Case Study: Volkswagen Motor (Case Study Sample)
It was a case study where the task was to formulate SWOT analysis of Volkswagonsource..
"Volkswagen" was founded in 1937 by the German Labour Front. Its headquarters are situated in Wolfsburg. It became the largest automaker company in 2016 and 2017 in terms of highest sales worldwide. According to size of market, it occupies largest share in China with over 40% sales in the region as well as similar profits.
It sold over 4.5 million cars in 2018 in China alone. The word "Volkswagen" refers to "people's car" in the German language. The company manufactured over 8 million cars on an annual basis and has a 1-2 share place as compared to Toyota Motors worldwide.
The German automaker comprises of widest product and brand portfolio among all leading auto manufacturers of the world. The industries served by VW include the Automotive, financial and Maritime. The main product of VW is motorcycles, trucks, buses, and cars for the automotive industry (Beske,2008).
It produces machinery and engines for the maritime industry. It serves globally in almost 120 countries. It recorded a historic revenue of over €280 billion in 2018 and €240 billion in 2017. Similarly, profit was above 200 billion euros in the same years.
Its total employees are nearly 700000, as recorded in 2018. Main competitors include Chrysler Group LLC, Bayerische Motoren Werke AG, Ford Motor Co, Daimler AG, Honda Motor Company, Tata Motors, General Motors Company, and Toyota Motor Corporation.
The main product line includes Sedans, SUVs, Compacts, and Wagons. There are various subcategories in the main product line as well. Similarly, customers can build their own customized vehicles as per demand with custom-tailored interior and the exteriors. This type of customization is rarely offered by other competitors.
SWOT stands for analyzing the strengths, weaknesses, threats, and opportunities for a company(Hill,1997). It is basically an internal and external environment analysis conducted by companies to stay competitive and plan accordingly to meet challenges.
Let us do a SWOT analysis of Volkswagen motors:-
1-Diversification at VW
The revenue of Volkswagen is high due to various products, brands, and geographic distribution than its competitors. The diversified brand and product portfolio helps the company target various customer segments and satisfy their changing needs. The variety of serving many industries like financial, automotive, and maritime is also a positive thing for Volkswagen. Almost 75% of its income comes from a segment of "passenger cars." The remaining share comes from revenue of financial services, power engineering and commercial vehicles(Karabakal,2000).
2- Wide brand portfolio
VW has widest portfolio of brands in the automotive industry. It has products in 12 different brand categories. It sells cars under the name of Seat, Audi, Bentley, Skoda, Volkswagen, Lamborghini, Porsche and Bugatti brands. One of its motorcycle brands is Ducati. None of its competitors come close to it in terms of so many brands. Toyota sells only fewer than four brands. GM motors possesses only 10 brands.
3- "Together -2025" novel strategy
In the light of external pressures of market and their own emission scandal, VW introduced a new plan to focus delivering till 2025. Key goals of company are to launch 30 electric cars till 2025. This is part of their electrification campaign. It also plans to enhance autonomous driving, digitization and battery technology in cars. There is a proposal to enhance the R & D budget at least 2 billion euros.
1-Negative media portrayal and publicity
VW encountered a plethora of negative publicity after its "Dieselgate" scandal in 2015. The company had initially agreed to install a unique software code system in its diesel vehicles that would help in controlling various emissions during car testing in the lab as compared to real testing. The investigation was done, and the firm was declared guilty in various countries. The fines for the scandal were almost 16.3 billion euros. Due to this and future concerns, the company had to recall millions of vehicles and faced harsh criticism(Koplin,2007).
2-Huge recall from the US market
Mass production levels of vehicles in the US recorded the highest recall rate as compared to other automakers in the industry. By an estimate, it recalled all of its vehicles twice. This high recall is linked with huge additional costs, negative publicity, and dissatisfied customers.
1-Acquiring new skills and capabilities
To fulfill and realize its future goals, the automaker giant has to enhance competencies in autonomous driving, digitization, and batter
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