Environmental Analysis of Automobile Industry - Desklib

This report provides an in-depth analysis of the internal and external factors affecting Aston Martin in the automobile industry. It includes a SWOT analysis, PESTEL analysis, Value chain analysis, and Porters five force model. The report also evaluates the challenges faced by the company in both internal and external analysis. Course code, course name, and college/university are not mentioned.

Environmental
Analysis of Automobile
Industry

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................3
Internal and external analysis of Aston Martin...........................................................................3
Critical evaluation of challenges in internal analysis..................................................................8
Critical evaluation of challenges in external analysis.................................................................8
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Global business environment considered to those elements which effects the organization
functions globally. It includes competitors, consumers, government regulations, suppliers and so
on. The organization which is selected for evaluating internal and external factors in this report is
Aston Martin. It is a multinational car producer company and their products are expensive in
nature (Abbas, 2020). The company was established in 1913 and is headquartered in United
Kingdom. The ultimate purpose of this company is to facilitate highly luxurious product to
customers. This report will prepared with the help of using PESTEL, SWOT, Value chain and
Porters five force model on company's competitive advantage in the market.
TASK
Internal and external analysis of Aston Martin
Internal analysis is a process which is utilized by Aston Martin for evaluating their
capabilities, assets, features, competencies and others. Aston Martin, it is one of those
organization who maintained their brand image between by facilitating comfort and high tech
automated features to customers.
SWOT Analysis -
It refers to strategic planning method which is utilized by company for handling difficult
situations easily within the organization (Alhamali, 2019). In context to Aston Martin,
management used this technique for finding their strength, weakness, opportunity and threat
which are described below-
Strength includes -
 Brand image – Aston Martin have high brand image between in market. Due to effective
brand reputation positive word of mouth are easily spread for their product in other
locations.
 Use of skilled workforce – Aston Martin is always using talented and knowledgable
employees in their work place for serve quality products to consumers. With help of
talented employees durability of their product increased for long time.
Weakness include -

 Limited range of products – Due to high price in their vehicle customers are limited in
numbers. Due to this the lower and upper segment customers are not able to afford these
products easily.
 Small selection range – In context to Aston Martin, management mostly focused on
those models which are single and fully loaded features. It leads to decrease and limits
the customer's choice.
Threat includes -
 Huge competition - Due to various competitors Aston Martin are facing specific
challenges for selling their product (Ari, Karatepe, Rezapouraghdamand Avci, 2020).
Competitors includes Jaguar, Porsche and others are providing the same specifications in
upper customer segments which create threat for them.
 Increasing in fuel cost – In present time the fuel prices are highly which creates threats
for company in their sale. Due to this it is necessary for Aston Martin that they must
design fuel efficient engine for increasing their average.
Opportunities includes -
 New target markets – It is a necessary for Aston Martin that management must focus on
all market segments not only upper class segments. It leads to enhance the profit and
good relations with users easily
 Technology – Technology played major role for attract the consumers effectively. Aston
Martin is used high innovative specifications in their product. This facility is effective for
increase their market share easily.
Value Chain Analysis -
It refers to the group of actions which is initiated by organization do develop value for its
customers. In this process departmental functions are carried through different stages by the
organization which leads to enhance their work efficiency. In context to Aston Martin,
management used this technique to provide high quality services and products to customers in
long run
Support activities -
 Firm infrastructure – Aston Martin established advanced infrastructure for run their
operational and departments functions smoothly. It includes assembly line and financial

management and so on. In this infrastructure various safety standard are followed by
company to maintain work efficiency of employees constantly in effective manner.
 Human resource management – In this process workflow of employees and whole
organizational activities are managed by human resource department. In context to Aston
Martin, management must facilitate all materials and equipments to employees. It leads
to increase their productivity in workplace for long duration.
 Technology – It is a important element for any company to complete the production unit
in time (Das, 2018). In covid pandemic when productivity of Aston Martin get decreased
due to lock down, the AI technology are highly used by organisation for complete the
task in time. In this method machines are fully loaded by the employees which is helpful
to run the activities in last manner.
 Procurement – In this process the raw goods are converted in to finished goods and this
final product are introduced in market in various aspects. It includes fixing affordable
price before delivering, keep effective relationship with suppliers etc. In context to Aston
Martin, due to covid pandemic management must facilitate additional benefits to users to
sell their products easily.
Primary activities -
 Inbound logistics – In this process various internal functions are performed by they
employees within the organization. Distribution of raw materials, receiving, storing and
so on. In covid logistic function of Aston Martin are effectively maintained with suppliers
and employees for complete their production in time.
 Production – Basically it refer to produce or assemble the product with the help of with
help of various equipments in workplace by the employees. In context to Aston Martin, it
is necessary for management that they must facilitate effective training to the employees.
It create awareness about new technology and work efficiency also increased.
 Outbound logistics – In this process final services and products are distributed to
customers in various ways. It includes use of transportation facility etc. which comes
under supply chain management. But in covid the transportation are highly decreased
which leads to decrease the profit of organization for long time.
 Marketing and sales – The main role of this department is to promote their product in
the market between the customers. In this process various strategies which includes

advertising, direct selling and so on. In context to Aston Martin, due to covid it is
necessary for management that they must create their advertisement in large number for
attract customers easily.
 Services – It refers to facilitate best quality to customers at the time of purchasing or after
buying the product (Fuzi, Habidin. and Ong, 2018). In context to Aston Martin,
management always maintained quality in their service. It leads to enhance the positive
relationship with customers for long time.
External analysis is a tool which is utilized by organization for understanding the external
challenges which impact the organization in negative way. Due to this reason management of
Aston Martin used various strategies for evaluating the market which are described below -
PESTEL Analysis -
It is a strategic technique which is utilized by company to describe to explain the macro
external forces. These factors are uncontrollable and create threat for organization in any time
which are explained below -
Political – It refers to those elements which are followed by organization for managing their
political stability easily. It includes regulations and rules, taxation system and various other
policies.
 Positive – Due to adaptation of government tax and other policies in UK their brand
image of Aston Martin are highly popular between public (Ghadimi, Wang and Lim,
2019). With the help of these policies Aston Martin are easily enhanced their showrooms
in various locations.
 Negative – Due to increasing and decreasing taxation system by the government sales of
Aston Martin product are not remain constantly same. It leads to decrease the
productivity of organization.
Economical – In this stage the economic factors are highly effects the organization in both bad
and good manner. It includes employee wage, interest rates and government activities
 Positive – Well established architecture of Aston Martin helped to maintain proper link
between employees and employer or producer or consumer. It is also helpful for
delivering right product to right customers at right time.

 Negative – The major changes in policies of government create bad effect on Aston
Martin in various aspects. It includes decreasing of market share, cost cutting of quality
in their product and so on.
Social – It is a set of those actions which influenced the people attitude, behaviour and desires. It
includes culture and subculture, families and social class groups.
 Positive – Aston Martin is one of the company who analyse the various trends and
cultures of country or people effectively. Then according to that organization produced
their vehicle with unique colour and fashionable seats.
 Negative – Due to their discipline in some location employees are not able to take leave
from Aston Martin offices for celebrate their festival easily. It increasing negative impact
in minds of workers towards organization.
Technological – It basically refer to various technological which is used by organization for
producing the high quality products in their work place.
 Positive – In context to Aston Martin, management must used new innovative ideas with
help of their employees for developing new product. This new product is totally different
from competitors and attract consumers easily.
 Negative – Due to the use of technology competitors easily steel the confidential
informations of customer's and the company (Guo and Yang, 2019). It leads to enhancing
the threat for organization reputation.
Environmental – It related to those factors which creates difficulties for organization in natural
way. It includes population density, food, light, temperature, shortage of raw materials and so on.
 Positive – For decreasing the pollution Aston Martin are using the eco friendly materials
for producing products which includes recycled car parts. It includes aluminium, steel,
copper and so on and these materials are used for made break pads, engine blocks etc.
 Negative - In context of Aston Martin, due to use of carbon footprint at high rate in
workplace productivity are highly decreased of company.
Legal – It refers to government regulations and norms which impact the organization directly
and legally to productivity and company performance.
 Positive – In context Aston Martin, management initiated safety standards in workplace
due to covid pandemic which was implemented by government. It leads to enhance the
work efficiency of employees with out any fear.

 Negative – When organization did not fulfil the wants and desires of employees with
various resources properly. Then their departmental activities are not able to run
smoothly.

Porters five force model -
It is a method which is followed by organization for understanding the competition and
competitive strategies in the market. The various factors which are considered by Aston Martin
for analysing the market are described below -
 Threats of new entrants (Low) – It refers to when organization competitor introduce the
new and unique products in the existing market. It is low in Aston Martin because
management highly focused on quality (Harper, Hendrickson and Samaras, 2018). Due to
this company always facilitates durability in their product to customers for maintaining
the satisfaction level in long run.
 Threat of substitute products (Moderate)- It means that increasing the availability of
increasing vehicle parts in same consumers segments by other competitors. It is moderate
for Aston Martin because their new and old consumers are highly loyal. Due to the trust
of company moderate chances are there for availing services of other organization.
 Bargaining power of suppliers (Low)- It is low for Aston Martin because management
always fixed their price in their product (Khan, S. A. R., 2019). In this price marginal gap
are easily maintained which is facilitate to the suppliers as a commission.
 Bargaining power of buyers (Low) - It is low in Aston Martin because the customer's
are highly loyal towards the organization because customer are gaining durable products
from company.
Critical evaluation of challenges in internal analysis
 Loss of trust – It refers to decreasing the trust between employee and employer or
consumer or producer. In context to Aston Martin, management must provide additional
training, financial and non financial benefits to the workers which leads to honesty and
job satisfaction level towards organization for long time.
 Low productivity – When the relations are not maintained effectively then the
productivity are easily decreased by the employees. In context to Aston Martin,
management must facilitate accurate and meaningful information to workers in
workplace for completing the task in good quality.
Critical evaluation of challenges in external analysis
 Rivalry conflict – In present situation the competition are enhanced between the auto
mobile industry for providing best service to customers (Panigrahi, and Sahu, 2018). In

context to Aston Martin, management must made lot of investment to develop unique
products which is totally different from competitors.
 Use of technology - In context to Aston Martin management must used automated and
updated equipments in their organization for running activities in fast manner. Because
with out use of updated equipments defective product are delivered to users easily which
create impact on brand image.

CONCLUSION
From the analysis of above information it is concluded that global business environment
is a very essential element for Aston Martin for operating their business internationally. When
the business run globally in effective manner then the relationship with employees and customers
are highly maintained for long time. Value chain, PESTEL and SWOT are also used by
organization for understanding the current trends and culture of different locations. Then
according to that services are provided to customers effectively.

REFERENCES
Books and Journals
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p.118806.
Alhamali, R. M., 2019. Critical success factors for green supply chain management practices: An
empirical study on data collected from food processing companies in Saudi
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Ari, E., Karatepe, O. M., Rezapouraghdam, H. and Avci, T., 2020. A conceptual model for green
human resource management: Indicators, differential pathways, and multiple pro-
environmental outcomes. Sustainability, 12(17) p.7089.
Das, D., 2018. Sustainable supply chain management in Indian organisations: an empirical
investigation. International Journal of Production Research, 56(17) pp.5776-5794.
Fuzi, N. M., Habidin, N. F. and Ong, S. Y. Y., 2018. Corporate social responsibility practices in
Malaysian automotive suppliers: confirmatory factor analysis. International Journal of
Business Excellence, 15(2) pp.222-238.
Ghadimi, P., Wang, C. and Lim, M.K., 2019. Sustainable supply chain modeling and analysis:
Past debate, present problems and future challenges. Resources, conservation and
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anaerobic treatment: a case study in Beijing. Environmental Science and Pollution
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environmental, and travel implications of changes in parking choices due to driverless
vehicles: An agent-based simulation approach. Journal of Urban Planning and
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Khan, S. A. R., 2019. The nexus between carbon emissions, poverty, economic growth, and
logistics operations-empirical evidence from southeast Asian countries. Environmental
Science and Pollution Research, 26(13) pp.13210-13220.
Panigrahi, S. S. and Sahu, B., 2018. Analysis of interactions among the enablers of green supply
chain management using interpretive structural modelling: an Indian
perspective. International Journal of Comparative Management, 1(4) pp.377-399.
Reddy, K. J. and Sudhakar, N., 2018. High voltage gain interleaved boost converter with neural
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