Global Business Environment Assignment (Solution)

Added on - 05 Oct 2020

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Global Business Environment
Table of ContentsINTRODUCTION...........................................................................................................................4TASK 1...........................................................................................................................................4a) PESTLE Analysis...............................................................................................................4b) Porter Five Forces of Eastern European Car Manufacturing.............................................7CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONThe global business environment can be defined as the environment in differentsovereign countries, with factors exogenous to the home environment of the organization,influencing decision making on resource use and capabilities. It encompasses the taskenvironment of an organization that are being influenced through global forces. Present reportwill have based on the case study of Car Production Surges in the Eastern Europe. The study willprovide the upward movement in the production of cars in Europe. It has been analysed that theproduction of cars in Eastern Europe is on peek. It will also create more manufacturing jobs inthe four major Central European countries, where the number has already risen to 284,507 in theyear 2004.TASK 1a) PESTLE AnalysisPolitical factorsSupport by governmentAs the auto mobile factories in Eastern Europe provides employment to almost 3500 people forwhich they are gaining support of government. Also, these factories promoting sales whichdirectly affects GDP of Eastern Europe.Low tax on wages and profitsGovernment offer financing to investment on low simple and flat tax that is highly depended onwages of employees and corporate profits. By this more opportunities raise by the governmentand they tend to invest more.Government support to local auto makersSkoda and Dacia were getting support by Government. The auto makers of Czech republic andRomania were bought by western car-makers. This saves them from ruining and hence motivatesthem by getting acquired.Economical factorsCheap laboursAfter 1989, Skoda was a local auto maker which was acquired by Volkswagen and another localauto maker was Dacia which were bought by Renault. By these companies need huge laboursand labours at Eastern Europe is cheapest among all regions.Increase in Employment
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