Mercedes-Benz and Dacia enjoy a good reputation as carmakers but in different ways. Although both companies are from the same industry, their markets, forces, strengths, weakness, opportunities and threats differ. Let’s analyse both companies in Spain.
I. Characteristics and attractiveness of the markets in which firms operate and how these are changing:
PESTEL Analysis Political: Spain is a stable democracy since 1978 and it is in the European Union. Spain is organized as a federal country and each region has its own Parliament and Government.
Economical: The car market is one of the biggest in Europe and finally it has emerged from the crisis and its growth in 2014 has been the biggest in 15 years. (Expansión, 2012) (ANFAC-SAMCT, 2014) …show more content…
It also gives prestige & status because it isn’t that you have just a car, you have a ‘Mercedes-Benz’ which means more than just a car.
Performance of the product: Mercedes-Benz produces better quality cars. Mercedes-Benz’s budget in R&D is so high to add last technologies to its cars and offers ‘the best of the best’ to its customers. On the other hand, Dacia’s customers demand an acceptable quality car but with a very low price.
Product design and input costs: Dacia uses Renault technology, engines and parts which has been proved with success in Renault’s cars some years before and it has reduced the fixed cost and the R&D budget to the minimum.
Efficiency of process: Dacia factories are in Romania and Morocco (Wikipedia, 2014) which are countries with low labor cost while Mercedes Benz is producing in more countries such as Spain, Germany, Finland… (Wikipedia, 2015) where the factories don’t get at its maximum capacity. Also, Dacia use Renault selling points too which decrease even more the cost.
As we see Mercedes-Benz uses a differentiation advantage and Dacia uses a cost
I. Characteristics and attractiveness of the markets in which firms operate and how these are changing:
PESTEL Analysis Political: Spain is a stable democracy since 1978 and it is in the European Union. Spain is organized as a federal country and each region has its own Parliament and Government.
Economical: The car market is one of the biggest in Europe and finally it has emerged from the crisis and its growth in 2014 has been the biggest in 15 years. (Expansión, 2012) (ANFAC-SAMCT, 2014) …show more content…
It also gives prestige & status because it isn’t that you have just a car, you have a ‘Mercedes-Benz’ which means more than just a car.
Performance of the product: Mercedes-Benz produces better quality cars. Mercedes-Benz’s budget in R&D is so high to add last technologies to its cars and offers ‘the best of the best’ to its customers. On the other hand, Dacia’s customers demand an acceptable quality car but with a very low price.
Product design and input costs: Dacia uses Renault technology, engines and parts which has been proved with success in Renault’s cars some years before and it has reduced the fixed cost and the R&D budget to the minimum.
Efficiency of process: Dacia factories are in Romania and Morocco (Wikipedia, 2014) which are countries with low labor cost while Mercedes Benz is producing in more countries such as Spain, Germany, Finland… (Wikipedia, 2015) where the factories don’t get at its maximum capacity. Also, Dacia use Renault selling points too which decrease even more the cost.
As we see Mercedes-Benz uses a differentiation advantage and Dacia uses a cost