Competitors and Challenges of Mercedes Benz : Report
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Added on 2020-07-23
Competitors and Challenges of Mercedes Benz : Report
Added on 2020-07-23
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Mercedes Benz
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1Competitors of Mercedes Benz..............................................................................................1Competitive advantage...........................................................................................................2Porter's five forces analysis of Mercedes Benz......................................................................6Change in position of Mercedes Benz in the recent years......................................................7Own opinion for succeeding in next 2-5 years.......................................................................8CONCLUSION................................................................................................................................8REFERENCES................................................................................................................................9Appendices ....................................................................................................................................10Appendix 1...........................................................................................................................10
INTRODUCTIONAuto-mobile is a growing industry and Mercedes Benz is considered as a successfulcompany of this sector. This organisation was found in the year 1926 and they are running theirbusiness across the globe. They are known for their luxury cars and new innovation which isassisting them in retaining top position in premium vehicles. This assignment is based onMercedes Benz. It will discuss about their major competitors and the challenges which they areputting in-front of cited enterprise. Analysis like porter's five forces will also become the part ofthis report. Changes in positioning of firm in recent years will be explained before providing ownoption on the strategy which they can adopt to succeed in forthcoming time. MAIN BODYCompetitors of Mercedes BenzAn organisation that is running their business in different parts of the world has to facecompetition from various players of an industry. BMW and Audi are considered as the maincompetitors of cited company. Both above mentioned organisations are growing but MercedesBenz is holding the top position as they sold almost 20, 84,000 luxury cars in 2016. BMW wason second position and their sale was 20, 03,000. There were two main factors which helpedthem in replacing BMW from the title of world’s biggest premium car maker. Increased sale inChina is the prime reason that they are achieving success in attaining their short term goals.Management of organisation understands that Asia is the region which can assist them in earninghuge profit in less time (Alarcón, Polonio and Sánchez, 2013). Most of the countries in thiscontinent are developing and people living in these nations are getting richer and so they canafford high priced vehicles offered by Mercedes Benz. The second reason behind their recent success is their focus on SUV vehicles. Thissegment is making a significant amount of contribution in their profit. Most of their competitorswere not giving attention to this section which helped cited organisation in exploiting anuntouched division. Other players of this industry are not concerned about the high revenue ofMercedes Benz because their sale and market is also increasing. One of the major threat that theyfacing in the market is related to tightening of rules for diesel cars. This is giving a breathingspace to some local competitors who are providing luxury vehicles in petrol variant. Companieslike Tesla are taking benefit of this issue. They are promoting their cars by playing pollution free1
card (Rodriguez, Doloreux and Shearmur, 2016). Designing of vehicles made by Tesla isconsidered as one of the best that is present in the industry. Mercedes Benz is ready to face any kind of challenge in upcoming time because theyhave done huge investment in recent period especially in research and development department.Cited organisation is focusing on electric cars, they are trying to offer affordable auto-mobile inthe market. Top level management of this company firmly believe in aggressive advertising, theyare very active on social media and television. They are spending heavy amount on makingconvincing advertisements. Normally an enterprise who is offering premium class vehicles donot care about print media but cited organisation always consider it as a significant source ofmarketing (Why Mercedes Will Retain Global Luxury Sales Crown In 2017, And Likely ForYears To Come, 2017). Nowadays, their competitors are also adopting same strategy so they canstand in this tuff competition. China helped Mercedes Benz in attaining top position but other players of this industryare focusing on next emerging market in Asia i.e. India. BMW is capturing luxury segment inthis country by doing aggressive expansion. Most of the experts of this industry believe thatdemand of premium cars will rapidly increasing in this nation (GarcÃa, 2013). Competitors ofcited organisation like Audi, is not allowing them to get a significant amount of share in thisemerging market. Mercedes Benz can use their image and brand name to acquire more part ofluxury car segment in Asian region.Competitive advantageMercedes Benz is known for their work in research and development. They have allotted12 billion dollar to R&D department so they can work on new technology and machinerybecause it can give them some extra edge over their competitors. Top level management of citedorganisation understand that in upcoming time people will prefer luxury cars which can run byusing electricity (Madadipouya, 2015). Innovation is part of their organisational culture,normally an auto-mobile company bring changes in product when they become outdated butMercedes Benz modify their vehicles when they develop a new feature. Instead of advertisingnew specifications in their model, they try to earn trust of their customers. Advanced engineering is providing them competitive advantage, they introduceinnovative ideas in their cars and sell them in market before their competitors start thinking onthat concept. Most of the companies who are operating in this industry still think that mechanical2
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