Essay on Demand Elasticity of Luxury Automobiles

This paper is an evaluative look at why the Chevrolet Corvette is one of the greatest sports cars in the world. Sports cars can be judged in three areas; cost, performance, and comfort, each area will be evaluated as to why these criteria are important, with examples shown to for definition. The Corvette will be shown how it compares in regards to the measurements, and in some cases exceeds them. Showing why it should be considered a great sports car

The fourth part of this report will investigate the claim that “smaller cars provide better values than larger cars,” given the provided data. The claim does not make clear what measurement for determining “values” is to be used, but we will proceed with the assumption that Consumer Report’s Value Score is an accurate representation of real-world value. Because we determined that the Size category and the two related ‘dummy’ variables did not have a significant relationship with the Value Score (which caused their subsequent deletion from the equation), and also because Size is largely represented by Cost/Mile—the choice was made to analyze the coefficient for Cost/Mile to help come to a conclusion. We are going to use the following estimated regression equation (which we constructed in Part III) for our analysis:

· The standardization of industry product: Vehicles products are standardized even though we still can find some differentiation between auto companies. For the consumers who feel they can find the equivalent vehicles between companies, they will compare them. However, since there are brand loyalty among the consumers in choosing a vehicle related to its differentiation, the switching costs for consumers may be high. Thus, the bargaining power of buyers seems to be moderate.

         Low repair cost
         Chevrolet:
         The third major player
         $60 million ad promotional budget
         Emphasized quality and style
         Consumer perception to this car is an average car. 
         Low repair cost, head/leg is roomy, fairly fuel economy
         GEO:
         Consumers’ perception are low
         3 models: Geo Tracker, GMC Jimmy, and GMC Yukon.
         Honda
         3 models:  Honda Passport, Isuzu Rodeo, and Isuzu Trooper
         Consumers’ perception in terms of quality, safety, performance, off-road capability, aesthetics, comfort, economics, and status were rated average among all SUV brands.
         Good complaint rating and warranty coverage.
         Kia, Suzuki Sidekick
         Only one brand
         Consumers’ perception ratings were the lowest in almost all criteria. 
         Mitsubishi, Olds Brvada
         Only one brand
         The rating was low
         Good seating capacity but limited cargo space,
         Nissan
         Only one brand
         Consumers’ perception was good.
         Good complaint rating, small cargo space, roomy head/leg room, and low towing rating.
         Toyota
         Offer two brands:  4Runner and Land Cruiser
         Consumers’ perceptions were high in terms of quality, safety, off-road capability, and comfort.  However, the rating of economics was low.
         Land Cruiser was very

A Chevy Aveo 2007 was my first car or as I called her Dipsy. When I walked outside my house and saw this tiny little dazzling gray hatchback vehicle sitting in my driveway having a gigantic bright pink bow on the roof, I fell in love. The car reminded me so much of a teletubbie I had to name it because it has an antennae that stuck straight up in the air like the teletubbies had on their heads The paint had begun to fade, I thought it only added character. I sprinted to the driver side door and plopped down in the bucket seat. I began to examine the blue and black interior. The seats had a black print with a few scattered dark blue squares on them matching the cloth on the sides of the doors. When I went on my first ride, I turned on the a/c and hot air was blowing. I rolled down the windows which are manual so you literally had to roll them down. Once you hit a certain speed, my car liked to make funny little noises that I just ignored and overpowered with music. I wanted to play my music off my phone and noticed there wasn't an AUX input plug in. The doors weren't automatic either, you have to push them down with your hand. This car had the simplest package you could get, but I loved my perfect little box-shaped hatchback.

The rental car industries as well as other industries within the travel market are challenged with developing a pricing strategy that will maximize profits for the firm. In our analysis of three firms, Hertz, Avis and Budget, our team used qualitative and quantitative methods to develop an understanding of their pricing strategies. We wanted to determine which company has the best overall pricing strategy. Furthermore, these methods helped us develop recommendations involving segmentation and brand differentiation that will help these rental car companies insure greater profitability through pricing that will minimize consumer surplus. Our examination of the three rental car companies and their pricing strategies begins with industry and

The industry for superior luxury cars is a highly exclusive one with a few automotive makers making their presence felt. The major market share is held by Porsche which is known to have formidable rivals like Benz and BMW. The SUV supercar segment is a highly evolving one where manufacturing style localities and units are the decisive forces that ultimately culminate towards the cost of the car.

According to the respondents’ perceptions, the infinity G20 and the BMW 318i are almost a like. BMW’s attractiveness is slightly higher. Both cars fall into the category of the best-built cars. Subsequently, respondents think that the two

Purchasing a new car is considered a luxury purchase, making it a highly influenced decision by reference groups on the product choice and the brand selected. As purchasing a car is a high-involvement purchase, normative and informative influences

In recent decades, Aston Martin has developed to be an iconic marque symbolized with luxury and elegance since 1913 (Aston Martin, 2015). However, Aston Martin has slowed down the market demand in Europe and North America (KPMG, 2013: 12). Nevertheless, Aston Martin plans to do an investment to expand the global market (Tift, 2015), Meanwhile, because Turkey is the fastest rising country for luxury cars, it seems advisable to target Turkey as a potential developing market (Porturkey, 2013). This report will attempt to evaluate the expansion of Aston Martin in Turkey with macro PESTLE analysis, followed by SWOT analysis, a market entry strategy and concluding recommendation for future marketing strategies based on the

Since firms facing an elastic demand can increase total revenue when they cut prices, the opposite condition exists when they try to raise prices. With many substitutes in consumption available, a price increase leads to a significant decline in consumption - the percentage change in quantity demanded exceeds the percentage change in price. Producers that raise prices when facing an elastic demand will find that total revenues decrease as the gain from charging higher prices is more than offset by a desertion of consumers to cheaper substitutes, with sales and output falling. When price

2) There are significant differences between the traditional Porsche customer and Cayenne and Panamera customers. The traditional Porsche customer is interested in exclusivity, in having a niche car, different than others. The Cayenne and Panamera customers are also interested in the utility of the car. In other words, they are interested in the storage capacity of the car and in the power of its engine. There are also financial differences between these types of customers. The traditional Porsche buyers have greater financial power in comparison with other buyers. This means that the Cayenne and Panamera customers' purchasing decision process is also based on the price of the car. Therefore,

BMW's strategy for value creation lies in its meticulous engineering, including design and styling. BMW designers pride themselves in delivering the unique styling that BMW is known for. They strive for designs that generate emotions – "Works of art". This is evident in the fact that many of the designers came from art or industrial design schools. The current design process involves two full size clay models – which are extremely costly and time consuming. However, the use of clay models provides a visual representation of the final product that many felt irreplaceable. By being able to physically see and touch a model of the final product the model can be handcrafted to make the slightest details apparent. Once the models are complete they are captured digitally by a laser scanner and brought into a Computer Aided Design (CAD) System.

The buyer decision process of a typical Porsche customer focuses on selecting cars that reflect their high social status, their financial power, and their preference for exclusive products. They are not interested in the utility or price of the cars in comparison with other customers that are interested in how much the car costs, its size, or its fuel economy performance. Porsche buyers also take into consideration the car's performance, but they focus on the sensations they have when driving such a car.

However, due to its unique targeting strategy, it has not win compatible brand recognition among the public. Although Audi enter much earlier than BMW and Benz in the luxury car market, its marketing strategy limited increase of public brand recognition even Audi has over 100 years’ history. Besides, although its styles are highly accepted by the targeting customers, there are a growing number of people who can afford luxury cars for family use in China. Lack of vitality is limit of its further market expansion. On the contrary, its major competitor in China, BMW, has launched a series of marketing strategies to promote its high-performance, manoeuvrability, as well as stylish design to attract young people (BMW, 2009) in order to expand its market share. Therefore, although Audi has achieved success in the targeting market, it may consider further development through diversification in product line and advertising campaign.