The Smart Car - Case Study Essay

2586 Words Jun 27th, 2012 11 Pages
Christina L. Brown
MRKT 454
Case # 10-2 The Smart Car
June 16, 2012

Competitive advantage exists when there is a match between a firm’s distinctive competencies and the factors critical for success within its industry (Keegan & Green, 2011). There are two basic ways to achieve competitive advantage. First, a firm can pursue a low-cost strategy that enables it to offer products at lower prices than competitors. Next, an advantage can be gained by a strategy of differentiating products so that customers perceive unique benefits, often accompanied by a premium price (Keegan & Green, 2011).

In the case of the smart car, it seems as though the type of competitive advantage that Smart sought to attain was two-fold aiming
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Smart repaired this perception by creating a sophisticated electronic package that monitors wheel slippage [ (Keegan & Green, 2011) ]. Problems also arose as late night TV comedians were joking about the car’s appearance stating that it was “a motorized ski boot” and “a backpack on wheels” [ (Keegan & Green, 2011) ]. At the 2012 Geneva auto show, a company called Rinspeed who makes a business of servicing and restoring exotic cars, attempted to monopolize on these jokes by “creating a concept” that probably won’t make it to production, called The Rinspeed Dock & Go. It is a Smart Fortwo Electric Drive made more practical by adding a “backpack on wheels,” a two-wheeled trailer that connects or docks to the rear of the Fortwo [ (Quiroga, 2012) ]. Rinspeed imagines that this “dock” could be used to haul skis, carry camping equipment, or tote delivery items such as pizza [ (Quiroga, 2012) ]. Perhaps more practical is the proposed use of the dock as an extra battery to extend the Smart’s range [ (Quiroga, 2012) ]. Rinspeed also brings up the possibility of the dock housing a fuel cell, or perhaps an internal-combustion engine to extend the electric Smart’s range even more [ (Quiroga, 2012) ]. Overall, there are mixed reviews amongst the Smart owners and non owners. I have read that the car’s gas mileage leaves much room to be desired stating that with premium gasoline the car only gets 36 miles per gallon combined, 34 miles per gallon in the

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