(Henry, 2008), A PEST analysis is a business measurement tool. For example, The core competence of General Motors is innovation. Safety Regulations. There are four major factors affecting the automotive industry: technology, market, customers and the most influential factor â environment. With the right decisions there is no reason for GM not to become the automotive leader it once was. Liquidation is important to GM because their assets are a lot higher than revenues, and if GM could turn assets into cash then their would be more readily available funds and then GM would not have to depend some much on their U.S. sales, which only include 2/3 of that market and their financing tactic wouldn’t be as much of a risk. Read the case study Globalisation and the car industry.. Trends in social factors affect the demand for a company’s products and how that company operates. Automotive company is responsible for providing generous pension benefits to its employees, who at the time seemed like a great idea, however they are now experiencing problems as more and more aging people begin to collect their pensions. Furthermore, companies may change various management strategies to adapt to these social trends. (Jeffrey S., 2003). If you're selling a used car or truck, economic trends can have a big influence on your selling price and how easy it will be to make a deal. The top environmental factors of this industry are fuel economy and emission or clear air regulations are few challenges which have major impact on the growth of the economy. As far as possible, we all want to make the world better for future generations. This causes a lack of communication between employees from top to bottom and may have played a part in GM falling behind on the alternative energy movement. They can lead to improved sales growth, to increased earnings, or they can provide balance to a portfolio of businesses, which are some of the most commonly cited reasons for acquisitions. Registered office: Venture House, Cross Street, Arnold, Nottingham, Nottinghamshire, NG5 7PJ. By continuing you agree to the use of cookies. VAT Registration No: 842417633. Although GM’s market share in the US has dropped it is still very much competitive at 26 percent. Consider all of the hybrid and energy efficient vehicles that are being produced by car companies. It makes 60 million cars and trucks a year, and they are responsible for almost half the world's consumption of oil. In a industry where the number of people engaged in international travel has been predicted to reach the billion marks in 2010, there is concern about its contribution to the damage bone to the environment. Recommended strategies for General Motors would start with product development then market development, liquidation, and restructuring. Do you have a 2:1 degree or higher? American car buyers may change their buying habits quickly in response to factors like the state of the economy, the price of fuel and new automotive technologies. (www.daum.net/kia sarang), It is necessary to choose a number of distinct market segments and to target a few special product offerings to meet these customers’ needs. In terms of longevity, the diesel would be the winner today. (Stephen p., 2007). Flexible organizations are more likely to be able to adapt strategy to the changing environment. It is obvious that automotive industry was behind its competition with regards to the research and development of hybrid vehicles. Strategy analysis also deals with the organization’s internal environment. General Motors has substantial interests in telecommunications and space, aerospace and defense, consumer and automotive electronics, financial and insurance services, locomotives, automotive systems, and heavy-duty automatic transmissions. Our academic experts are ready and waiting to assist with any writing project you may have. This model is then ap- It’s based on the mission and goals of the organization and the roles that each business unit of the organization will play. This is the driving force behind its $190 above turnover. Technological factors include ecological and environmental aspects, such as R&D activity, automation, technology incentives and the rate of technological change. All want to make the world 's consumption of oil industry: technology, market, customers and the influential! Efficient vehicles that are being produced by car companies its $ 190 above turnover being produced by companies. 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