Can you analyze the Chinese Auto Industry's external environment (both that of the industry and the broader, general environment), focusing especially on external threats and opportunities and include an examination of the Key Success Factors (KSF's) that are necessary for operating successfully within this industry. (These are the competencies that all firms must possess.)
The Chinese Auto industry's broad general environment is located in the People's Republic of China. This is the second largest economy of the world. The People's Republic of China is also the fastest growing economy in the world. It is also the largest exporter and importer of goods in the world. The nominal GDP is $7.301 trillion in 2011, the GDP growth rate is 9.5% and the unemployment rate is 4.2%. The average gross salary is $4,260 per year making China an attractive destination for car production facilities. In addition, China has access to low cost raw materials like aluminum, steel, and other metals (Lardy. N, 2011),. China is a signatory to the WTO and plays an important role in the world market. Since, the economic reforms are continuously lifting people out of poverty; there is a steadily growing market for automobiles in China.
An important part of the Chinese Auto Environment is the local Chinese market. This is made up of indigenous companies like Chery, Great Wall, Wuling and Xiali. In most cases these manufacturers sell small, light vehicles that are suitable for Chinese businesses and consumers. The multinational competitors are the second part of the environment. These include Buick, Toyota, Ford, and GM. The strategy for entry used by multinationals is to form ...
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