Challenges Facing the Automotive Industry

Research Methodology

Table of Contents
Title : Challenges faced by auto mobile companies and ways of solving problems.......................3
SUBMISSION 1: Research design Proposal...................................................................................3
Chapter 1: INTRODUCTION.....................................................................................................3
Chapter 2: Research methodology..............................................................................................5
CHAPTER 3: Data analysis........................................................................................................8
CHAPTER 4: ETHICS AND VALUES.....................................................................................9
SUBMISSION 2: LITERATURE REVIEW.................................................................................10
Chapter 1: Introduction of Literature review............................................................................10
Chapter 2: Literature review main body...................................................................................11
Chapter 3: Literature review conclusion...................................................................................16
REFERENCES..............................................................................................................................18

Title : Challenges faced by auto mobile companies and ways of solving
problems
SUBMISSION 1: Research design Proposal
Chapter 1: INTRODUCTION
Auto mobile manufacturing companies is an iconic form of Malta manufacturing
as it is an important part of the economy. All small, medium and large auto mobile
manufacturing are playing a key role in generating economy. This industry has to face
several problems due to some factors like changes in demands of customers, political
stability/instability, environmental factors like carbon emission, changes in regulations,
taxes etc. Globalization is also creating several problems for auto mobile industry as it
does not have only negative impacts but also give positive impacts. Many auto makers
and companies like BMW, Volkswagen has to deal with the new emission
measurements system which can even increase their overall operational and production
cost.
Background
This present study is based on Bayerische Motoren Werke (BMW) which is a
German multinational company. It is mainly known for its excellent features of auto-
mobiles and motorcycle production. The founder of this company is Camillo Castiglioni
and Karl Rapp and founded year is 1916. It serves its services to worldwide and has
produced approximate 2,541,536 vehicles. This present study is going to show some
challenges which are on rise and being faced by several auto mobile companies
including BMW. It also shows some ways as well as strategies which can solve all

problems and challenges of BMW that affect its profitability and create barriers in the
path of its success.
Aims and Objectives
Aim:
“To determine several challenges faced by auto mobile companies and
ways to solve problems: A case study of BMW”
Objectives:
 To identify main challenges which decrease the profitability of BMW.
 To identify critical impacts of problems which are being faced by BMW.
 To identify ways and strategies to resolve problems.
Research question
1. What are main challenges that decrease the profitability of BMW?
2. What are some main impacts of problems that BMW face?
3. Which strategies and ways can resolve problems that auto mobile
companies face?
Problem statement
In the context of problem for conducting this research and proposal, researcher
may face problem related to cost. Auto mobile industry is vast and increasing rapidly so
it can take too much time and cost in research and development. There are several
problems that are being faced by BMW as well as auto mobile companies and to get
each problem in detail can be more time-consuming. Some informations which are

being collected from secondary and primary research they are not adequate and
appropriate all the time, so there is a requirement to analyse all those data which can
increase operational cost of the company.
Rationale
This topic is so interesting as auto mobile industry is on boom, and they are
facing several problems. Everyone wants to know reasons behind problems and this is
the main aim of selecting this topic. All problems which are being faced by auto mobile
companies can directly impact on the economy which is not good for people and these
companies, so by conducting this research some ways can be identified of solving
problems.
Chapter 2: Research methodology
Research methodology plays an integral part in research proposal as it involves
a systematic approach of conducting research on a particular topic. It refers a
systematic method that is being used by researcher to identify, select, process as well
as analyse all required informations. It is the main tool which allows researcher to
identify authenticity and reliability of the whole research project. Some steps which are
included in this methodology are described as follows:
Research type: Types of research allow researcher in identifying ways of solving
practical problems. There are mainly 2 types of research such as qualitative and
quantitative. Both types of research play an important role in conducting research.
Selection of the appropriate and the best research according to the topic make the
research successful and help the researcher and the company to accomplish their pre
determined goals. In the qualitative type, researcher tries to get a better and deep

understanding about the topic on which he/she conducts research (Newton and
Burgess, 2016). It is called non-statistical method because researcher collects
informations via: interview, focus group etc. It provides each and every detail and insight
into the main problem relevant to the topic and also provides appropriate solutions by
developing ideas. On the other hand, quantitative type of research is all related to
number or numerical data. It is a systematic approach of collecting data. With the help
of observation, online survey, researcher can collect this type of data and informations.
This type of research is being used in social science. For this research proposal and
further research, researcher will select qualitative type according to the topic.
Research approach: Research approach can be defines in a simple manner as
a procedure that includes some steps of a broad assumptions to detailed methods of
collecting data. There are mainly 2 types of research approach such as inductive and
deductive. Both approaches play an important role and being selected by different
researcher according to the type of its research. Research approach plays a vital role as
with it help of researcher may process its further steps that are involved in research
methodologies (Alase, 2017). Deductive approach is all related to existing and testing
theory. With the help of deducting approach and analysing existing theory, scholar test
hypotheses that is being emerged from that theories. It is not as much relevant as
inductive approach. Inductive approach is related and concerned with developing new
theory. In this type of research approach, scholar tries to collect all relevant data on
their own basis. The main aim of selecting this approach is to increase and develop own
understanding and knowledge regarding the topic. For conducting this research and
proposal, inductive approach will be used by scholar.

Research philosophy: Research philosophy means to increase as well as
develop understanding and knowledge. It shows the way of collecting data in an
effective manner. For collecting data it has being divided into 3 categories such as
positivism, interpretivism and realism. Positivism is all related to positivity and
according to this philosophy researcher believes that reality is stable. It is also based on
quantifiable observations which leads to analysis of statistical. It is known as a long
tradition. Interpretivism is all related to subjective interpretation as researcher requires
to interpret all elements of the whole study (Hughes and Sharrock, 2016). So it can be
said that this philosophy integrates human interest into a particular study. This
philosophy is being derived from social action theory in which interpretivists individuals
are complex and different people understand the same objective reality. On the other
hand realism philosophy believes that data can be achieved effectively by being
independent and focus on assumptions of a scientific approach in order to develop
knowledge. The selection of philosophy is all related with the type of research whether it
is qualitative or quantitative. This research type of qualitative, so researcher will make
an effective use of interpretivism research philosophy.
Research design: Design is also plays a vital role in the whole activity of
conducting research. It can be defined as a framework of some techniques which are
being selected by scholar in order to combine all components of research in a logical
manner. There are mainly 4 types of research design such as descriptive, experimental,
non experimental and correlation al. The main aim of including this step in research
methodologies is to explain the type of research (Wang, 2015). It has several
characteristics such as reliability, neutrality, generalization as well as validation. In the

type of descriptive, researcher describes the situation and the problem of research for
which they conduct research. Experimental is being used to maintain and establish a
relationship between the main cause and effect of a situation on a particular topic for
getting better solutions. Correlation al type of research design also helps scholar to
establish a relation between two strong relevant variables of research.
Sampling: Sampling also plays a vital role in conducting whole research. For
getting more relevant and authenticate informations researcher target and select a
sample by which they can ask some question related to the topic. In this context the
main topic and aim of this research proposal is to identify some challenges that are
being faced by auto mobile companies including BMW. By sampling and target some
people out of the population is the research strategy of collecting informations. For this
research, scholar will make an effective use of random sampling. There is no proper
strategy as well as authority to know more about the views of employees of BMW about
challenges which their company are facing (Lohr, 2019).
CHAPTER 3: Data analysis
Data collection: Data collection is called the main tool which make the research
successful. Without collecting relevant data, researcher can not even complete its
research. The main aim of conducting research is to get informations and knowledge
about the particular topic. There are 2 methods of collecting data such as primary and
secondary (Yeakley and Caballero, 2016). Primary data are those informations which
are not being used before and it is being collected by questionnaire and survey. On the
other hand secondary type of data includes those informations which are being used
before by different researcher, students and even businessmen. Some sources of

collecting this type of data includes: Internet, Books and journals, articles etc. By
collecting relevant data from relevant and primary source, scholar can make an effective
decision about its topic.
Data analysis: After collecting relevant data from relevant source, it is important
for researcher to modify and analyse them for making them more authenticate. By
analysing and modifying collected data, researcher can make a successful research
and can make readers believe that he/she have proper and vast knowledge about the
topic on which he conducted research. It also has 2 types such as qualitative and
quantitative (Menke, 2018). The selection of data analysis and tools is depended on the
type of research. SPSS tool is being used for quantitative research.
CHAPTER 4: ETHICS AND VALUES
Ethical consideration:
Ethics means norms, value that are important to think about in any type of field
and research project. By concentrating on ethical consideration, researcher can identify
the difference between the right and the wrong (Crivello, 2015). There are some points
which need to be considered by researcher while conducting research:
 There is a requirement by researcher to respect each participant and member
involved in research directly and indirectly.
 To maintain the privacy of each member.
 They should not force any participant for taking an active part in research.
 They need to ensure to maintain any type of misbehaving towards research
project.

 To maintain an active and effective communication between researcher and
participants to make the research successful.
SUBMISSION 2: LITERATURE REVIEW
Chapter 1: Introduction of Literature review
A literature reviews is a secondary research and refers a scholar paper that
includes understanding and current knowledge and methodologies contribution to a
particular topic. For this research the main topic is identifying challenges which auto
mobile companies including BMW is facing. After identifying challenges there is a
requirement to provide better solutions for problems. In the literature review main
research questions are being focused and tried to give each answers with the help of
different point of views of authors. As it is a secondary source, so do not focus on new
as well as original experimental work. It also shows reader and students about
researcher that they have a deep and vast knowledge about the topic. It also helps
researcher in identifying that where the research fits into and adds to an existing body of
agreed knowledge (Davis and et.al., 2015).
In other words it can be defined as a summary of different sources. It covers
almost all topics and questions relevant to the particular topic on which scholar
conducts research and tries to accomplish organizational goals. In this context the main
aim of auto-mobile companies and BMW is to increase profitability by solving all those
problems which are on rise and they are facing. The main aim of writing a literature
review is to consume time and give an overview about the topic rather than conducting

the whole research. It seems an important report for professionals and organizations as
they can become up to date by reviewing and analysing this. They can also know that
what is going on currently in the market they do not require researching, so it can be
said that it saves their time.
Chapter 2: Literature review main body
It will contain and show answers of all research questions which can help
researcher to accomplish its main aim. With the help of developing 3 themes it will show
some problems and challenges which auto-mobile companies and BMW is facing. It will
also show impacts of all those challenges along with ways of solving them.
Theme 1: Identifying main challenges which decrease the profitability of BMW
According to the Author ( Xiaoshan, 2019) there are many challenges which are
currently BMW company is facing like Overcapacity, sustainability, globalization and
urbanization. BMW is an automobile company and they can face UPS and down in the
market. They are already investing on the material to build high quality cars. BMW is
an seller of an luxury cars and It is not possible for everyone to purchase this brand can
so they have to make limited cars to sell in the market overcapacity in the
manufacturing can create problem for them because it will be challenging for company
to sell those car on the market they have to manufacture according to their plane. If they
make more they demand then it will affect on their probability.
According to the Author (Li, and et.al., 2017) BWM car is selling their car in all
over the world but there are many new competitors come in the global market, and
they are selling new Luxury cars in lower price , it is challenging for BMW to compete
with them and even they have old competitors who are making new design of the cars

and giving competition to the BMW company . They are using high quality materials for
their car, and they are only famous because they use better quality are provided better
design for their customer in all over the world If they decrease price of the cars then
they can it will be directly effect their profitability, and they can suffer from losses.
According to the Author (Potti, and Saurav 2020) BMW company have better
manufacturing workforce and car designers but Nowadays many other companies
copy their design and their manufacturing process. That is affecting their profitability
because other who copy their design selling their cars in lower price with same facility
so it is important for them to adopt new designer and new manufacturing process, so
they can make newer design but it is challenging for them to adopt new engineers and
designers because their brand name is already famous, and they do not have time to
adopt new designers and give them training, so they can create new design.
According to the (Potti, and Saurav 2020) many people from the population lives
in a urban area. IN a urban areas most of the people belong to the middle class family
and financially they are not able to buy cars like BMW because BMW makes cars
which are more costly than the other care and it is impossible for them to buy this car.
This is challenging for this brand to sell their car in urban areas they have to see
economic conditions of that area before selling cars in urban areas. If company sell their
cars in those areas then it will be result in decrease in their profitability. They have to do
market research before settle their business in the urban areas.
Theme 2: Identifying critical impacts of problems which are being faced by BMW.
According to the author (Fang, and et.al., 2015) overcapacity impact on BMW
company 's selling they are making cars more than the demand and Employees of the

BMW company are not able to sell the cars to the customers. In a result new trend and
model come in the market and their older stock get outdated. They can not sell their
cars because better facilitates they get in other cars.
According to the author (Lindberg, and et.al., 2016) Globalization is impacting
on the profitability of the BMW company they are facing problem to sell me country they
are getting better profit and some counties they are facing problems to earn profit.
There are many competitors of BMW in the market it is harder for them to hold their
reputation on the market. They are expanding their business to the other countries for
that they have to hire new employees for their business and it is costly for them to hire
employees from other countries.
According to the author (Fang and et.al., 2015) BMW is a growing company, and
they are expending their business with the expatiation of the business they need more
workforce for their manufacture, and they need new designers for new models to
compete with their competitor. It is impacting on their profitability because it cost too
much if they hire new employees and establishment of business also cost to match, so
they are hiring employees from countries where they can get employees cheaply but
BMW have to provide all the facilitates for employees like their food, clothes and many
more facility which is basic need of the employees. Due to changing trends in this
industry, people generally do not prefer to come in this industry. Employment rate can
also have a negative impact on this industry in getting enough and skileld workforce that
can help them out in accomplishing their goals. Some companies do not pay enough
salary to employees as per their work and qualification which is also stated the main

reason of facing this problem. For providing better solutions it is important to identify
reasons on which basis they can take corrective actions.
According to the author (Xu, and Liu 2018) Urban areas impacting in the growth
of BMW company they are not able to increase their growth in urban areas of some
countries because there are very less opportunity in this area they cannot be successful
in the urban areas most of the countries like India, srilanka. BMW can' t expand their
business because most of the parts in those countries are urban. People in urban area
want better vehicle in less price with a increased mileage but BMW is only manufacture
expansive cars with high cost and it is impossible for people in rural areas to buy this
company cars. Even BMW can give vary low mileage around 8 to 10 K/L. In the result
they suffer from loss in the rural area they need to make new strategies like they need
to make cars which can be suitable and reasonable for middle class families, so they
can also buy car like BMW and this will be very beneficial for the company if they make
cars for lower class which can give better mileage In low rage price this strategy can
make them successful in their business so company should apply this strategy for the
better growth.
Theme 3: Identifying some ways to resolve problems
As it is stated that auto-mobiles companies and BMW face several challenges
like rise of globalization, sustainability, changes in demands of customers etc.
According to the Zhang, X.Q. (2016) stated that fear of change and urbanization is one
of the main problem which BMW is facing. For solving this problem they gave some
suggestions and ways that companies including BMW need to adopt new and advanced

manufacturing technology rather than using simple automation technology. There are
huge demand of BMW products, so it needs to more focus on research and
development for making its products and services more innovative. Driverless vehicles,
artificial intelligence are called advanced technology in the context of auto mobile
industry. Pioneers should also make an effective use of their lead in data and IP
stockpiles to secure regulatory approval. Those countries who mainly rely on
automotive industry for increasing economy they can see the huge changes and
profitability in economy.
BMW also find difficulties in finding skilled workforce due to the skills' gap. This
auto mobile industry is continuous changing industry that is why people do not prefer to
work in this industry. They also have fear of job loosing and security. For giving ways for
solving this problem it is important to identify the reason behind this problem. The main
reason of this challenge is increased used of technology. BMW and other automotive
companies make an effective use of AI and industrial robots that decrease and replace
humans for wielding. For solving this, it is suggested by Gardelis, Lalos and Moustakas,
(2018)that the company should make less use of these type of technology and provide
training to its existing as well as new appointed employees. By providing adequate
training and benefits to them, they can retain skilled and potential workforce within its
organization. Employees are the main key of business's success, so the company
needs to be customers and employees oriented rather than task oriented. Re-evaluation
of recruiting practices is another way of solving this problem.
Rise in globalization is a threat for BMW as it can lower market prices for some
vehicles. It increases competition and for that the company requires to make

themselves more able to expand its business. It is suggested by Clinton and Whisnant,
(2019) that for being in the competition and surviving in global market, there is a
requirement for the company to increase efficiency in its products and also need to
ensure that they have proper knowledge about supply chain, foreign markets as well as
other operational strategies. For that they also need to use advanced technology which
can help them in making their products and services more innovative. By making
sustainable, eco friendly vehicles they can attract wider range of customers around
the world. By adopting the latest technology, it can satisfy changing needs of its
potential customers. It is also stated that BMW is expected to increase its fuel efficiency
approximate 20% and as much as 60% up to the 2020. They also need to make sure
that they will keep environmental footprints as small as possible in the process of
manufacturing.
Chapter 3: Literature review conclusion
From the above report and literature review it has been summarized that
literature reviews played a vital role and a tool by which researcher gave answers of
each research questions in detail. With the help of different supported views of authors,
all answers related to the topic of identifying all those challenges which are being faced
by auto mobile industry are being given efficiently. It has also been concluded that
literature review are quite different from an academic research paper as it gave an
overview of the whole topic and detail about the current trends which are going on in the
market. For most research papers and scholars comprehensive knowledge of literature
played a vital role. It made narrow to the topic as scholars and readers did not have to
research about the topic for getting understanding and knowledge. With the help of

literature review or topics supported by different views they have accomplished their pre
determined goals of identifying some challenges which are being faced by auto mobile
companies. By following each step of writing literature review, researcher save their
time and cost of conducting the whole research. From this literature review on the main
topic it has also been summarized that it has several ways of solving each problem
related to rise in globalization, sustainability, changing needs of customers, urbanization
etc. Solutions which has been given included training to employees, increase use of
advanced technology which solved all current problems of auto-mobile companies.

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