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Report on Geely

Autor:   •  February 21, 2019  •  2,068 Words (9 Pages)  •  174 Views

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- Legal environment analysis

Legal environment is one of the important factors that affect the marketing of enterprises. Code of conduct for business activities in the legal environment.

"Automobile finance company management measures" standard automobile consumption credit business management, will have a positive and profound influence on the cultivation and promotion of diversification, car financing main automobile consumption credit market specialization, and to promote the development of China's automobile industry and promote national the sustained and healthy economic development and other aspects will play a positive role.

5. Porter’s five forces Analysis

Porter's five forces analysis bringing together a number of different factors in a simple model, based on the analysis of a basic industry competition. The five forces model identified five main sources of competition, the suppliers and the bargaining power of buyers, the threat of potential entrants, the threat of substitutes, and finally, from companies in the same industry competition.

- Industry rivalry

China's auto market is an important strategic market for Volkswagen, GM, HYUNDAI and other multinational companies.

Geely's low-end market is the main competitors are BYD and Chery, in the high-end market, the main competitors are Shanghai GM, Shanghai Volkswagen, Beijing Hyundai, etc.. The competition between the existing enterprises is often expressed in terms of price, advertising, product introduction, after-sales service, and its competitive strength is related to many factors.

Geely as a Chinese independent brand in the automotive manufacturing, technology development and design have been recognized by the Chinese consumers, the implementation of China national policy in recent years, promote independent innovation, encourage and support the independent brand. Moreover, Geely in 2010 after the acquisition of Volvo, Geely also mastered its core technology, which is conducive to encourage better technological innovation as well as the development of international market.

- Threat of new entrants

The new auto industry entrants will inevitably lead to competition among enterprises, and ultimately lead to the decline in the profitability of the automotive industry. But in the automotive industry, the threat of new entrants is low. The reasons are as follows. The first is technology, a large number of car China projects are dominated by multinational companies, and the strength of the multinational experience and product development capability of its unique design, rich, for the lack of car industry background of new entrants has formed high barriers to entry. Second is the capital barrier, the auto industry is a very high capital intensive industries, the scale of the general project funds are more than 10 billion yuan, but also a great dependence on external financing. New entrants financing and financing more difficult. Third is the administrative limit. At present, Chinese automobile market saturation, vehicle emissions caused by air pollution to governance, the government for the implementation of the administrative China car strict entry restrictions, which forms almost insurmountable barriers to entry of new entrants.

- Threat of substitutes

Residents face expensive car purchase, insurance and maintenance costs, etc., to choose their alternatives. First, China vigorously develop the rail transport industry, subway, light rail to facilitate the establishment of the people's daily traffic needs. Second, China has high-speed rail as a strategic priority in the development of new industries, China's high-speed railway mileage has reached more than 1.8 kilometers, the rapid rail network to reach more than 40 thousand km. Third, the Chinese government to vigorously promote the development of low-carbon car, the private purchase of energy-saving and new energy vehicles to give subsidies. But now, with the development of economy and gradually mature consumer characteristic of transportation has its special purpose and function to meet the different needs of customers, so the car does not have completely replaced threat.

- Bargaining power of buyers

Nowadays, the major automobile multinational companies in the world have Chinese as key sales locations, there are diversiform kinds of vehicles, China market today, consumers are more rational, pay attention to economy of the automobile. With the improvement of the level of consumer demand, auto companies will gradually increase their demand for consumer demand. This is a customer service oriented industry. The main buyers through its lower prices and higher requirements of the quality of the product or service, to influence the existing enterprise in the industry profitability. This has increased the bargaining power of consumers.

- Bargaining power of suppliers

China's auto market to attract the world's auto parts industry giants have invested in china. Face the market is getting more and more pressure, auto parts manufacturers began to cut prices, and even cut, to reduce the expected goal, to ease the pressure.

In today's automotive industry, suppliers too much inventory can not be sold out, increasing the loss of suppliers. This necessarily reduces the bargaining power of suppliers. Geely has formed an industrial chain from auto parts to sales and service. To a large extent, once again lower the bargaining power of suppliers.

6. Management Recommendations

- In the business model, the implementation of differentiation strategy, make their own brand, their own characteristics. (such as car performance, quality assurance, customer service service), and use of various channels to do social propaganda effects (such as large public welfare activities, to the company for employees to send printed souvenirs Geely trademark etc.).

- Improve the management personnel and money management of the special positions, especially the senior management of the constraint mechanism, the other managers and money management of special positions, but also to develop the corresponding constraints and exchange mechanisms.

- Perfecting the system of supervision and management of business rules and regulations. The rules and regulations of the enterprise supervision system is divided into three levels, namely, administrative supervision


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