Smart Cars Case Study

Register to read the introduction… Overlooking the development and installation of the supply chain, all of which had been done since the first feasibility study of Mercedes in 1993 and the foundation of MCC in 1994, the management team realized it was facing a new set of challenges. The supply chain are completely new in the market and go beyond such existing practices as supplier involvement, outsourcing and modular production in the industry. Modules such as complete frontor rear ends are pre-assembled on site and suppliers are involved in design and final assembly through co-ownership of the site, co-design and some major share in the manufacturing activities. Given the untraditional approach, MCC executives face some fundamental challenges including how to manage and control a supply chain in which MCC only adds some 15% of the operational value added. This question is not only relevant to MCC but to the Daimler- Benz Corporation as a whole, which has set Smart as a strategic learning project. Moreover, the concept being brought to practice by MCC is generally accepted by leading car-manufacturers as of key importance to future industry developments. Manufacturers and suppliers therefore monitor the successes and failures of MCC, as the results will mark the future organization of their companies and of the supply chain. Smart has now been an issue of concern as its sales performance has not met the company's …show more content…
In February 2005, Reuters reported that the Smart car had made a loss of about 600 million euros in 2004 and sales have remained relatively low compared to the company's forecasted numbers up until now. It seems as if the mobility concept of smart cars did not quite take off as the company had originally hoped. Questions have been raised whether or not the smart cars are truly economical and if its benefits justify its …show more content…
SMART should certainly utilize the Mercedes-Benz know-how on designs and innovative technologies while focusing on its electric vehicle as its core value, possibly through training programs. This would undoubtedly call for further integration between Mercedes Benz and SMART. The car would have looked innovative 20 years ago with its current design. While Smart cars may meet with wide acceptance in Europe, MCC may need to modify the product to meet consumers’ expectations if they would want to further expand and penetrate in other markets. They should establish more distribution centers and spend more on advertisements, promotions and test trials as a market penetration strategy for their current products in their current markets. As Smart cars are primarily well known for customer personalization, they should offer a highest degree of customization to meet and exceed customer's expectations. They should also look at a diversification strategy where they can produce compact buses and trucks for city use to further ease the traffic on the roads. One more thing SMART should do is to broaden the target market. They need to make the electric/ hybrid cars more appealing for consumers of wider