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Analysis of Bmw

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Analysis of Bmw
Case Study Report

Strategic Management 313

Unit Index Number 3522

Semester 1, 2006

BMW Automobiles

[pic]

Group Members

Daniel Smentek, 13264679
Melanie Bernroitner, 13264682
Marie-Charlotte Neumann, 13264640

Submitted on, May 16, 2006

Table of Contents

Executive Summary 4

Introduction 5

BMW and the Automobile Industry 6

Aspects of the Automobile Industry 6

Historical Background of BMW 6

BMW in the Global Environment 9

General Environment of the Automobile Industry 9

Five Forces of the Automobile Industry 14

Competitive Structure of the Automobile Industry 17

BMW’s Direct Competition 22

BMW’s Resources and Capabilities 25

Tangible Resources 25

Intangible Resources: 28

Capabilities 29

Core Competencies 30

Potential Action Steps for BMW 33

BMW’s Strategy towards Success 37

References 41

Appendices 45

List of Illustrations

Figure 1: Report 's Course of Action 5

Figure 2: Labour Costs in EU Countries 2005 11

Figure 3: Outcome of General Environment Analysis 14

Figure 4: Evaluation of Porter 's Five Forces of Competition 17

Figure 5: Strategic Map 20

Figure 6: Profit Margins 26

Figure 7: SWOT Analysis BMW 2006 33

Executive Summary

The following report analyses the automobile operations of the BMW group in regard to its competitive position in the automobile market. BMW is a German premium car manufacturer comprising the three brands BMW, Mini and Rolls-Royce.

The analysis of the external environment indicates an attractive but challenging general environment. The industry environment shows low threat of new entrants, low bargaining power of suppliers, high bargaining power of buyers, moderate threat of substitute products and intense rivalry among competitors. In order to get a better understanding of the industry’s competitive structure, a strategic map has been developed. Thereby the DaimlerChrysler’s Mercedes Car Group has been



References: 'BMW AG 2005 Company Profile Edition 3: SWOT Analysis ' 2005, Just - Auto, pp. pp. 9-10. Retrieved March 22, 2006, from ProQuest database. 'BMW AG - 2005 company profile edition 3: Competitor Analysis ' 2005, Just - Auto, pp. pp. 7-9. Retrieved May 7, 2006, from ProQuest database. BMW Business Strategy. Retrieved March 23, 2006, from http://www.coursework.info/i/30354.html. Bradley, D, Bruns, M, Fleming, A, Ling, J, Margolin, L & Roman, F 2005, Automotive industry analysis. Retrieved March 23, 2006, from http://www.srl.gatech.edu/Members/bbradley/me6753.industryanalysis.teamA.pdf. Button, L 2005, Why did BMW buy Rover? Retrieved April 24, 2006, from http://www.austin-rover.co.uk/index.htm?whydbbrf.htm. Car classification 2006. Retrieved March 23, 2006, from http://en.wikipedia.org/wiki/Car_classification. 'DaimlerChrysler AG - 2005 company profile edition 3: Company Dossier ' 2005, Just - Auto, pp. pp. 1-4. Retrieved March 21, 2006, from ProQuest database. 'DaimlerChrysler AG - 2005 company profile edition 3: Key events ' 2005, Just - Auto, pp. pp. 13-15. Retrieved March 21, 2006, from ProQuest database. 'DaimlerChrysler AG - 2005 company profile edition 3: Product Development ' 2005, Just - Auto, pp. pp. 23-27. Retrieved March 21, 2006, from ProQuest database. 'DaimlerChrysler AG - 2005 company profile edition 3: Prospects ' 2005, Just - Auto, pp. pp. 28-30. Retrieved March 21, 2006, from ProQuest database. 'DaimlerChrysler AG - 2005 company profile edition 3: SWOT Analysis ' 2005, Just - Auto, pp. pp. 15-17. Retrieved March 21, 2006, from ProQuest database. DaimlerChrysler AG 2005, DaimlerChrysler - Facts and Figures, Edition 2005. Retrieved March 25, 2006, from http://www.daimlerchrysler.com/Projects/c2c/channel/documents/665796_facts_and_figures_2005_e.pdf. 'DaimlerChrysler: In tandem (at last) ' 2006, The Economist, vol. 378, no. 8471, pp. 50-52. Retrieved May 14, 2006, from Business Source Premier database. Danzig, A 2004, BMW changes lanes. Retrieved March 23, 2006, from http://www.brandchannel.com/features_profile.asp?pr_id=171. Gordon, ME & Milne, GR 1999, 'Selecting the dimensions that define strategic groups: A novel market-driven approach ', Journal of Managerial Issues, vol. 11, no. 2, pp. pp. 213-233. Retrieved March 21, 2006, from ProQuest database. Gow, D 2005, Record sales but BMW suffers. Retrieved May 10, 2006, from http://www.guardian.co.uk/cars/story/0,1475833,00.html. Hunger, JD n.d., Industry Analysis: Analyzing the task environment. Retrieved March 21, 2006, from http://www.public.iastate.edu/~jdhunger/310Spr99/IndAn.html. J. D. Power and Associates 2005, 2005 Initial Quality Study. Retrieved March 23, 2006, from http://www.jdpower.com/pdf/2005069c.pdf. Jackson, T 1998, 'Common Sense and Your Core Competency: How do Companies Decide which are the Truly Essential Elements of their Business? ' Financial Times London, October 22, 1998, p. 13. Retrieved March 22, 2006, from ProQuest. Kriegesmann, B, Kley, T & Schwering, MG 2005, 'Creative Errors and Heroic Failures: Capturing their Innovative Potential ', The Journal of Business Strategy, vol. 26, no. 3, pp. pp. 57-64. Retrieved March 23, 2006, from Business Source Premier database. Labour costs in EU countries 2005. Retrieved May 2, 2006, from http://www.ek.fi/ek_englanti/figures_in_labour_market/15092005_kvtyomarkkinavertailukuvat/labour_costsEU25_2005.pdf. Lee, K & Ni, S 2002, 'On the dynamic effects of oil price shocks: a study using industry level data ', Journal of Monetary Economics, vol. 49, no. 4, pp. 823 - 852. Retrieved March 16, 2006, from ScienceDirect database. McElroy, J 2004, 'Good Intentions Bad for U.S. ' Ward 's Auto World, vol. 40, no. 8, p. 17. Retrieved March 17, 2006, from Proquest database. North Dakota State University n.d., Strategic Group Map. Retrieved March 20, 2006, from http://www.ndsu.nodak.edu/instruct/kfroelic/789ch4-2.ppt. Opec Annual Statistical Bulletin 2004. Retrieved March 11, 2006, from http://www.opec.org/library/Annual%20Statistical%20Bulletin/pdf/ASB2004.pdf. Reichste Länder der Welt 2004. Retrieved March 29, 2006, from http://www.learn-line.nrw.de/angebote/agenda21/archiv/05/daten/g9596reichsteLaender.htm. Subramaniam, N 1999, The European Automotive Industry - Segmentation and Strategic Groups. Retrieved March 21, 2006, from http://members.tripod.com/cometonada/segmentation.htm.

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