preview

Automobile Industry

Better Essays

Did you know that all the companies in America have something in common? They are all operating in an environment of forces that create both threats and opportunities for their businesses. These environmental forces, which make up something known as the "macroenvironment", include: demographic, economic, natural, technology, political and cultural. Since the macroenvironment is generally uncontrollable, businesses often must find ways to adapt to the constant changes. For example, over the past few years, the auto industry has been affected tremendously by changes in the technology, natural, and political environments and therefore forced to change their marketing strategies.
The Technology Environment Kotler identifies the technology …show more content…

(See appendix A).
How the Natural Environment Has Affected the Auto Industry The increased gas mileage offered by the hybrid car would be increasingly important during the first decade of the 21st century because while technology was increasing so were the prices of natural resources such as oil. Between 2000 and 2006 there was a shortage of crude oil which created fierce competition among the gas companies (Maple leaf web). As a result, gasoline prices skyrocketed to over $3.00 a gallon in most areas of the country. Immediately, the increase had a profound affect on the nation and sparked a change in consumer buying behavior. In fact, a study from Harris Interactive and Kelley Blue Book Marketing Research, indicated that after the steady price increases, 41 percent of in-market car buyers either changed their minds about the type of vehicle they would purchase and were thinking strongly about buying vehicles they normally wouldn't consider. Thirty percent of car buyers also reported that if gas prices continued to rise by even a mere 25 cents, they would buy a more fuel efficient vehicle (Kelly Blue Book). Statistics have confirmed these consumer statements, showing a decline in large SUV and truck sales. By the end of 2004 the GM Hummer sales had declined by 25 percent (Kotler, 97).
How They Political Environment Has Affected the Auto Industry Unfortunately the shortage of oil was not the only concern regarding the

Get Access