Car Industry Australia Essay

Rivalry: If barriers to leaving an industry are high, firms will exhibit greater rivalry and lower prices. High exit barrier forces firm to stay and compete for market share to survive and sustain..

The automobile has become an important part in our nations economy. In fact such an important part that is has called for many changes through out its history. One of the main changes is the body. In the 1950's the body was made mostly of steel. This was okay if you like bulky, heavy, gas guzzling cars. The main reason why steel was so widely used is that the steel industry was so huge and steel was so cheep that it was the logical thing to use. However with all the advances in plastics it did not make sense to use steel when a lighter more durable substitute became readily available and much cheaper. Steel is still used though today because of its strength and protection to the passengers.

A threat of substitutes exists when a products demand is affecting by a price change in a substitute product. For example, Burger King taking the place of Chipotle in the market. In the Porter model, the threat of substitutes usually impacts an industry through price competition. This happens primarily because Burger King or any other food joint can offer better prices i.e. lower prices of products than Chipotle. Even though, both food joints largely deal with very different products, there is always a threat that a substitution can take place if one food joint stays out of the market space a long time. Also, if you look at the industry as a whole, people do not specifically choose to have tacos over burgers, it essentially comes down to which fast food joint will be less heavy on the consumer’s

For any new entrant considering about entering into this industry to compete and to take over what Porsche had achieved, they would have to have strategically consider and plan before making decision. To analyse the competitiveness of Porsche in the automobile industry, Porter’s 5 force framework was used as illustrated in Figure 1 below.

When looking at this case scenario there seems to be only one possible outcome for this scenario. Jeff was underage at the time of contract and under the law this contract was not valid.

The United States recession (which lead to a world recession), began in 1997 and significantly impacted the United States automobile industry during the recession period. The United States automobile industry is still reeling from the effects of the recession throughout the period of economic recovery that continues today. According to Chu and Su, “In this credit-driven recession, one of the hardest hit sectors was the automotive industry, along with the housing and financial markets. Chrysler and General Motors were pushed into bankruptcy; and 276,000 jobs in the automobile and parts industry were destroyed, a whopping 36 percent of the total employment in the sector”.

challenges, however, are the most difficult ones to face and overcome. Some environmental issues that

The owner and founder of Toyota is Sakichi Toyoda is born 1867, and In 1890 he invented the Toyoda wooden hand loom, Sakichi Toyoda in 1896 invented the power Loom, invents the circular Loom and in 1924 Sakichi Toyoda, invents toyoda Automatic Loom, Type G with Non- Stop shuttle-change motion, In 1926 Toyoda Automatic Loom Works, LTD now become Toyota Industries Corporation and established to manufacture and market Automatic Loom invented by Sakichi Toyota.

Ford goes through the effects of the replacements to its products. This section of the Five Forces analysis discusses the threat of substitution that Ford faces in the

Evaluation of a Strategy for Increase in Car Production The Morgan motor company is a small conservative company that is based in the north of England that is a producer of hand made, high quality cars. The purpose of the strategy is to identify the cause of the problem that is currently meaning that Morgan can only produce around nine cars per week. Despite this the company has much strength in the way that it operates, for example the company has a background of being very traditional. Job production has provided a very highly skilled and committed workforce and has enabled the production of a high quality.

The US auto market is slowing down and will most likely finish below 2016’s peak numbers. Still, somewhere between 16.8 and 17 million new passenger vehicles will likely sell as the books close in early January — that’s still an impressive range.

When there is rapid change in the industry, with such as the need to replace out of date machinery, and incumbents are slow to made needed investments, then this can play to the advantage of new entrants.

If an industry is profitable, it will become a magnet to attract more competitors looking to do same business with us. If it is easy for these new entrants to enter the market, this poses a threat to the firms already competing in that market. Threat of new entrants is one of the forces that shape the competitive structure of an industry (Marc, 2014). A high threat of entry means new competitors are attracted by the profits of the industry and can enter the industry easily. New competitors entering the marketplace can make the market share and profitability of existing competitors more threaten cause the existing competitor to make some changes to existing product quality or price levels. A high threat of new entrance can make an industry more competitive and decrease profit potential for existing competitors whereas a low high threat of new entrance can make an industry less competitive and increases profit potential for the existing

A second point of consideration relating to the intensity of rivalry within the industry was the level of industry demand. “Demand declines when customers are leaving the marketplace or each customer is buying less” (Hill &Jones, 2012, p. 62). This was the case in 2009 in many developed nations due to the recession, which was marked by job loss, credit problems, and high gas prices that increased the demand for fuel-efficient vehicles or left consumers unable to purchase vehicles altogether. At the same time, growth was expanding in China and some other developing nations, which opened the doors for automobile companies in these countries to expand at home and

What is the threat of new entrants and what is the cost of leaving this industry. Leaving the industry should not be the best option but companies should always know the information about leaving the company.