StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Car Industry in China: Peugeot - Assignment Example

Cite this document
Summary
The author of the "Car Industry in China: Peugeot" paper focuses on the car industry in china, Peugeot, which has received world attention for its high levels of integration and diversification and more importantly the relevance of its automotive products…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER91.1% of users find it useful
Car Industry in China: Peugeot
Read Text Preview

Extract of sample "Car Industry in China: Peugeot"

 The level of the duo in the car industry in China has been described as representing the level of the country’s economic development, which attracts colossal world attention. The following are the areas where diversification and integration have been explored in a very relevant way in its automotive dealings: China's car industry has immensely gone into increased outsourcing and bundling of more valuable chain activity in supply firms.

This is a way has increased trade while increasing the capability of the suppliers in the country. Another area of integration is the direct investment, global production, and cross border which lead to a dramatic boom in the sale of vehicles in the industry of Peugeot in China industry. China's car industry has embraced the aspect of carrying out the product design, production of most engines and transitions, and above all, they do the assembly of automobiles in the same facility. This is what they have diversified into and integrated into so that all is done under one roof.

This has come with its shortcomings. The concentration of highly integrated industries such as china industries tends to create a barrier to entry and limits the upgrading of smaller firms because of what economist term as cannibalization of smaller industries through integration and diversification of bigger industries (KNECHT, 2014, p. 57). COMPETITIVE ADVANTAGE Competitive advantage is what the China industry has in possession that is unique to other industries and acts as an advantage in the market.

Some of this uniqueness is natural while others are developed which give it an assortment of advantage to outperform other industries in the market. First, China has a huge population with considerable purchasing power, which helps it sustain its market even before they think of importing another model of the car for its internal market or exporting its own for the clients that need its make. This boosts the manufacturing of cars in this industry. Another area that the industry has tried to develop is the government coming in to help it develop a robust industry that can compete with other even stronger industries.

Most of the carmaker in China is mostly state-owned enterprises (SOEs), and the government usually provide the massive financing necessary to create a domestic giant. Here, the maintenance of car part tariffs at a higher notch than others encourages a setup of local and domestic part supply networks, which has placed the china industry in a critical position when it comes to marketing. Finally, there is a protectionism policy in the car industry of China. This has protected the industry from other more developed industries in countries such as Japan and Korea, which in themselves proved that the policy of government intervention can greatly contribute to a quick expansion of the export-oriented automobile industry.

The car industry of China is fully backed up by formal state industry policy for that matter since 1987 and then modified in 1994 to date. China has used this policy to regulate inward investment by screening, foreign equity limits, and local content requirements to narrow the technology gap (PENG, M. W, 2009) ABSOLUTE ADVANTAGE In the economy, this principle of absolute advantage is very important in industries that compete with other far much established and robust industries. In this principle, China's car industry, Peugeot, has been given the advantage to produce more cars and other products than other industries using the same resources as other competitors.

Most of the policies have evolved toward globalization to promote indigenous industries with the harmonized industrial organization but the car, industry getting the absolute advantage in that line (SKIN, & BOWEN, 2013). SUMMARY It has been seen that the car industry, Peugeot, to be precise has every advantage in every frontline that gives it a better placement in the market to get worldwide attention. In its tact, it has employed the framework of Adaptation, Aggregation, and Arbitrage (AAA), Porter 3 generic strategies (cost leadership, differentiation, focus, and hybrid).

In addition, it has employed a lot of diversification and integration that has increased the product on the market. China's car industry in its frontier has also enjoyed the competitive advantage of the high population it enjoys across the globe and protectionism policies. 

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Competitive Strategy-car industry in china peugeot/AAA-Diversification Assignment”, n.d.)
Competitive Strategy-car industry in china peugeot/AAA-Diversification Assignment. Retrieved from https://studentshare.org/business/1648012-competitive-strategy-car-industry-in-china-peugeotaaa-diversification-and-integration-competitive-advantage-absolute-advantage
(Competitive Strategy-Car Industry in China peugeot/AAA-Diversification Assignment)
Competitive Strategy-Car Industry in China peugeot/AAA-Diversification Assignment. https://studentshare.org/business/1648012-competitive-strategy-car-industry-in-china-peugeotaaa-diversification-and-integration-competitive-advantage-absolute-advantage.
“Competitive Strategy-Car Industry in China peugeot/AAA-Diversification Assignment”, n.d. https://studentshare.org/business/1648012-competitive-strategy-car-industry-in-china-peugeotaaa-diversification-and-integration-competitive-advantage-absolute-advantage.
  • Cited: 1 times

CHECK THESE SAMPLES OF Car Industry in China: Peugeot

The Automobile Industry of Canada

The paper "The Automobile Industry of Canada" states that peugeot, a French company, is ranked sixth in the international ranking of the automobile industry.... peugeot already has its existence in the Canadian market with their motorbikes.... With fluctuating oil prices, growing environmental concerns and the expected forecast of growth, the time is ripe for peugeot to enter the Canadian market with its full range of products.... peugeot has a competitive edge in the Canadian market with an already-developed distribution system....
16 Pages (4000 words) Essay

The Scorecard Measures Between Toyota and Peugeot

The author of the paper under the title "The Scorecard Measures Between Toyota and peugeot" argues in a well-organized manner that the role of various factors in a firm's performance has been extensively studied in the context of management accounting.... At the next level, two alternative strategic management techniques are suggested for another well-known firm in the global automotive industry, peugeot, at the level that these techniques could possibly help the organization to measure its performance more effectively....
8 Pages (2000 words) Essay

Trends in the Car Industry

The author of the paper "Trends in the car industry" will begin with the statement that the car industry is not only capital intensive but labor also plays an important.... Despite the rise in the use of robots in the industry, the cost of labor is still considerable.... Therefore, consumers and their changing demands for the industry become an important consideration.... echnological & Environmental Concerns: Technological changes and advances have also become a key factor in the industry....
14 Pages (3500 words) Assignment

British Motor Industry and Government Strategy

From the 1950s where the United States dominated with a 100% market share amongst the 3 giants General Motors (GM), Ford and Chrysler, it changed to a position where the US lost its share to 52% while Japan cemented her place with a 43% share by 2005 (BBC "The car industry").... This situation, however, has now changed with many Eastern Europe countries and Asian countries such as china and India entering the automobile industry.... Since the beginning of this decade, the industry has seen the emergence of several new players predominantly from china and India and some Eastern Europe countries....
7 Pages (1750 words) Essay

The World Trade Organization

Though China opened up itself to many Western concepts the way different concepts have been adopted and used in china differs a lot from the West.... china's FDI & WTO AccessionChina re-emerged recently as the fastest growing economy in the world.... china still has greater challenges to face as it moves from a centrally planned economy to a socialist market economy on its accession to WTO....
7 Pages (1750 words) Case Study

Chinas automobile industry Chapter 1 and 3

Considering the success of China's automobile industry, this report will focus on identifying, analysing, and concluding whether or not the Started in 1984, the first wave of investment in the automobile industry in china includes the establishment of Beijing Jeep and Shanghai Volkswagen (Wu, 2006).... In 2009, the total number of cars, trucks and other vehicles sold in china was 13.... he main objective of this study is to gather existing and most current literature regarding the degree of competition in china's automobile industry....
4 Pages (1000 words) Essay

Ethical and Social Responsibilities of a Peugeot Group

The paper "Ethical and Social Responsibilities of a peugeot Group" describes that the actions of PSA peugeot Citroen Group are towards the implementation of policies and programs, intended for the improvement of its industrial facilities that encourages the protection of the environment.... SA peugeot Citroen has signed an international agreement on social responsibility.... They have committed to respecting fundamental human rights, sharing social needs with industrial partners, sales network team, sub-contractors, and suppliers, and impacting of company's activities upon the local boundaries (PSA peugeot Citroen, n....
6 Pages (1500 words) Essay

Discuss the role of multinationals in the globalization of innovation

Let us take the case of those companies trying to invest in china for them to avail of the country's resources such as the work force and its associated lower cost.... This paper has something to do with the discourse of globalization of innovation by which the multinational companies have become the driving forces of this process, so as for them to proliferate in their respective industry or niche....
8 Pages (2000 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us