Industry Analysis: Strategic Management of Honda Motors with Porter's

This report provides a strategic analysis of Honda Motors using Porter's Five Forces model to assess the competitive landscape of the automobile industry. It examines the bargaining power of buyers and suppliers, the threat of new entrants and substitute products, and the intensity of rivalry among existing firms. The analysis reveals that Honda Motors faces significant threats across all five forces, requiring the company to focus on innovation, efficient supply chain management, and product differentiation to maintain profitability and competitiveness. The report concludes that understanding these forces is crucial for Honda Motors to develop effective strategies for navigating the challenges of the automotive market. Desklib provides this report and many other solved assignments for students.

Running head: STRATEGIC MANAGEMENT
STRATEGIC MANAGEMENT
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Table of Contents
Post.................................................................................................................................2
Industry analysis.........................................................................................................2
Porter’s five forces analysis of Honda Motors...........................................................2
Conclusions related to the analysis............................................................................3
References......................................................................................................................4

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Post
Industry analysis
Industry analysis is mainly considered to be a tool which can help the company and
management to understand the position that it holds in the industry as compared to the other
organizations. The forces need to be understood by the management in an effective manner
so that it is able to develop the services according to the levels of threat. The threats and the
opportunities that are provided by the industry to the company are analysed in an effective
manner with the help of industry analysis. Porter’s five forces model provides an opportunity
to understand the industry and the forces that are able to affect Honda Motors (Meng, Shoulin
& Jia, 2016).
Porter’s five forces analysis of Honda Motors
Bargaining power of the buyers – The buyers in automobile industry are highly
demanding in nature and are able to influence the prices that are offered by the company.
This force is capable of creating pressure on the effectiveness of Honda on a large scale. The
company can reduce the effects of this threat with the
Bargaining power of the suppliers – The automobile industry is filled with huge
number of suppliers who are able to provide the required raw materials. Dominant suppliers
are able to decrease the sales margins that are received by Honda Motors. The formation of
an effective supply chain will thereby play an important role in successful operations of the
company (Dobbs, 2014).
Threats of the new entry – The new entrants in automobile industry are able to bring
high levels of innovation within the market. The lower pricing based strategy also plays an
important role in increasing the power of this force. Honda Motors thereby needs to innovate

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new services and products in order to function in a profitable way within the industry and
mitigate the threats that are posed by this force (Daspit et al., 2017).
Rivalry among the existing organizations – The levels of rivalry that have taken
place in the automobile industry have become more intense in the modern business
environment. High levels of rivalry are further able to affect the profitability and prices that
have been decided by Honda Motors. The company thereby needs to build a sustainable
differentiation with the help of its products in order to face the competition (Demir,
Wennberg & McKelvie, 2017).
Threats of the substitute products – The different companies which are present in
the automobile industry are able to provide many products to the customers which can act as
substitutes. The threat that is faced by Honda Motors due to the substitute products are higher
and the company needs to improve its services in order to mitigate this threat. The needs of
the customer have to be understood in an effective manner by Honda Motors so that the
company is able to provide best services according to the needs (Dobbs, 2014).
Conclusions related to the analysis
The discussion can be concluded by stating that Honda Motors needs to face high
levels of threats from five forces which have been suggested by Porter. The automobile
industry is highly competitive in nature and the forces are thereby able to influence the
operations and productivity of Honda Motors in an adverse way.

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References
Daspit, J.J., Chrisman, J.J., Sharma, P., Pearson, A.W. & Long, R.G. (2017). A strategic
management perspective of the family firm: Past trends, new insights, and future
directions. Journal of Managerial Issues, 29(1), p.6.
Demir, R., Wennberg, K. & McKelvie, A. (2017). The strategic management of high-growth
firms: a review and theoretical conceptualization. Long Range Planning, 50(4),
pp.431-456.
Dobbs, ME (2014), 'Guidelines for applying Porter's five forces framework: a set of industry
analysis templates', Competitiveness Review, vol. 24, no. 1, pp. 32–45.
Meng, X., Shoulin, P., & Jia, P. (2016). Government Subsidies, New Energy Automobile
Industry Market and the Enterprises' R&D Investment-An empirical study based on
exchange option and evolutionary game theory. Review of Investment Studies.–2016.