SWOT Analysis of Mercedes Benz

This assignment analyzes the strengths, weaknesses, opportunities, and threats (SWOT) of Mercedes Benz (Daimler) using a strategic framework. It highlights Daimler's strong brand image, innovative technology, and research & development investments as strengths. Weaknesses include high labor costs, limited flexibility in board decisions, and declining production of large luxury cars. Opportunities lie in embracing innovations like hybrid, electric, and autonomous vehicles, while threats stem from increasing fuel prices, potential Brexit impacts, and import taxes on Daimler vehicles.

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Table of Contents
Essay................................................................................................................................................1
References........................................................................................................................................3

Essay
Mercedes Benz (Daimler) is one of the biggest German multinational automotive
companies whose headquarter is in Stuttgart, Germany. Daimler is world's largest commercial
vehicle manufacturing corporation which manufactures heavy vehicles like lorries and buses, and
one of the greatest producers of premium luxury cars. It provides various innovative mobility
services like financing, insurance, leasing, fleet management, etc. (Blunck, 2016). Mercedes
Benz (Daimler) have about 3 million employees throughout the globe where its plant exists.
With SWOT analysis, the strengths, weaknesses, opportunities and threats of a company
are determined for achieving success and objectives of a company. It brings in light that an
organisation is healthy or not and helps to know about both internal and external factors that
affects the success of an enterprise (Kompalla and Kopia, 2015). The strength of Daimler is high
investment for research and development which brings innovation in technologies. Daimler
provides innovations in their products for providing their customers with advanced technology
which is safe, fuel efficient and have autonomous driving technology. They have a good brand
image which is associated with quality.
High cost of labour, decline in unit production of big luxury cars and limited flexibility of
board are some weakness of Mercedes Benz Daimler. Due to high labour price, production cost
has increased, because of which prices of automobile and their maintenance is also high.
Production of big luxury car unit have decreased due to which, its supply is low in market. As,
the supply would be low, there would be gradually decline in demand for vehicles as people
would jump on to next available substitutes or competitors product (Grant, 2016). Lack of
flexibility among board is also a weakness of Daimler for its growth.
Daimler has opportunities in the field of innovation in automotive, like introducing
hybrid vehicles, electric and autonomous vehicles. For this, they are investing a huge amount on
research and development activities for developing the latest, high efficient electric motors and
develop a system that could be a leader in market for coming years. They have a great
opportunity for higher market shares in developing countries. Demand for vehicles in Asian
countries are increasing.
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There are certain threats for Mercedes Daimler for its successful business like high
imposing of taxation on the import of Daimler vehicles by importing countries. This would
increase overall cost of vehicle which would lead to drop in sales. Impact of Brexit would also
act as a threat for Daimler, as most of its vehicles are exported to UK. Due to this, Daimler has to
face high currency implications on earnings even if demand is not affected by this. Increasing
prices of fuel in international market can also become a threat for Mercedes Benz Daimler. As
the fuel prices are increasing constantly, large number of customers shifting from luxury vehicles
towards higher mileage automotives or choosing cheaper sources of transportation (Zhikang,
2017).
Through SWOT analysis, Mercedes Daimler can identify their key strengths and
weaknesses and then makes it into an opportunity for its sustainability and for its success.
Threats are determined for making strategic development plans.
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References
Books and Journals
Blunck, E., 2016. Germany BMW's Sustainability Strategy of Evolution and Revolution towards
a Circular Economy. Chapters, pp.83-101.
Grant, R.M., 2016. Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
Kompalla, A. and Kopia, J., 2015. Characteristics of Business Strategies and Management
Systems within Automotive Industry. Ovidius University Annals, Series.
Zhikang, L., 2017. Research on Development Strategy of Automobile Reverse Logistics Based
on SWOT Analysis. Procedia engineering, 174, pp.324-330.
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