub- sector:
 Increasing costs- By increasing cost of the land rover as they manufacture one of the best
SUV's in the world. They also face such problems related to the costs increments. Which
reflects on the sales of there car selling which is getting changed. The whole industry is
suffering from the infarction because of the factors which affects the internal and external
environment of the company. Some companies have no option but to eat the cost and
some increase the prices of their products so that they can pass it to consumers and earn
from them. There are many types of cost which sometimes enables companies
success(UK Automotive International Competitiveness Study 2018, 2018).
 Fluctuating customer demand – customer have different expectations related to cars. The
demand of the customers changes according to the taste and preference. Factors such as
increase in the cost and increase in the parts of land rover which is quite expensive and
these parts have high duty on exporting them. Trends of the market changes and to be in
the market company needs to be more innovative and customer friendly(Hong Kong

Expects First Annual Recession Since Global Financial Crisis, 2019). Land rover have
2.64 percent market share in the market. Land rover have different SUV's in the market
which are available at different prices and according to customer fluctuating preferences.
TASK 2
PESTEL analysis of Land rover
Political factors of Land rover –
 the political stability is an important factor which affects the land rover if they are
planning and forecasting to grow their business, where some countries have issues with
the political views. Political views are different in when a company cross the
geographical boundaries. Government also make the decision making of the company.
Observation tells that because of stability which is maintained by political factors
countries earn the benefit from them. Land rover they don't maintain the stability then it
will disrupt the flow of economy.
 Changing government regulation is another major political issues that affect overall
working of companies.
Economic Factors of land rover
 land rover's methods of payment of production also can changed by the government
spending. The reduction in the investment of the government in the automobile industry.
The development of Land rover can be affected by the less borrowing and lending.
 Rise in the inflation rate of the economy where company has to make increment in the
profits(financial times, 2019). Increasing inflation rate is the issue for business
 Exchange rate fluctuation create problem in this sector because it increases trade cost of
the firm.
Social Factors of Land rover –
 social trends can effect on the business as they are keep changing . Land rover has to
behave and understand the and should be well aware of the religious values and beliefs of
the peoples living in the society. For example – christian workers are not required to
work on the Sunday and where muslin workers are given short period of time for their
prayers.
 Age is the major issues, changes in demographic feature change the perception of
consumers hence it affect the firms to great extent.

Technological Factors of Land rover –
 technologist keep on changing by time and with time and where land rover is using the
cutting edge innovation in its design of cars and also in the manufacturing. Land rover
Touch Pro's next-generation hardware and software advances Discovery’s connectivity
and entertainment to the very best level and smartphone pack, rear seat entertainment are
the new technologies which attracts more customers.
 Land rover still developing in the technological errors for eliminating driving errors.
They ensure high safety in their environment(World Bank Open Data, 2019).
Legal Factors of Land rover –
 land rover like other cars they ensure that they have to take copyright and patents of there
products. Land rover has to follow the rules and regulation of the countries in which
they operate in the environment. It is necessary for every company otherwise they won't
be allowed to serve in the international markets.
 In some places company is already suffering from bad image because some people think
the quality they are offering is not up to the mark. There have been real incidents such as
there items has fallen and resulted in death. If company does not focus on improving it
then they will face many lawsuits.
Environmental factors of Land rover –
 In the automobile industry factors related to the environmental issues. Company has to
maintain its image in the eyes of government where they check the pollution management
by the automobile industry. Wastage of natural resource is the issue to business.
 Increasing CSR activities create competition which is the issue for the firm.
TASK 3
Positive impact on Business-
Political stability help in running operations greatly and smoothly entering into new
markets. Stable inflation rate help in making more investments and getting positive return over
investments. Young age people like to use such services that help company in increasing sales.
CSR activities are great to raise brand image of business. Legal norms, IP laws help in protecting
the details of company.

The company which has established their market and has customers which are loyal to
them such as land rover. Only these companies can enjoy the time of inflation as customers won't
think to buy their products. These companies will enjoy the high pricing as they will set the price
according to their level of profit. The cost of inflation may change the mind of people but it still
maintains the flow in the market which is helpful for the companies to flow its operations
smoothly. As a leading marketer in the automobile industry which have large customer base
which impacts the customers by their pricing and new changes in the product.
On the other hand when there is fluctuation in demand it may disrupt the flow of
business. But at the time of this situation company can focus on other aspects to improve or to
expand and they can try out some experiments to bring a change into the market according to the
taste and preference of the consumers. Land rover needs to change their way of working in a lot
of ways so that they can cope up with the changes that are happening in the market( UK
Automotive International Competitiveness Study 2018, 2018). Land rover in the UK car industry
they have the high demand for the next generation of the compact design luxury SUV which
gives them immense success in UK's automobile industry.
Negative impact of Business
Due to the factors which are affecting the market. It is ruining the goodwill, earning and
share in the market. As competition is tough, there are many companies which are operating in
this industry. That is why it is difficult for land rover to survive and counter the measures such as
increase in cost of raw materials due to inflation and fluctuation in demand. Increase in cost of
products will shift the consumers from buying to low end products and from those companies
who are eating their own costs and selling at low prices.
Ultimately it is a loss for the company as it will not take the company anywhere and it
will not grow in any market. These all factors will lead to shift their employees as if the company
is not earning as per the expectations then they cannot provide their employees with a decent
package. Land rover is still facing the effects of recession which came in 2007 as it has reduced
the flow of money in the market. In result all of this has led to decrease in buying of
products(World Bank Open Data, 2019). Land rover is luxury product and that is where land
rover 3.4 billion pounds in the quarter ended. Mistakes related to the parts of the which needs to
be maintain because they require high maintenance and it becomes complex when it is imported.

The depreciation on the land rover decrease there cost very high, so creates the concern in the
mind of customers.
TASK 4
REFLECTION
In this study the data collection on the land rover is too hard and I face such problems
regarding the collection of data. The research method I use is secondary data from different types
of article I used that data in my report. Reading and learning about the automobile industry how
they put their impact on the automobile industry of united kingdom's economy. I've collect such
useful and interesting information about the car industry which impact the political factors of any
country. Now I am very much interested to work with the multi nation company, I want to know
more about the working culture and there workforce. I went to my mentor to seek guidance as it
is hard to get all information, without her I am sure that I would have not been able to complete
the report. She provided me with data which was related to the questions that were asked in the
report.
I understood every question from her so that I can analyze it and give the suitable
answers. I have gained very rightful information while working on this project and now I possess
every bit of knowledge that is related to automobile industry. Land rover is one of the best
company in the auto mobile sector which makes one of the best SUV's in the industry and people
are very interested in buying the SUV'S. Working on this project has made me realize that I want
to make a career in this industry. In automobile industry there is high competition in the market
as the land rover's competition is described the study, which puts large impact on the company .
With the idea I have to learned the managerial skills so that at the beginning stage I can manage
my team and then with time if everything goes well which I know it will then we will set up a
team and assign a manger to look out various departments
My plan is to start with offering products of furniture which are of low end to medium end
as it will require less money to start and the number of buyers in low end sector is comparatively
high than high end products. I have thought to maximize the sale and earn on that because
earning high amount of profit at the beginning stage is not easy and it will not attract many
buyers. With time when I have made the name of my brand in the market and I have confidence
that I have established it in several markets then I will go on to expand the company and start
offering the range of high end products so that I can also compete with companies such as land

rover. I got to know during this study about the land rover's different product, also I have seen
such amazing cars which are available in the market like ford, Toyota and many more.
CONCLUSION
According to above study we found the factors which affects the automobile sectors and
land rover PESTLE describes the differences and challenges which company has to face in the
market. All these economic, political , social factors affect the business positive and negative
both manners. Hence companies need to take of these components and have to ensure to develop
great strategy so that it can gain success in the market. In the end I mentioned my reflection
during researching. Overall skills development in me are reflected at the end of study and also
my weakness are also shown in this assignment.

REFERENCES
UK Automotive International Competitiveness Study 2018. 2018. [Online]. Available through
<https://www.automotivecouncil.co.uk/2018/11/uk-automotive-international-competitiveness-
study-2018/>
Hong Kong Expects First Annual Recession Since Global Financial Crisis. 2019. [Online].
Available through <https://www.bloomberg.com/asia>
financial times. 2019. [Online]. Available through <https://www.ft.com/>
Business, industry and trade. 2019. [online]. Available through
<https://www.ons.gov.uk/businessindustryandtrade>
World Bank Open Data. 2019. [Online]. Available through <https://data.worldbank.org/>