General Motors Branding of Saturn

Executive Summary Branding is one of the most valid practices of marketing management in firms. Best practices in brand management result in the attainment of high volumes of sales by the company. This paper presents a case of branding and its impact on Saturn, which is one of the key brands of the General Motors Company.Advertising We will write a custom case study sample on General Motors: Branding of Saturn specifically for you for only $16.05 $11/page Learn More The paper is subdivided into three major parts. The first part of the paper is the background, which gives an overview of the case. The second part of the paper is the situational analysis, which explores the issue of brands and branding that are brought out in the case. The third part of the paper is the analysis of alternatives, in which suggestions to the issues of brand management identified in the case are given. Introduction Marketing is one of the most critical practices of firms amids t the competition that prevails in the market in which firms operate. Each company keeps coming up with marketing strategies as a way of improving the capacity of the firm to ease the competitive pressure that emanate from the practices of other firms in the market. Firms often develop a number of strategies, some of which favor the company while other marketing strategies result in complications and impact negatively on market sustenance (Ferrell Hartline, 2011). The General Motors Company is one of the world’s most renowned companies in the global automotive industry. This implies that the company has managed to produce brands that have ensured its competitiveness in the industry. It should be observed that the automotive industry is a technical industry, which makes it one of the most competitive industries in the world. For any firm in the industry to thrive in the market, it has to continuously embrace innovation and creativity. There are a number of other established c ompanies in the industry. These include Ford, Nissan and Toyota. This paper presents a case analysis of marketing practices in General Motors. The case presented in the paper focuses on Saturn, one of the brands of the General Motors Company. The paper begins by expounding the problem in the case, after which an analysis of marketing issues that comes out of the case is done. Background of the case General Motors has managed to sustain its operational competitiveness in the industry and the market at large through the production and positioning of different brands in the market. Therefore, this case centers on the marketing initiatives and practices that appertain to one of the General Motors Company brands in the market. The case revolves around the marketing decision by Saturn to produce and market other brands of cars. Since its establishment, Saturn has emerged to be a strong and independent brand, irrespective of the fact that the brand still lies under the umbrella of General Motors Company.Advertising Looking for case study on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More This was an aggressive development basing on the fact that General Motors had only relied on three brands in the 1990 decade. While this was seen as a step of bringing about a revolution in Saturn, a number of concerns were raised over the influence of this development of the company and its position in the market. The main concern came from the fact that the company had been dwelling on a narrow line of production, which captured a certain line of customers. The introduction of diverse brands implies the enlargement of the target market and the expansion of the market segments of Saturn, an exercise that may be quite daunting for Saturn and General Motors. The decision to develop diverse brands is welcome, but at the same time lots of doubts are raised about how the diverse numbers of products are to be managed in the mar ket. Saturn set out its operations back in the year 1990 with the rolling out of three brands of cars in the market. These three brands are: a sedan, a wagon and a coupe, thrived the market due to their features. Innovative and marketing management attracted an extended number of customers. These features attracted a new set of customers who could not have been captured by the General Motors Company. Five years into its operations, Saturn had attained a higher level of recognition in the market, making the company to be nominated for diverse awards basing on its score on satisfaction index. This performance implied that Saturn defied most of the odds of the industry, which is often deemed to be highly competitive and hard to penetrate. However, the sudden mushrooming of the company in the market began to be bound by the shrinking in sales, even with the introduction of a series of other new brands of cars in the market. The company also saw a number of newer brands like the L-series vanish from the market within a short time. The question that ought to be posed here is why the company was witnessing a reduction in the amount of sales, in spite of increasing the number of car brands in the market. Irrespective of the reduction in sales, General Motors has kept banking on Saturn to raise its performance. General Motors banks heavily on the capacity of Saturn, which lays in a number of things, among them the loyal base of Saturn customers. The central question in the case is the dynamic focus of Saturn and the implications that it has on raising the performance of the company in the market. With the adoption of diversity in production, several concerns are raised in the segment of the market, which will be central to the company.Advertising We will write a custom case study sample on General Motors: Branding of Saturn specifically for you for only $16.05 $11/page Learn More The effects of production diversification on the customers o f the company are also issues of concern. The impact of diversification of the company’s production leaves a lot of pending questions on the interactions between the company and its customers. The General Motors’ hope of market expansion through investment in Saturn lies in a number of things that have shown up in the brand. These are innovation, employee focus, social responsibility, and customer sustainability. Situational Analysis Overview of the environment The General Motors Company is ranked among the leading producers of cars in the world. However, the global automotive industry has volatile competition, which necessitates the application of competitive strategies by companies that are operating in the industry. One trend that is common in the competitive landscape in the global automotive industry is the innovative practice that results in the production of different car brands. However, attraction and sustenance of customers through the brands, remains to be a key challenge to a substantial number of firms operating in the industry, General Motors, being among the challenged companies. Companies in the industry have nonetheless kept inventing strategies that are geared at helping them access and gain significant control of customers in the market. Competition remains to be a fundamental guiding force in the industry that keeps steering the struggle for market and the subsequent sustenance of firms in the market. Branding is one of the key characteristic of marketing that is used by a substantial number of firms in the automotive industry (Wiedmann et al., 2011). The General Motors Company has been on the forefront in terms of developing brands as one of its competitive strategies in the market. One critical thing that has been observed in the case is that the General Motors Company has leveraged a substantial number of individual car brands in the market. However, the most critical thing that denotes the internal development of the compa ny is the development of the Saturn brand. Saturn produced is the first brand of cars in the year 1990. The brand accessed the market quickly, enabling the brand to quickly attain a respectable position in the market. According to George (2004), Saturn can be considered to be one of the key heritage brands of the General Motors Company. The three types of cars that were rolled into the market by Saturn in 1990 gained wide acceptance from a certain segment of customers in the market. This can be attributed to market research by Saturn, which enabled it to come up with brands that were appealing to customers. The pace at which a given product gains access and acceptance in the market is dependent on a number of factors. The most compelling factors are the ability of the products to meet the consumption demands of the customers.Advertising Looking for case study on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The consumption needs are based on prices, the level of utility of the product and the tastes and preferences of the customers. It can be said that the features of the three products that were rolled out by Saturn in 1990 met the needs of the customers. From the case, it has been noted that Saturn went further to produce another set of car brands later. These brands did not attain the level of sales that was attained by the first of their key brands that were unleashed earlier. The marketing mix Competing in the market through the nature of products is a complicated exercise as it involves a change in the nature of products in the market. One main thing that has been noted in the global automotive industry is that firms in the industry often compete through branding. As one of the main brands of the General Motors Company, Saturn has given a lot of attention to the development of diverse brands of products. While the first three brands gained a quicker access in the market, a series of other car brands that were produced as part of expanding the presence of the company in the market. A substantial number of market researchers have argued that the release of many brands in the market by firms can be an undoing factor for the company. At the same time, firms can use the deployment of several brands in the market as one of the tactics of dominating the market. While competing with products, one critical thing that a firm ought to observe is the entry point in the market. In the case under study, it was observed that that Saturn entered the market with a smaller range of products in the market, which made it gain fame in the market. The introduction of other brands by Saturn resulted in the complication of managing a wide range of products in the market. New products imply the expansion of the marketing segment of the company, which increases the task of managing a wider number of products in the market (Pride Ferrell, 2012). Pricing plays a vital role in shaping the performance of products in the market due to the changing conditions of the economy that affect the buying behavior of customers. The change in the number of products in the company that were introduced by Saturn in the market denotes a change in pricing. Pricing was one of the key attributes of marketing that attracted customers to the Saturn products. Saturn has not paid much attention to pricing, but rather to the broadening of the range of products in the market. The factors of production and the channels of procuring materials are part of the key considerations in the establishment of prices in an industry that is labor intensive (Biller et al., 2005). The market where a company operates in acts as a guiding factor in the establishment of marketing strategies. As noted in the earlier analysis conducted in the paper, Saturn produces brands that compete with numerous other car brands that are produced by other companies in the market like. The General Motors Company poses co mpetitive threat to other giant companies in the market like Toyota and Ford. Saturn targets a wider segment of the market, which is the reason why the company decided to expand its brands by venturing into the production of other brands apart from the first three brands. With the new car models, it can be said that the company wants to extend its brands to the young generation across the global market. However, the performance of the brands in the market raises questions about whether targeting the youths more can help to attain a desirable number of sales for the company as it is echoed out in the case. Spahi (2008) observed that the strategy of conquering the market through the enlargement of brands can result in the problem of managing customers. It denotes the expansion of the market, which could jeopardize the attractive aspect of the prevailing brands to the segment of customers already captured by the brands. Promotion is done through several means, one of which is the produ ction of brands with features that are appealing to a certain segment of customers. It should also be noted that the promotion of Saturn brands in the market is enhanced by the fact that the company has established itself as a brand in itself, an aspect that de-links it from the other long established brands of the General Motors Company like Chevrolet. The other promotional factor for the company in the market is the customer centric approaches that are held by the management of the company. This concurs with the argument that was advanced by Nadeem (2007), who noted that customer centric approaches are critical to the attainment of customer loyalty and, by extension promoting the brand in the market. Analysis of Alternatives While gaining customers is easily attainable, the sustenance of customers through brands is a whole complicated exercise because of the dynamics in brands and branding practices of firms in the market. The loyalty of customers is often attained through the bra nds that are released by firms in the market and the supportive mating management practices that accompany the brands (Kerr Balakrishnan, 2012). The problem in the case presented in this paper revolves around the issue of brand management in the market by Saturn. The question that ought to be asked is whether it was worthwhile for Saturn to introduce a series of other brands in the market, bearing in mind that the brands that already prevailed in the market had a remarkable performance. Arguing from the perspective of commanding the market through brands, it can be said that a substantial number of companies often opt for using the tactic of flooding the market with their brands as one way of controlling their competitiveness in the market. However, Saturn ought to introduce new brands on a one-by-one basis since it operates in a highly competitive market. This is a desirable exercise as it gives firms time to monitor and ensure that a given brand has attained the desired level of acceptance and commands loyalty from the customers. This is backed by the finding of a research that was conducted by Bowman and Gatignon (1996), who sought to know the impact of the multiple brand introductions to the management of product mix. Brown and Gatignon concluded that it is quite daunting to manage multiple brands in the market, especially when they are introduced at the same time by the company in the market. From their observation, they argued that firms need to prioritize the entry of brands in the market as this helps to ease the pressure of managing brands in the market. A reasonable gap needs to be given in order to ensure that customers gain familiarity with a give brand before another brand is presented to them by the company (Bowman Gatignon, 1996). The other key alternative of marketing management in this case entails the utilization of other aspects of marketing management as a way of catching and managing the attention of customers on the brands released by S aturn in the market. It should be noted that the marketing function in firms is comprised of diverse practices, all of which help the company to gain and sustain customers. Brand positioning is often attained not by the nature of the brand itself, but through the nature of marketing practices that are deployed by the company in its quest to familiarize the brand in the market. As observed in the case, the earlier key brands of Saturn were able to gain a wider acceptance from the customers through the practices that were deployed in releasing them to the customers. This reiterates the need to embrace diversity in marketing practices if at all the General Motors Company wants to boost its presence in the market through Saturn. Such practices are elusive and begin with the exercise of motivating the marketing team of the company. They denote the deployment of aggressive marketing tactics that aim at ensuring that a substantial number of brands have gained the desired level of attention in the market. Promotion of each individual brand in the market through pricing and other marketing offers is essential for differentiating the brands in the market (Morris Martin, 2000). Saturn needs to be creative so that it does not deploy similar tactics in promoting the different bands in the market. Conclusion and recommendations Brand management is a critical yet a complex exercise. From the case, it has been noted that managing multiple brands in the market is quite daunting and can result in market loss by a given company. Saturn had a good command of the market when it introduced a few brands in the market. However, its sales declined amidst its decision to introduce a series of other brands in the market. Several arguments arose, among them the issue of differentiating brands in the market segments. As noted in the analysis of alternatives, Saturn needs to pay attention to two critical issues in order to avert the problems of branding that are facing it. First of all, S aturn should recognize the need to manage the pace at which it introduces brands in the market. The most desirable way to do is by marketing each brand at its own time. This is critical in differentiating the brands in the market. The company can also focus each brand on a given market segment. This is one way of avoiding the generation of conflict of interest among the customers already attained by the preceding brands. The second critical point that should be considered by Saturn is the deployment of different strategies of marketing management for each of the new brands that are released by the company in the market. This can greatly aid in maintaining the difference between the brands and sustenance of the brands in diverse market segments. References Biller, S., Chan, L. M. A., Simchi-Levi, D., Swann, J. (2005). Pricing and the direct-to-customer model in the automotive industry. Electronic Commerce Research, 5(2), 309-334. Bowman, D., Gatignon, H. (1996). Order of entry as a moderator of the effect of the marketing mix on market share. Marketing Science (1986-1998), 15(3), 222-222. Ferrell, O. C., Hartline, M. D. (2011). Marketing strategy. New South Wales: South-Western Cengage Learning. George, M. (2004). Heritage branding helps in global markets. Marketing News, 4(13), 1. Kerr, G., Balakrishnan, M. S. (2012). Challenges in managing place brands: The case of Sydney. Place Branding and Public Diplomacy, 8(1), 6-16. Morris, R. J., Martin, C. L. (2000). Beanie babies: A case study in the engineering of a high-involvement/relationship-prone brand. The Journal of Product and Brand Management, 9(2), 78-98. Nadeem, M. M. (2007). Emergence of customer-centric branding: From boardroom leadership to self-broadcasting. Journal of American Academy of Business, 12(1), 44-49. Pride, W. M., Ferrell, O. C. (2012). Marketing. Mason, OH: South-Western Cengage Learning. Spahi, S. S. (2008). Optimizing the level of customization for products in mass customization sy stems. University of Central Florida. ProQuest Dissertations and Thesis, 219. Web. Wiedmann, K., Hennigs, N., Schmidt, S., Wuestefeld, T. (2011). Drivers and outcomes of brand heritage: Consumers’ perception of heritage brands in the automotive industry. Journal of Marketing Theory and Practice, 19(2), 205-220. This case study on General Motors: Branding of Saturn was written and submitted by user Jabari Nieves to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

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Recognizing and acknowledging improvements - Principle 7: Factual approach to decision making Effective decisions are based on the analysis of data and information Key benefits: Informed decisions. An increased ability to demonstrate the effectiveness of past decisions through reference to factual records. Increased ability to review, challenge and change opinions and decisions. Applying the principle of factual approach to decision making typically leads to: Ensuring that data and information are sufficiently accurate and reliable. Making data accessible to those who need it. Analysing data and information using valid methods. Making decisions and taking action based on factual analysis, balanced with experience and intuition. Principle 8: Mutually beneficial supplier relationships An organization and its suppliers are interdependent and a mutually beneficial relationship enhances the ability of both to create value Key benefits: Increased ability to create value for both parties. Flexibility and speed of joint responses to changing market or customer needs and expectations. Optimization of costs and resources. Applying the principles of mutually beneficial supplier relationships typically leads to: Establishing relationships that balance short-term gains with long-term considerations. Pooling of expertise and resources with partners. Identifying and selecting key suppliers. Clear and open communication. Sharing information and future plans. Establishing joint development and improvement activities. Inspiring, encouraging and recognizing improvements and achievements by suppliers. - ISO 9000 is a family of standards for quality management systems. ISO 9000 is maintained by ISO, the International Organization for Standardization and is administered by accreditation and certification bodies. The rules are updated, as the requirements motivate changes over time. Some of the requirements in ISO 9001:2008 (which is one of the standards in the ISO 9000 family) include a set of procedures that cover all key processes in the business; monitoring processes to ensure they are effective; keeping adequate records; checking output for defects, with appropriate and corrective action where necessary; regularly reviewing individual processes and the quality system itself for effectiveness; and facilitating continual improvement A company or organization that has been independently audited and certified to be in conformance with ISO 9001 may publicly state that it is ISO 9001 certified or ISO 9001 registered. Certification to an ISO 9001 standard does not guarantee any quality of end products and services; rather, it certifies that formalized business processes are being applied. Although the standards originated in manufacturing, they are now employed across several types of organizations. A product, in ISO vocabulary, can mean a physical object, services, or software. Contents [hide] 1 Contents of ISO 9001 1.1 Summary of ISO 9001:2008 1.2 1.0 Scope 1.3 2.0 Normative reference 1.4 3.0 Terms and definitions 1.5 4.0 Quality management system 1.6 5.0 Management responsibility 1.6.1 5.1 Management commitment 1.7 6.0 Resource management 1.8 7.0 Product realization 1.9 8.0 Measurement, analysis and improvement 1.9.1 8.5 Improvement 1.9.1.1 8.5.1 Continual improvement 1.10 1987 version 1.11 1994 version 1.12 2000 version 1.13 Certification 2 Auditing 3 Industry-specific interpretations 4 Effectiveness 4.1 Advantages 4.2 Problems 4.3 Summary 5 See also

Case Analysis: Ford Corporation

Case Analysis: Ford Motor Company Global Strategic Management March 4, 2013 Ford Motor Company: Organization Profile Ford Motor Company Staying â€Å"Ford Tough† Henry Ford established the auto company in June 16, 1903. An engineer by formation, Henry had a vision of making vehicles that would change society. He wanted to offer an affordable product to the public, one that his own workers could buy. His vision took him to model T in 1908, and to improve the manufacturing process with the conveyor belt at Ford’s Highland plant.The manufacturing capabilities kept on improving and in 1917 he built the Rouge plant that put the whole operation, from the raw material, to the final product, under the same roof. In 1915 Henry Ford’s son, Edsel Ford joined his father in the company. Edsel brought to the company the desire of making a product not only functional, but stylish and beautiful. Ford became entirely family owned in 1919 when Henry, his wife Clara, and Edsel boug ht the outstanding shares for $105,820,894 (Chapman, pp. 128) . The company would hold to this status until 1956 when the company would allow outsiders to buy shares.For many years the image of the company was the same as its leadership. Henry Ford passed the presidency to Edsel Ford in 1919. Henry Ford reassumed the leadership after the death of Edsel in 1943. After Henry Ford resigned, Henry Ford II assumed the presidency. The company inherited by Henry Ford II was not the same. Ford had fallen behind General Motor (GM) and Chrysler. Henry Ford II knew he had to regain terrain, so he contracted the Whiz Kids (a group of former US Army Air Force officers), and created a â€Å"sophisticated management system including accounting and financial controls† (Chapman, pp. 28). With the finance side in check, Ford gained increased its position, and became the number 2 car company in 1950. Ford products were not fuel efficient, and when the gas prices rose in the 70s because of the O PEC embargo, Ford lost many consumers. The company responded by closing plants and cutting jobs. After the storm, the sun came out in the late 80s with the launch of Ford Taurus and Mercury Ford was on the top of the game once again. The desire to diversify made Ford buy other brands and include it in its family such as: Jaguar, Aston Martin, Land Rover and Volvo.Bill Ford assumed the presidency of the company in 2001. It was the first time in 20 years that the head of the company was a member of the Ford family. Bill Ford drove the company through one of the worst times in history for the company: right after the extensive (and expensive) Firestone tires recall, and the terrorist attacks of September 11, 2001. Bill Ford went to ups and downs during his presidency. He saw sales improving slowly from 2001 to 2006, but the increasing competition from foreign brands such as Toyota, Nissan and Honda made him realize that he needed help taking the company to the next level.Alan Mulally b ecame the new CEO in 2006. He was a new face in the auto industry, coming from Boeing Corporation instead from inside Ford or from another auto company. Mulally â€Å"demonstrated leadership skills Henry Ford had established many years ago. † Mulally brought to the company new energy, and a brave new plan. His most risky decision proved to pay off in the end. He decided to raise money by mortgaging almost all of Ford’s assets including the brand. His audacity put Ford as the most trustworthy American company. The money raised by Mulally helped keep Ford out of the government bailout of 2009.Ford Motor Company: The Problem(s) Ford has been a pioneer in the auto industry but it still faces a lot of problems to make it the number one in the industry. The increasing competition from other car companies to creatively and efficiently attract and retain customers made it difficult to gain the number one position. The economic crisis also made it hard to sell new vehicles. The quality of Ford vehicles have also gone down compared to what it was before. The slow reaction to change in consumer taste made Ford lag behind its main competitors.It was also late in expanding in international market and opportunities were lost to other brands. Ford Motor Company: SWOT Analysis Strengths One of Ford’s biggest strengths is its leadership. Since Henry Ford founded the company, the leadership has been proven to help the company throughout difficult times. Every leader brought to the company a new idea. Henry Ford wanted the company to produce an affordable product. His successor, Edsel showed that innovation is always necessary in this industry. Edsel wanted stylish and beautiful vehicles to carry the Ford brand. Henry Ford II with he help of the Whiz Kids developed a â€Å"sophisticated management system† what helped the company after World War II. He also â€Å"revitalized Ford with modern engineering, manufacturing, assembly, and distribution facil ities in the US and 22 foreign countries† (Chapman, pp. 128). The strong and visionary leadership style of Henry Ford was shared by many other leaders of Ford. The new generation, Bill Ford and Alan Mulally also presented the traits of a Ford leader. Bill by navigating Ford throughout harsh times, and for seeing that the company needed a change, a fresh start.He then passed the leadership of the company to Alan Mulally who proved to be exactly what the company needed. Mulally discovered that Ford lacked â€Å"global synergy,† he was surprised by the way that Ford was operating its brands. He saw that the company did not have central control, it took him a while to find out what was really happening inside the company. He also made really tough financial decisions, and reorganized the amount of brands and models offered by Ford. â€Å"With his leadership and conviction, Ford Motor Company stood apart from its competitors by standing on its two feet† (Chapman, pp. 33). Ford’s reputation is also an incredible strength for the company. Ford is seen as a family company. Henry Ford wants the employees to be able to buy cars, increased their wages, and was interested in sharing a piece of his family with others. Weaknesses Ford has proven to be slow to respond to changes in the environment and consumer tastes. They felt that they â€Å"got it,† and felt comfortable with it. Since the beginning of Ford, with a delay to offer cars in other colors than black, they experience a tardiness to respond to changes.One example was the excessive attention to SUVs and other gas inefficient cars when the gas prices spiked. When consumers were looking for alternatives to the gas drinking vehicles, Ford was fully producing SUV’s. Although SUV’s are Ford bestselling product, the fact that they were slow to make them more efficient or give costumers other styles to choose from, made Ford to lose market share to other automakers. Ford al so lost terrain when they did not address earlier the ecofriendly trend. Toyota had the Prius which did not have much of a competition until recently.Currently, Ford has â€Å"12 vehicles with best in class fuel economy and 4 models with at least 40 mpg† (Chapman, pp. 137), and is developing plug-in models that use a combination of electricity and gasoline that will compete against the Chevrolet Volt. Opportunities Ford has the opportunity to expand its presence and capture market share in India and China. It aims to increase its revenues from international sales from 20 percent to 50 percent. The expanding market of the two countries allows Ford to focus on small, light and fuel efficient cars that are needed in the market.Ford has also been slow to respond to demands for small hybrid or fuel efficient cars in the United States. There is also an opportunity to increase standardization of the platforms used in world-wide production of vehicles. If this happens the cost of pro duction would significantly lower and it would be easier to introduce new cars into new markets without building new plants. Ford can also further trim down the number of models out in the market and focus on cars they are widely known for such as light trucks and expand its model for smaller and fuel efficient cars.To target the higher end market, it should continue to build its Lincoln brand as a better alternative in the US and once established, export that brand to new markets overseas. Production from union controlled plants could also be transferred to non-union plants that can give Ford plants a competitive edge or be at par with other auto companies in compensation for workers. Ford can also consolidate more dealership to become more competitive and give them incentives to attract more customers thru financing and offering excellent customer service. ThreatsThe auto industry is very competitive and technology driven industry. Ford has to constantly monitor its competitors to know how it will make its own decision. Companies will outbid one another in attracting new customers by giving them a lot of rebates, incentives and attractive financing. The technology for clean, fuel-efficient cars and alternate sources of fuel is also changing and without proper funding for research Ford could be left behind and lose in this expanding market. Any increase in price of raw materials could also increase production cost for Ford and make their vehicles more expensive.Demands of union workers also affect the competitiveness of Ford. They are currently paying higher compensation and benefits compared to the rest of auto industry. Changing consumer tastes also makes it difficult for Ford to quickly address and create cars that the market needs. Any decline in the US economy would also greatly affect the revenues of Ford. Most of the revenues of Ford comes from the US market and if the US economy goes into another recession it would decrease consumer spending and make it difficult to survive without government help. Ford Motor Company: Five Forces Threats of Substitute Products – High in Urban Areas, Low in Suburban Areas * With the increase of gas prices and traffic congestion consumers are now looking for alternate ways to commute between work and home. Consumers are increasingly being aware of their â€Å"carbon footprint† and are looking for clean and energy efficient alternatives to commute. In cities, the availability of public transportation such as buses, subways and light rail systems gives commuters flexibility. Car-sharing options such as Zipcar are now also available in cities and have become popular. Rivalry Among Competing Firms – High * Competition in the auto industry is very high. Different companies compete aggressively in increasing their market share by giving incentives to customers. It is also important for companies to satisfy the needs and tastes of consumers. Companies also try to run an efficient sup ply chain to limit the cost of producing and increasing profit margins. * Threats of New Entrants – Low * The threat of new entrants in the local auto industry is low. The auto industry is very capital and labor intensive and it takes time for companies to establish their operations.The current companies have established their presence and market share but competition from potential, new and growing car companies in big markets such as China and India is inevitable. * Bargaining Power of Suppliers – Low * The auto industry sources its raw materials from global suppliers. The suppliers market is also a competitive industry. Bulk of their sales come from the auto industry and companies have established relationships to give them access to supplies and new technologies. The relationship of auto ompanies and suppliers are intertwined given that as auto companies increase production, supplier companies increase revenues. * Bargaining Power of Buyers – High * Consumer s now have more choices that gives them a higher bargaining power. The economy is also improving and giving them more buying power. Unlike before where manufacturers dictate what the dealers will push to the consumers, consumers now make the demand for manufacturers to make fuel-efficient and environment friendly cars. Consumers are also well informed and by being well informed they can ask for more incentives to dealers and car manufacturers.Ford Motor Company: Recommendations Under the leadership of Mulally Ford has significantly made changes to improve the position of the company. We recommend that Ford increase funding on research for fuel efficient cars, alternate sources of energy for smaller cars that the market demands and will create sustainability in its vehicles. Ford should also maintain or increase the quality of its vehicles by standardizing its platforms and improving its technology to detect any safety issues with its vehicles to avoid costly recalls that not only is expensive but tarnishes the image of the company.The economic crisis has made it difficult for other car companies not to be bailed out but Ford was able to maintain its independence by using its assets and enforcing better control in its finances. Ford can continue to be competitive by maintaining or lowering its operating costs. Ford has been known in its proficiency in having a tight supply chain were it can control the costs of production. Ford should be quick to adapt in changing consumer tastes.It should not be content with making products that they are known for and lose market share in new vehicles that are small, clean and fuel efficient. It should also make its current models cleaner and more fuel efficient to maintain attractiveness to consumers. Ford has great potential in new markets such as China and India. The reputation it has built as a well know car manufacturer in the US can be used to tap new customers in international market. Ford has built by its strong leader s and will continue to thrive if more reforms are made.