Introduction
Currently, the automotive industry is very saturated with various car manufacturers. The level of competition in this industry has increased the adoption of novel technologies intended to improve the quality of the manufactured car brands as well as competitive advantage. Despite the existence of many industrial leaders namely Ford, General Motors amongst others, Chrysler Corporation has emerged to be amongst the most globally cost-effective car manufacturers.
However, it is doubted whether this company will be able to withstand the market competitiveness given its weaknesses. The purpose of this paper is to analyze the current internal business operations of Chrysler Corp. and its chances to survive in the market of digital technologies. The business internal assessment will analyzed using tools such as PEST and SWOT.
PEST Analysis
Political
When the state delivers freedom and suitable national infrastructure, it has to motivate the auto industry and enforce rheostat over their usage. The auto industries create employment opportunities, and the state should back the auto architects. For instance, Chrysler was salvaged through a special national mortgage assurance plan by the U.S. administration.
Chrysler signed a treaty with the administrations about policies regarding its security and operational backgrounds. However, Chrysler business operations are structured and incorporated in the German National Democratic Bylaws.
Economic
The Chrysler Company needs to amalgamate with other corporations to dominate the auto industry and endure the poor economic conditions. From the unexpected decrease in the costs of cars in the EU, the corporation ought to have endorsed the slogan, ‘be trampled, or consume. Actually, a solitary coinage in Europe is enough to self-drive the creation of superior transparency of prices. This augments the enthusiasm for Chrysler unification with other companies.
There is a lot of pressure exerted on the marginal costs because of the increased market share and competition. Currently, the auto industry is operating at a rate of twenty six percent (26%) thus; the companies like Chrysler might fall short of fuel prices (Taylor, 2010).
Social
In the industrialized states, the auto industry has transformed the lives of several individuals. It has provided the newfangled opportunities for vacation and work as well as the degree of freedom. The corp. holds a position in Asia, North America, and European automotive marketplaces that are rich in consumers.
Chrysler transports numerous products to varied societies as these nations have different capabilities to effortlessly buying autos in bulk. Therefore, Chrysler is the US countrywide pride and the European bazaars endorse it since the Germans can purchase Mercedes whereas the Americans acquire Chryslers. The European motor industry growth rate ranges amid 2.50 % and 3.50%.
Technological
The technological changes deduce that Chrysler needs to be cautious about the fresh fuel shifting autos. Moreover, due to the capabilities of commodities advertisements, the availability of extra info, the company must make certain the sustained development of internet.
Hence, to protect the consumers and curtail the operational costs, Chrysler channels cash to digital technology development. The company can develop the digital entertaining devices including DVD lectors in cars. Diverse markets provide a variety of DaimlerChrysler products namely; trucks, buses, heavy commercial automobiles, sports utility vehicles, and compacts (Berger, 2011).
Conversely, the automotive electrical appliances are produced from its Auto Electronics. However, the company faces competition from other souks and sections like BMW, Honda, Citroen-Peugeot, Fiat, Renault, Volkswagen, Toyota, Ford, and General Motors. Generally, Chrysler is ranked amongst the dominant auto market leaders.
SWOT Analysis
Strengths
- The V-8 Hemi locomotive repute. Amongst the key strengths of Chrysler is the V-8 Hemi locomotive reputation. From the fiscal 1951 after unveiling the V-8 locomotive (Hemi engine) of munitions, Chrysler has remained a renowned horse-power race leader. Therefore, for approximately forty-nine years the Hemi-device is acknowledged for its dominance. The enterprises of auto engine in this corporation get backing from the establishment of Hemi engine even though the company proclaimed to frontier its newfangled products usage (Taylor, 2010).
- The minicab souk authority. According to Taylor (2010), the other strength of Chrysler Corp is its more than twenty-six years minicab souk control. The Dodge and Chrysler companies still grasp more than forty percent (40%) of shares in the minivan markets of the United States. Indeed, this happened even though large numbers of auto market rivals maneuvered to multiply their market shares owing to the recent collapse of auto markets. On centering on this market situation, Chrysler develops an advantage over its opponents.
- The consumer’s focus. The auto consumer focus has enabled Chrysler to remain one of the unique corporations to employ a chief purchaser administrator. Chrysler did not formerly regard purchaser care as its strong point. However, there is a fortified establishment of the pronounced spirited advantage since this strength is an important facet market enhancement.
Weaknesses
- The decreasing and slight market shares. The general market share for Chrysler is deteriorating in spite of its dominance in the minivan souk. Chrysler’s market share fell to 9.30% from 11.21% in the fiscal 2009. Hence, Chrysler faces demerits over other automakers’ contestants irrespective of its petty increase (9.6%) in market share by 2010 September.
- Difficulties in administration. Prior to Cerberus Investment Administration privately held it in the year two thousand and seven, Chrysler Corp was a muddle enthused by citizens from Germany owing to Daimler partnering with it in nineteen ninety-eight. Besides, the new administrator is betrothed in the monetary business, but not in auto trade and above all lacks experience and knowledge in the vehicle industry. For this reason, market analysts consider that Cerberus getting hold of Chrysler denoted the culmination of its acknowledgment as an entity tangled in auto creation.
- The bottlenecks of eminence. Chrysler faces adverse effect on buyers’ choices while purchasing its products. Thus, it is a weakness as its vehicles in accordance to Power J.D and Customer Reports are the worst graded in the list.
Opportunities
- Chrysler’s partnering with Fiat and Daimler. Chrysler might create numerous opportunities via the Fiat and Daimler tactical affiliation. To enter the BRIC souks, this company is obliged to possess minor autos albeit SUV and minicab are its sturdy places. The joint venture with Fiat would empower Chrysler to generate more small cars for the fresh markets as Fiat is well recognized for its smaller wagons.
- The increased green car demand. By 2015, the United States would cater for 55.49% as the emerald auto bazaar is estimated to top three million as it is on the rise. In addition, the corporation can develop its situation due to abundant opportunity as one of the major emphases of Chrysler is producing emerald cars.
Threats
- The dealers’ disappointment. The ingenuity consolidation of a dealer with Daimler being the controller of Chrysler’s businesses has led to the wearing out of passion to vend cars. Actually, it resulted from a situation where a dealer receives more vehicles than he might probably sell. It remains a gigantic hurdle to the business since the new administrator has certainly not fixed this difficulty.
- The United States marketplace reliance. Grant (2010) claims that more than 90.48 % of Chrysler’s deals emanate from the North America due to the company’s over reliance on United States marketplaces. Through stern rivalry and the deteriorating demands in the auto market, Chrysler might be actually susceptible to market risks.
Conclusion
Chrysler Corp has grown-up into a multi-million corporation from the fully-fledged small business since its incorporation. Despites the speculations that Chrysler may not survive in the currently competitive digital technology automobile market due to its apparent weaknesses, this Chrysler business operation assessment clearly shows that it is possible that Chrysler will survive and remain dominant in the automotive industry. The strengths of this corporation clearly outweigh its weaknesses. This is enhanced through its established background and the influence it has in the industry.
Works Cited
Berger, Alexander. Global Corporate Strategy – Honda Case Study. Munich, Germany: GRIN Verlag, 2011. Print.
Grant, Robert. Contemporary Strategy Analysis: Text Only. Hoboken, New Jersey: John Wiley and Sons, 2010. Print.
Taylor, Antony. Can Chrysler Survive? Fortune, 158.3(2010): 110-117. Print.