In fact, Thailand and Malaysia have the credit of having the largest automobile sector which is also highly sophisticated. Both these countries competed in different ways in order to win the race of competition. They used individual set of strategies for the import substitution which is a part of the industrial development and also differed in their multinational strategies to a great extent.
The automobile industry is considered to be one which conquers the entire industry. It has got a lot of components that contribute in the development of the nation along with technological advancements. A specific set of sequence needs to be followed in order to create a national level auto industry, especially in developing nations. This sequence is actually prescribed by the national auto industrial development.
The first step of the formation of a national automobile industry would be to import completely built-up (CBU) vehicles by the distributors who are available locally. Then comes the assembling of semi/completely knock-down (CKD) vehicles by subsidiaries and licensed companies. The third step would be the assembling of CKD vehicles and the last and the final step of the sequence would be the full-scale manufacturing of the automobiles. The manufacturing would initially be limited to the domestic market and would be later spread by way of exports to other markets.
PESTLE analysis is a useful tool for understanding the "big picture" of the environment, in which you are operating, and the opportunities and threats that lie within it. By understanding the environment in which you operate (external to your company or department), you can take advantage of the opportunities and minimize the threats. (RAPIDBI)
Political Environment: Political forces influence the legislations and government rules and regulations under which the firm operates.
Economic Environment: Economic factors clearly indicate the nature and direction of the economy in which a firm operates. Progress is the key value and driver of Ford Motors.
Social Environment: The social environment is an important factor as changes in the values, beliefs, attitudes, opinions and lifestyles in society create potential opportunities for an organization. The values of ford Motors is to always design an approach which helps in improving the quality of customers' lives and also to create an eco-friendly approach towards work.
Technological Environment: Technological environment means the trends and developments in the technological field that might: improve production, create new product opportunities, and render the existing ones (Google). Technologically, Foed motors has always been leading the race in the automotive industry.
Legal Environment: Legal factors also have to be considered by any firms before stepping into another country.
Porter's five forces model - Description:
The effective formulation of a strategy needs a clear understanding of competition. Competition in an industry is determined not only by existing competitors but also by other market forces such as customers, suppliers, potential entrants, and the existence of substitute products. . Michael E. Porter of the Harvard Business School has developed a framework known as the 'Five forces Model' to help analyze the business environment.
Threat of New Entrants - The threat of new entrants rises as the barrier to entry is reduced in a