Volkswagen Company has been using various strategies to expand globally. These strategies include taking opportunity of other companies’ or competitor’s weakness to expand its market share. Despite having its product quality issues, Volkswagen Company in the United States has utilized Toyota’s negative headlines after a series of embarrassing recalls to increase its sales.
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Due to this back slide by Toyota Company Volkswagen Company ceased the opportunity and put a target of emerging biggest automobile by 2018. Volkswagen Company has expanded globally through purchasing various motor vehicles companies in the world.
It bought 20 percent stake in Suzuki motor to cover up the emerging market opportunities in India and Southeast Asia. Its current plans include securing stake in BMW, Audi, and SEAT from Spain, Skoda from the Czech Republic and Mercedes in the next three years. Also, it intends to steal customer from Toyota, Honda, Ford, and other companies selling vehicles in American by introducing new styles at affordable prices.
Improving its reputation by making reliable and under priced vehicle than Subaru and Kia is one of its strategies. Volkswagen Company is pushing hard to make its vehicle brands known in Toyota’s strongholds such as south East Asia. Rewarding employees for speaking their minds and rising new ideas is also another strategy used by the company to expand globally.
The latter includes board brainstorming ways to become the world’s biggest automobile makers. Building Volkswagen Company plants in various countries in order to tap those customers opposed to idea of importing cars is another strategy used by Volkswagen Company to expand globally.
There are various specific and general forces in the environment which affects the success of Volkswagen Company strategies. Environmental forces which are political, economic, technological, socio-cultural, and international influence the strategies of Volkswagen Company.
Environmental forces determine the success of this company’s strategies. These forces vary among countries hence influencing the applicability of these strategies in those countries. Negative and unfavorable forces deter Volkswagen Company’s strategies success. Merging of opponent companies has created a strong pricing and market share competition against this company. Natural disaster and war are other environmental forces which negatively affect Volkswagen Company.
Volkswagen Company new initiative of becoming the world’s largest manufacturer of cars by 2018 is advancing on well. In the past few years Volkswagen Company had growth market share and sales proliferation. Although Toyota remains the largest automaker in the world, Volkswagen Company has narrowed the gap and it intents to overtake both General Motors and Toyota Company by 2018.
In effort to gain bigger market share and create public positive image, Volkswagen Company has opened a plant in Chattanooga to cater for the large market in the United States. This was after realizing that many people from the United States did not prefer purchasing imported vehicles, but opted for locally assembled vehicles. This move was also geared to facilitate accessibility of Volkswagen Company’s vehicles such as Audi as compared to Mercedes and BMW.
Also, Volkswagen Company is focused to make its existing brands stronger rather than acquiring more global companies. Volkswagen Company has acquired new markets in China. Studies show that Volkswagen Company sells more vehicles in China than General Motors. In addition, Volkswagen Company has been working relentlessly to acquire new markets in South America, India and Africa.