Mercedes-Benz

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In the early 1990s well known automobile company, Mercedes-Benz began investing the feasibility of producing a luxury sports-utility vehicle which is referred to as the Multi-Purpose vehicle (MPV).In that time there was an increasing international competition among the automobile companies. Because of that Mercedes-Benz deviated from its ongoing and established procedures and staffed the project team with a young group of employees. The project team was consisting with young product planners, engineers and marketers. Also the main objective of the project team was, finding a site outside of Germany to Built the MPV. Because up to this time, all the Mercedes-Benz products had been built in Germany. Also at that time the combined cost of labor, shipping cost and the cost of the components were very high in Germany. The costs of the these areas were particularly important since MPV was to priced about the same as a fully loaded jeep Grand Cherokee which was designed by another well known company called Fiat. The main concern about the project location planning was to minimize the transportation cost. The project team initially narrowed the search for the new facility to North America, because the combined cost of labor, shipping cost and the cost of the components would be lowest in that region.
The project team did various kind of analysis to find the best and most suitable place to establish their new site. After this further analysis, the team decided to limit the search to sites in the United States in order to be close to the primary market and to avoid the penalties associated with currency fluctuations. After that the project team identified 100 possible sites in 35 states. As it began the analyzing the sites, its primary concern was the cost of transportation. Since the MPV was going to built only in the United States and half of its output would be exported, the project team focused on sites near Atlantic or Gulf seaports ,major highways, Also the team

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