Global Business Environment: Opportunities and Changes in the Electric Car Industry

This article discusses the global business environment and its impact on the production and marketing of electric cars. It explores new business opportunities and organizational changes that may arise in the future. The article also analyzes the competitive forces in the industry and provides a critical assessment of the potential changes to gain a competitive advantage.

Global Business
Environment-1

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Identify new and emerging business opportunities that the production and marketing of
electric cars may present to entrepreneurs and business executives............................................3
Provide a critical assessment of the organisational and other changes that may take place in the
future and the reasons for such changes in order to gain competitive advantage........................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Global Business Environment refers to the environment with various sovereign countries
with various factors of the home environment to the organisation that impact the decision making
of resources and use of capabilities. In that case the Global Business Environment is divided with
the external factor which includes social political economic cultural and other concerning factors
that are influenced by external environment. Moreover Global Business Environment consider
globalisation with itself which is useful in removing various hurdles among the countries and
also useful in increasing efficiency of global resources that leads to change the industry structure
(Brenner, 2018). The Global Business Environment also useful in capturing the current ships of
the global environment for business causes mainly by the destructive nature which impact the
political social and economic changes.
Global environment is considered as a systematic study of present Trends within the
technology ranking towards the artificial intelligence and also provide a prominent vision
towards the model concept to economic thinking including the concept of circular economy and
behavioural economics. In this context Volvo is considered which a Swedish multinational is
manufacturing company headquartered in Sweden. Company deals in manufacturing distribution
and sale of cars trucks buses and construction equipment. More about this report is going to
cover the emerging business opportunity that the production and marketing electric car face and
also identify the business that link with automotive industry and impacted after the launch of
electric car.
MAIN BODY
Identify new and emerging business opportunities that the production and marketing of electric
cars may present to entrepreneurs and business executives
PESTLE Analysis: This Framework is helpful in order to determine the external environment
which is conducted when the company wants to expand their business in other segment in order
to acquire New Market area for the development and increment of profitability and sales
(Rendtorff, 2017). Along with this the prominent determination is conducted for Volvo and
specifically for its product that is xc40 in order to make its Global presence bi dealing and
computing with the large brands in order to increase its market share. In this context several

factors are useful in order to determine the associated risk that impact the company and these
factors are mentioned as under:
 Political: By considering the present time Volvo is at the forefront in terms of electric
vehicles as in this context Volvo tries to eliminate the traditional vehicles who runs by
engine oil and require fuel to run as it generate lot of pollution within the environment.
Currently Volvo use both electricity and fuel cars in order to target their customer.
Moreover the drivers of Volvo use electronic stations to refill their electric car inside of
typical gas station (Kasemsap, 2016). Along with this these electric cars developed within
the market with the permission of government by qualifying the specific text credit rate
for buying an electric car.
 Economical: The sales of electric cars has rise within the global economy as in 2017 this
sale include within the world economy by around 3.5% and considering the area of Asia
Europe and United States. In this context the price of materials are actually on the decline
for Volvo is the cost of batteries are low by which company has prominent profit margin
that leads to increase their sales and overall development of economy.
 Social: The electric cars are developed by considering the people who are environment
friendly and against the engine oil cars as engine oil needs to generate more pollution
which can cause harm to the environment (Lewis and et. al., 2017). In this context
electric cars are cheaper instead of traditional car and sustainable as well. Moreover there
are very few cars within the market that leads to boost the power and luxury of Volvo
electric car xc40. Therefore with the development of electric car company has done an
amazing job in order to retain their customers.
 Technological: For Volvo technology is can be both friend and foe as it is useful for the
company in order to maintain their competitive edge but in the dynamic business
environment. Advanced technology allows Volvo to become more fuel efficient in order
to sustain their future within the electric cars and it becomes possible with the adoption of
new technology automotive industry (Thanetsunthorn and Wuthisatian, 2016). Despite
from this the prominent technology which is used by Volvo can become obsolete with the
advancement of new technology within the market as technology is considered as the
dynamic factor that changes according to the requirement and Trends of customers..

 Legal: Currently Volvo is expanding its business into various market by which they need
to keep up to date regarding their International patent Trademark and copyright and they
also be intercepted by legal issues. Along with this Volvo focus on the eco- friendliness
and also promote their cars by considering the energy efficient and also make sure that it
is divided by the international environmental regulations.
 Environmental: By analyzing the electric cars that is more sustainable and environment
friendly with the market it uses electricity rather than gas. The vehicles of Volvo are
appointed by environmental regulations and barely influence the carbon emission in
comparison to old vehicles. As Volvo focus on the environment in order to made its name
and set prominent standard for their competitors.
Porter’s five forces: This Framework is helpful in order to determine the overall environment
and also analyze the competitive market for the company. It is useful by the company in order to
develop their business strategies by determining several conditions. This Framework has five
significant factors by which three of them include external forces and remaining is related with
internal forces (Hill and et. al., 2017). These forces are helpful in order to conduct prominent
market research that are significant for the company to produce their prominent product by
considering the requirements and demand of their customers along with the qualification that is
helpful in achieving the market area. In terms of Volvo as it has good presence in the Global
market and also leads to increase its presence within the Asian continent with the help of its
hybrid and electric cars and for these prominent forces are determined by considering the
opportunities and threats.
 Threat of new entrant: New entrants within the business environment impact the overall
environment of industry which is useful in analyzing the performance of Volvo. It is
impacted by 5 prominent forces in order to identify the intensity of external factors that is
created by high cost of brand development cost of business and Economics of scale as all
these factors are weak in force in terms of Volvo. For this by considering the business
condition of Volvo it is difficult to compete with specifically with the high cost of brand
development as company has prominent customer base and reputation within the market
(Ganamotse and et. al., 2017).
 Bargaining power of customers: Buyers are considered as the most influential factor
within any industry by considering the automotive battery and solar panel within the

automobile industry. The customers of Volvo are directly influenced with the
performance and sales of company as in that case from the side of customers the
switching cost is low volume purchase is low and substitute availability is moderate in
nature. Therefore low switching cost leads to eliminate the barriers for the customers of
Volvo in order to purchase car from other providers.
 Bargaining power of suppliers: In relation with this the performance of Volvo depends
on the reliability of suppliers as in terms of electric vehicles and luxury raw materials
there are only few suppliers who deals with it. Moreover this aspect influences the
availability of materials by considering the requirement of company (Perry-Kessaris,
2016). In terms of this the intensity of external factors develop moderate force for Volvo
by considering the forward integration size of a players and supply level as all of them
are moderate in nature.
 Threat of substitute: In terms of this Volvo face the influence of substitute product
within the electric and hybrid cars is the biggest substitute of Volvo is Tesla in the
automotive industry. Moreover the intensity of this respect is moderate to high as it can
become threat for the company regarding its sales and purchase of product. As the
switching cost of customers is high availability of substitute products and performance of
substitute is moderate in nature.
 Competitive rivalry: Volvo operators in the highly competitive market which impact the
competition within the automobile industry and leads to develop competition energy
among various organisations in terms of this external factors has prominent intensity that
is responsible for the strong force of the competitive rivalry including the small number
of firm that is low aggressiveness of other companies and switching cost is high in nature
(Chang, 2016).
Provide a critical assessment of the organisational and other changes that may take place in the
future and the reasons for such changes in order to gain competitive advantage
The electric cars are only show about the internal combustion engine as the battery electric
cars comprise around 2.1 % of the Global auto sales. In that case in order to keep the
environment sustain and prevent it from the pollution. As electric cars are beneficial for the
environment because electric cars are useful in reducing the harmful air pollution from the
exhausted carbon emission as an EV has zero carbon emission. Moreover it is sustained with the

renewable energy in order to recharge the electric vehicle that is useful in reducing the impact of
greenhouse gas. In that case the prominent idea is to purchase green power from the electricity
retailer that is useful in recharging the grid from the greenhouse gas in order to reduce the
emission.
Moreover the hybrid cars are eco-friendly material as by considering the trend also. In that
case Volvo focuses on electric car with recycled material that is pending out of bio waste
material regarding their interior bodywork and plastic bags (Civelek and et. al., 2016). Moreover
electric cars has bright future because they are cheaper to run and maintain as the owners of
electric vehicles have the advantage to load sharing cost by considering the petrol of the same
vehicle. Moreover the battery electric vehicles have less moving parts in comparison to petrol
and diesel car.
Along with this the electric vehicles are fuelled by connecting to the electric grid and the
electricity can be produced with the help of several generation methods full stop in that case
electric vehicles allow Volvo to become more energy independent with the installation of
renewable electricity generation including the Solar energy to fuel the vehicles. Despite from this
electric vehicles can also charge at home as well as there is no need to go on the charging station.
Since the electric grid is available within the market almost everywhere by considering the
variety of options for the charging as because of this the user does not need to go to the gas
station.
The hybrid and electric cars are fueled by the electricity from the Renewable Sources
considering hydropower solar energy gasoline and wind that are useful in generating and
extracting prominent energy for the transportation processes (Rendtorff, 2017). In this context
electric vehicles are developed regarding the more environmental friendly instead of traditional
vehicles as the uses of large battery inside the electric car can be recycled and does not harm the
environment. Therefore by opting an electric car can leads to reduce the carbon footprints and
positively influence the pollution impact to help and preserving the natural environment.
Therefore disorder future benefits which Volvo face by developing electric and hybrid cars.
CONCLUSION
Therefore from the above discussion it is analysed that Global Business Environment is
useful for the international businesses by considering various international trade and tariffs for
the company. It is also useful in analysing the impact of various external factors at the time of

expansion of company and also useful in eliminating risk factor from the business. In this context
Product life cycle is useful in describing the various stages of product and also depict the
prominent strategy which is useful in overcoming from the decline stage.

REFERENCES
Books and Journals
Brenner, B., 2018. Transformative Sustainable Business Models in the Light of the Digital
Imperative—A Global Business Economics Perspective. Sustainability. 10(12). p.4428.
Chang, S.J., 2016. Sustainable evolution for global business: A synthetic review of the
literature. J. Mgmt. & Sustainability. 6. p.1.
Civelek, M and et. al., 2016. A model of measurement of the quality of business environment in
SME segment. Journal of International Studies.
Ganamotse, G.N and et. al., 2017. The emerging properties of business accelerators: The case of
Botswana, Namibia and Uganda global business labs. Journal of Entrepreneurship and
Innovation in Emerging Economies. 3(1). pp.16-40.
Hill, C and et. al., 2017. Global Business Today Asia-Pacific Perspective. McGraw-Hill
Education.
Kasemsap, K., 2016. The roles of lean and green supply chain management strategies in the
global business environments. In Designing and implementing global supply chain
management (pp. 152-173). IGI Global.
Lewis, H and et. al., 2017. Design+ environment: a global guide to designing greener goods.
Routledge.
Perry-Kessaris, A., 2016. Global Business, Local Law: the Indian legal system as a communal
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Rendtorff, J.D., 2017. Cosmopolitan business ethics: Towards a global ethos of management.
Routledge.
Thanetsunthorn, N. and Wuthisatian, R., 2016. Current state of corporate governance: global
business and cultural analysis. Management Research Review.