PORTER'S FIVE-FORCES MODEL

Porter's Five-Forces Model in the Car Industry

Porter's Five-Forces Model in the Car Industry

Introduction

United Kingdom's continuous rapid growth of auto market and the total size of the continuous expansion of United Kingdom's auto market to significantly enhance the international status of United Kingdom's auto market has become an integral and important world car market part. Car sales in United Kingdom accounted for the proportion of the world's total vehicle sales has been from 2001 to 4.3% to 8.1% in 2004, the year 2005, total demand reached 5.75 million vehicles around, United Kingdom has become the world's second compared with Japan largest car consumer market, further raised to 8.7%. Incremental global annual vehicle sales in United Kingdom accounted for 25%; United Kingdom has become a global car market to promote the growth of the main force. (Blois, 2004, pp. 207-227)

Five Forces Model Michael Porter (Michael Porter) made in the early 80s, to cause a global business strategy far-reaching implications. It is used for the analysis of competitive strategy, can effectively analyze customer's competitive environment. Five forces analysis, external analysis of the micro-environmental analysis, mainly used to analyze the competitive landscape of the industry, business and other sectors of the industry and the relationship between. According to Porter (M. E. Porter) point of view, the competition in an industry, not just competitors for the original, but there are five basic competitive forces: potential new entrants to the industry, the competitive alternatives buyer bargaining power, bargaining power of suppliers and industry competitors are now competitive. These five basic competitive forces, and integrated intensity of the situation, determine the degree of intense competition in the industry, which determines the ultimate profit potential in trade and capital flows to the industry level, all ultimately determines the ability of enterprises to maintain high yield. First proposed a viable strategy should include recognition and evaluation of these five forces, the characteristics and importance of different forces due to the different industries and companies change, Porter's competitiveness model significance is the resistance of the five competitive forces contains three types of successful strategic thinking, which is well-known: overall cost leadership, differentiation strategy, specific strategy. (Arthur, 1994, pp. 150)

Before going to analysis the five forces model for UK car industry it is important to Defined borders, recognition of trade restrictions, because different countries have different determinants of external boundaries of environmental factors, such as the "capital market " strategy of the domestic capital market restrictions affect the company. Some countries have a long-term capital market outlook, while others are short-term prospects. How long in the long term of different industries. Short-term prospects of the country will be more inclined to compete in the investment industry in the short term. Long-term prospects of the country will tend to be more competitive in the industry, their investment is long term. Government policy also affected, such as direct and indirect subsidies to enterprises, the implementation of corporate tax, business and property ownership restrictions and ...