Porsche Strategic Management: Macro Environment Analysis Report

This report provides a macro-environmental analysis of Porsche within the automobile industry, focusing on key challenges and strategic considerations. Porsche, a German company specializing in sports cars and SUVs under the Volkswagen Group, faces issues related to political and legal factors such as fuel efficiency regulations (CAFÉ standards), economic downturns affecting the sports car segment, social trends favoring luxury and high-performance vehicles, technological advancements, and environmental concerns related to vehicle production and pollution. The report concludes that Porsche must innovate and adapt to these factors to maintain its competitive edge, emphasizing the need for fuel-efficient vehicles and advanced technologies to meet market demands and governmental policies.

Running head: STRATEGIC MANAGEMENT
Porsche
Strategic Management
8/3/2018

STRATEGIC MANAGEMENT 1
Table of Contents
Introduction................................................................................................................................2
Macro Environment Analysis................................................................................................2
PESTLE Analysis...............................................................................................................2
Conclusion..................................................................................................................................3
References..................................................................................................................................4

STRATEGIC MANAGEMENT 2
Introduction
The aim of this report is to highlight the key issues that are being faced by the Porsche
Company in the automobile industry through macro-environment analysis. Porsche is one of
the well-known companies in the automobile industry in Germany and specialized in
manufacturing Sedans, Sports cars, and high-performance SUVs. The company was
established in 1931 with headquarter in Stuttgart. The business is managed under
Volkswagen Group. Present line-up of Porsche Company is comprised of 911 Macan,
Cayenne, and Panamera, and 718 Boxster/Cayman. The company has 24,481 employees
across the world. It has earned €21.533 billion revenue in 2015 by offering services across
the world (Porsche, 2018).
Macro Environment Analysis
PESTLE Analysis
Political/Legal- Economic downturn has arisen many issues for the automakers mostly in the
section of a sports car. However, Porsche is putting its maximum efforts to manufacture fuel-
efficient vehicles but the government of the United State is not satisfied and regularly
pressurizing the makers of the car. The mpg requirement for each ear in the US has been
increased due to the implementation of the policy i.e. CAFÉ (Corporate Average Fuel
Economy). The policy states that the manufacturers and importers of the automobile should
possess a 39 mpg rating and defilement of this rule will result in penalties (Department Of
Transportation, 2017).
Economic- In the 20th century, the segment of sports car has faced huge economic despair.
The economic downturn had resulted in the bankruptcy of different businesses and the

STRATEGIC MANAGEMENT 3
economy dealt along with recession has created a negative effect on the industry worldwide,
which has given rise in the fuel prices.
Social- In the industry there are irregular and fewer fans of the sports car. The buyers of these
cars are intrinsic and conscious towards the luxury and high-end market. Due to the
distinctive traits of personalities of these buyers, they are attracted towards vehicles that
provide them excitement and fun.
Technology- Regular innovations are required in order to flourish in the segment of the
automobile and particularly in the sports car segment, which requires advanced technologies.
As the time is changing, the technologies are also getting advanced and therefore assisting all
kind of businesses that are part of the automobile industry (Pratap, 2018).
Environment- Automobile affects the environment in different ways. The environment gets
affected at the time when a vehicle is created and get ready with its scrap page. The policies
and law associated with the pollution have now become strict globally and in fact, in some
markets businesses has paid high penalties for the products that are unable to meet the criteria
(Pratap, 2018).
Conclusion
In the conclusion, it can be said that Porsche is one of the top players in the segment of the
sports car and provide the best services to its consumers. However, it deals with various
major issues from the factors such as political, environmental, and social factors. In order to
survive in the market, it has to bring a new and innovative vehicle with advanced
technologies in the market. Moreover, to follow the government policies it has to
manufacture vehicles with 39 mpg rating.

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References
Department Of Transportation. (2017). National Highway Traffic Safety Administration.
Retrieved from https://www.nhtsa.gov/sites/nhtsa.dot.gov/files/documents/nprm_cafe-
fines-03262018_0.pdf
Porsche. (2018). The Porsche legend. Retrieved from
https://nerdyturtlez.com/tutor/order.php?id=775013
Pratap, A. (2018). Obtaining a Competitive Advantage in the Automobile Industry. Retrieved
from https://www.cheshnotes.com/2018/03/obtaining-a-competitive-advantage-in-the-
automobile-industry/
Pratap, A. (2018). PESTEL/PESTLE Analysis of Volkswagen AG. Retrieved from
https://www.cheshnotes.com/pestel-pestle-analysis-of-volkswagen-ag/