Porter Diamond Theory Case Study: German Car Industry

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.

Germany is Europe’s largest economy and is a significant member of the continent's economic, political, and defense organizations. Functioning with a mixed economy, Germany has one of the highest nominal and real Gross Domestic Products. Although the economy is doing well, Germany has also been continuously struggling with high levels of unemployment since 1989.

The Brand VW has always conveyed the message as an affordable car. The companies product have been looked upon as one which offered the benefits of German engineering affordably, emotionally. The cars represented completely different driving experience – more connected to the road – different way of driving – more connected to the world. Heritage of German engineering and the car's more fun, pleasurable driving experience were the powerful strengths. Affordability was one of the key factors as against most of the other German cars makers who represented only the high end of the Segment. It also focused on Drivability – Unique driving experience not just on the car's ability to get people from one point to other,

Germany has the largest national economy in Europe, the fourth largest by nominal Gross Domestic Product (GDP) in the world, and the fifth largest GDP per person based on purchasing power parity (PPP), and is a founding member of both the European Union and the Eurozone. Germany has a social market economy that combines capitalism with social policies favoring social insurance.

This report will look at the feasibility, the riskiness and the profitability of an expansion into the German car market. First, we will analyze the host country, Germany, with respect to its economics, political, legal and cultural aspect. Second, a SWOT analyses will be conducted to determine if Great Motor Wall is in a good

Germany is known to be one of the largest and most powerful economies in the world. It is located in Central and Western Europe, and stretches along the Baltic and North Seas. The country covers a total of 357,022 sq km, 348,672 sq km with land and 8,350 sq km with water. Germany shares borders with nine other countries, France, Switzerland, Belgium, Denmark, Poland, Czech Republic, Austria, Belgium, and The Netherlands. Germany is the seventh largest country in Europe, and the 62nd largest in the world (CIA World Factbook, 2016). The capital of Germany is Berlin, but it also surrounded by many other major cities (Leipzig, Munich, Stuttgart, Aachen, Nuremberg, Bonn, Heidelberg, and Cologne) to name a few.

Germany is the largest national economy in Europe, the fourth-largest by nominal GDP in the world, and fifth by GDP (PPP). The country is a founding member of the European Union and the Eurozone. The economic model of Germany is based on the concept of the social market economy.

As Volkswagen was responsible for employing almost half the population in Wolfsburg, it wielded a high degree of implicit influence. Because Volkswagen’s presence attracted other global, complementary and high activity area

Thirty-seven of the world’s 500 largest companies (based on stock) are headquartered in Germany. Many of those companies are car companies like Volkswagen and BMW. Other large names include Adidas and Puma. These companies are popular clothing and shoe brands found in the US. The retail store Aldi along with the computer software program, SAP, can also be found in Germany. Many of these businesses are headquartered near the largest cities in the country. Berlin is the largest city with over 3,275,000 people (Elledge). The second largest city is Hamburg with 1,686,100 with Munich following close behind with 1,185,400 people (Elledge). (Unless otherwise noted, all data in the above paragraph came from the article “Germany Industry Sectors”.)

Germany is a major economic and political force within Europe, and a founding member of the European Union (EU) since 1993. With a

Germany is an ideal logistics location for numerous reasons. The country size and prosperity make it a major customer in the goods market. Its central location in Europe enhances its role as a transport hub and the polycentric economic structure requires shipping services. The high level of industrialisation and trade openness generate additional goods flows. Furthermore, the high network density and high quality of the transport infrastructure are unique in Europe.

Not too long ago Germany was a country that was slow growing and had high unemployment rates. It was not the powerhouse that people often associate it with being today. As of today many things on the continent begin and end with Germany as it has become looked at as the big brother. Since Germany has become a powerhouse in Europe many have blamed them for the economic turmoil that different countries are going through “German export performance and the sustained pressure for moderate wage increases

German manufactures have always been strong in three areas: machine tools, chemicals and cars. Almost half of German exports, and 72% of its exports to China, are machinery or transport goods. When demands for exports collapsed, the German government came up with multiple schemes to stem unemployment,

The Federal Republic of Germany; with its capital city of Berlin, is located in Central Europe. With a population of 80,722,792 people; 65 to 70% of that practicing Christianity. The common language spoken in Germany is German, or Deutsch. With a total land mass of 137,846 square miles, Germany became one country again after the demolition of the Berlin Wall ending the Soviet Unions control over East Germany reuniting the country after nearly 30 years. Germany has prospered and once again become a nation to be recognized. ‘’Germany is also considered to have a moderate climate with no specific long periods of hot or cold weather’’. Although most of Europe uses the Euro, Germany has adopted the Deutschmark as its currency.

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.