MANAGEMENT

International Market Entry and Development of Automobiles in USA

Executive Summary

The automotive industry in the United States of America has an immense impact on domestic economy. The turnover from new cars sold in the year 2011 was a signal of the economic health of the country. The decrease in consumer purchasing power as a consequence of the global financial crisis that hit in the year 2007-08, the demand for the automobile industry has picked up for the first time. the global financial crisis, the US government has adopted a remedial stance. For instance, generous loans were given to General Motors and Chrysler whereas Toyota got the loan from the Japanese government. The loans were payment with the view of helping the giant automobile manufacturers to survive the economic downturn. The industry is running on overcapacity. This is reflected in the graph shown below. The success of companies is reflected in their proactive approach. More and more companies have resolved to adaptability whereby the bigger cars are now replaces with smaller fuel efficient hybrid models of cars. . As far the US market is concerned, the best strategy would be to enter using either of the ownership strategies or the Foreign Production as an Entry Strategy. The benefit of foreign production on the entry strategy is that the company is not putting too much at stake. They are manufacturing in some other location and bringing in only the number of cars that have to be produced for the demand.

International Market Entry and Development of Automobiles in USA

Introduction

The automotive industry in the United States of America has an immense impact on domestic economy. The turnover from new cars sold in the year 2011 was a signal of the economic health of the country. The decrease in consumer purchasing power as a consequence of the global financial crisis that hit in the year 2007-08, the demand for the automobile industry has picked up for the first time. It would not be wrong to say that the industry as a whole is marching on its road to recovery. The paper presents the latest and most relevant research into international market entry and development in the automotive industry in US (Brady, 2011, p. 99). It discusses the current issues in international and global marketing, the evaluation of the identified causes with discussion on strategies adopted by different market players for success and recommendations for appropriate market entry strategy and forecast of likely difficulties.

Current issues in international and global marketing and market development

PESTEL Analysis

The PESTEL analysis for the US automobile industry is given hereunder.

Political

The automobile industry in the United States of America is affected by the laws that govern it since the early 1960s. These laws and regulations have changed over time considerably whereby most of the changes were driven by growing consumer concerns for safety and environment. The importance of regulation and close monitoring of this industry by government must be understood from the fact that it is closely linked with many other important industries ...