Volvo Trucks (A): Penetrating the U.S. Market
Executive Summary
The strategic problem is that Volvo is not creating superior value (Appendix 1) for its customers in the US market by utilizing its existence from early 70’s and thus has the poor market share of 11% relative to the top 3 competitors within the industry. The strategic opportunity is to increase the market share from 11.6% to 20% by 2001 by creating a product differentiation advantage. Through the acquisition of a technologically advanced company, Volvo will be able to gain competitive advantage in the industry. Volvo has not been able to grow their market share above 12% since they entered the US market in 1975 and thus they find themselves ‘stuck in the middle--which
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Fleet buyers and leasing companies buy the heavy trucks in mass amounts, which are driven by truck drivers who are the centers of influence in the heavy truck industry. By providing them comfort through a sleeping cabin, heavy trucks with this feature will change the mindset of drivers toward Volvo heavy truck segment. The implication for Volvo is an increase in brand awareness in the industry, created through positive word of mouth from drivers and in the long run, further create an increase in the market share.
Case Questions
Volvo entered the US heavy truck market in 1975 and missed the opportunity to acquire Freightliner (Appendix 3), which was acquired by Daimler-Benz and later became the market leader. Due to the difference in the European and US industry regulations, Volvo was not successful in implementing the same strategy as they did in Europe. This further made it more difficult to standardize their product within the heavy truck segment and benefit from economies of scale or scope, thus implying that the globalization of the heavy truck industry is very difficult.
In 1988 Volvo was unable to meet the high demand of heavy trucks, which led them to acquire GM Heavy Truck. Unfortunately, Volvo did not use this acquisition to their advantage, and failed to integrate this acquisition into a higher profit margin. In order to effectively cater to their customers (fleet operators and leasing companies), Volvo used this opportunity to provide
A Judge will grant specific performance in a land or real estate deal as stated in Raynor,”the purchasers were entitled of the relief granted by the final decree to specific performance upon payment of the purchase price less the amounts already paid as a deposit, as well as interest thereon.”
Even though the Ford Motor Company is currently doing extremely well in the automotive industry, they are currently emerging opportunities to be a leader in electrification, autonomy, and mobility. The Ford Motor Company recently purchased SAIPS and Chariot. “SAIPS is a world-class provider of customized algorithmic solutions in the fields of computer vision and machine learning” (Crunchbase, na, nd). Chariot is a company that offers shuttle service and commuter mobility programs in larger cities. The purchase of these two companies will help the Ford Motor Company as they expand as a mobility company as well as the leader in the automotive industry. According to the article, Ford Outlines Growth Plan, “Ford is evolving its business in three ways:
General Motors, the “mother company” has faced many troubles in the past, and surfaced. A research by the National Research Council in the United States has revealed in 1992 that there had many impacts and future impacts in the automotive industry, indeed; it would affect the jobs and the internal economy. However, General Motors understood the threat potential that this and established strategic plans to revert the trend. Furthermore, whether General Motor Company was able to change the trend, and it saw the internal and external factors, prepared a strategic plan, Holden being the first brand in Australia, with at least just the 10 % of the population compared with the USA, the way to get a plan looks easier. In addition, it is easier to see a trend in countries with low population and good policymakers. In 2008 General Motors faced again the limit to bankruptcy. A fierce plan to develop and a new business association with FIAT made that GM avoid the dissolution. Even do all Europe have had a similar crisis( Boudette & Choudhury,
Even though GM has been given some advantages, it is experiencing problems in Europe and in South America (Kinicki & Williams, 2013). The home market is proving to be a challenge, also. Toyota and Honda are standing out as stiff competition. One plan to help achieve the profit goal for GM is to reduce auto platforms by
The automotive industry designs, develops, manufactures, markets and sells motor vehicles, and is one of the world’s most important economic divisions by profits. This analysis focuses on the industry, specifically, manufacturers of automobiles. There are five competitors in the StratSim environment: Firm A, B, C, D, and E. Industry sales in the most recent year were 4.3 million units, with expected growth in the next year. Within this industry, there are seven-vehicle classes: Economy, Family, Luxury, Sports, Minivan, Truck, and Utility. There are two new classes with potential – if properly marketed.
· The Chevrolet (also owned by General Motors) is a product which will bring a lot of opportunities in terms of sales in the future which can help the profitability of Holden/General Motors
After several failed attempt of internal diversification, they realized the lack of knowledge of their management about businesses outside the automotive area. so acquisition brought them quick fix where it brought already knowledgeable people in respective areas in their payroll.
General Motors has always had a reputation of diluted products. They had many vehicle lines with many differend brands. This idea was to offer a product that appealed to many different target markets. They have since simplified their product lines by selling off certain brands. Oldsmobile, Saturn, Saab, Hummer, and Pontiac have been disbanded and the new General Motors is a tighter more organized business as a result. Cadillac and Buick have seen steady growth within their sector and have been marketed very well to date. Cadillac is seen as prestigue symbol and has a larger pricetag than any of the other models. Buick is showing phenominal growth with an introduction of new products that is taking the focus of
Over the years, the U. S. auto industry's market has been experiencing fluctuations due to many reasons including: price, quality and foreign competition. General Motors Corporation (GM) which had been the leading car and truck manufacturer had been experiencing declining market share and facing stiff competition from both U.S manufacturers and foreign imports such as the Asian auto producers that included Toyota, Honda and Nissan. The main reason for increased foreign competition was that foreign cars were more fuel efficient, smaller, less expensive, and often more reliable than their American counterparts.
Chapter 7: Merger and Acquisition Strategy --- The Acquisition and Restructuring of Kia Motors by Hyundai Motors (written by Seungwha Chung and Sunju Park)
Ford Motor Company preserves its place as one of the largest makers of vehicles globally by making changes to its strategies. Ford needs to create a plan of action and ideas that react to the most substantial effects from outside divisors in the motor vehicle industry globally. The Five Forces analysis of Ford Motor Company recognizes the most significant outside elements and how they affect the company, rendering data that helps in management’s decision-making process.
For the story the Great Wall of China is a series fortifications in northern China that was built to protect the northern borders of the Chinese Empire against the intrusion of various nomadic groups. The company has about 30 subsidiaries and 38,000 employees working for them. Taking a look at the products Great Wall Motors has to offer, it includes three categories of “Haval SUV”, “Voleex Sedan” and “Wingle Pickup”. Great Wall Motor has been winning a few awards. It has been listed in the “Forbes Top 100 Chinese Enterprises” twice, had gain honours of "China 's 500 Most Valuable Brands", "Most Valuable Listed Automobile Company" and "No. 1 of Top 10 Listed Chinese Automobile Companies".
5) Another example of creating value by using a related diversification strategy was when Haier applied innovation to product design and production from the Liebherr Corporation of Germany. This strategic move created value by not only competing and expanding its product categories, but also by creating market needs. (pg. 7) The activity sharing and market need helped create product breakthroughs like washing machines that operated without detergent or water, and refrigerators that needed no compressors. (pg. 8) Another example of creating value was when Haier entered a strategic business alliance with Sanyo. Sanyo wanted to increase its competiveness in China taking advantage of Haier’s extensive distribution network, whereas Haier hoped to enter the Jampanese market by utilizing Sanyo’s distribution and service centres’s. (pg. 12) In the end Zhang Ruimin utilized this diversification strategy in an attempt to gain market power. B.Also discuss how Haier can use unrelated diversification strategy to create value.
The third main issue we considered was the one related to Specialized Competitors. For this issue we will just briefly explain what each strategy's focus is, since the reason for not implementing them is practically that they are too related to the main issue we consider needs to be considered by BMW. As our first option to overcome this issue we suggested to "Have specialized BMW dealers", which means to have only dealers who sell BMW cars and have more knowledge of the brand and products they are selling. The second option we recommended was to "Reduce the number of dealers" since there are lots of dealers who are not even selling one hundred cars per year, something that does not help at all to the sales goal. The last strategy we were recommending was to "Increase sales share of current dealers". This strategy just wasn't fine since it would affect BMW's costs and lower their profit.
GM enters into the Russian market immediately after the Ford entered. But it has decided to go with Joint