The Porter's Five Forces Model
The Porter's Five Forces model helps an organization identify the weaknesses and strengths of their industry, in which they adjust their strategy to these outcomes to obtain maximum profitability. The model consists of 5 factors: competitive rivalry, supplier power, buyer power, threat of substitution and threat of new entry. This model will be use for the German automotive industry to see the steps Mercedes-Benz should take to improve.
Competitive Rivalry
As mentioned before, the automotive industry makes up 20% of Germany revenue. With 13.3 million euros investments in 2015,there is a huge competitive market with many car producers aiming for improvement and innovation(GTAI, 2017). Additionally, …show more content…
However, owning a car provides many benefits ranging from practicality to obtaining status.
As the market is changing and demand for electric cars are increasing, upcoming companies like Tesla will remain as one of the biggest threats for Mercedes. Mercedes has yet to release their product line of electric cars into the market, and this caused them to be one step behind the market's demands and trends("Tesla, Inc,2018").
Despite the entrance of new substitutes, namely the electric automotive passenger vehicles, the threat of substitutes is between low and moderate as demands for automotive vehicles increases (GTAI, 2017). This is due to the significance of the automotive industry as well as its impact on the economy. ("VDA", 2018")
Stakeholder Analysis
A stakeholder matrix contains the amount of influence and interest of stakeholders of an specific company. Stakeholders are any person who is interested in an organisation or and can influence it, hence benefit from the company. The stakeholders have different roles and their level of involvement in the company differs from high involvement to low/ no interest at