The Great Wall structure Motors Business Essay

This narrative give attention to the competitive position of great wall membrane motors which is one of the most notable privately owned venture in China was given on both A share market in china mainland and H share market on Honkong. THE FANTASTIC wall motors proven in 1976 which is named following the Great Wall of China (wiki). The company started with manufacturing of Great wall light vans and great wall structure deer pickups. The fantastic wall deer pickups create a breakthrough in the creation line of the company. By the finish of 1998 great wall pickups ranked No. 1 in local pickup market. Nowadays Great wall structure motors reach the most notable level by producing 3 main types of Haval SUV, Great Wall structure Computer and Wingle Pickup with an increase of than 30 supplementary branches with 45000 employees. Today Haval SUV suffered the top get ranking in sales and export level in China for 9 years and Wingle Pickup rated first in models of market show, export level and sales in China. It has achieved a reasonably good brand by producing a monthly sales of above 10, 000 items illustrates its excellent capacity when compared to Joint-Venture brands.

Great wall motors brand idea stick on specialization, dedication and emphasis. This philosophy helps to illustrate its proper eye-sight and specialising soul from dedicated target philosophy to effective functional management and conclusively to worldwide leading brand. Moreover its brand strategy targets creating a category of leading brands. The brand development strategy of Great wall motors helps them to be keeping rate with the world tide.

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External Environment

The Environment is a construction that provides means of success for the company. It can bring danger as well as opportunities to the organisation(Johnson, et al. , 2010). This part analyses the external environment of great wall membrane motors using Pestle analysis.

Pestle analysis

Organisational environment includes all the elements beyond your boundary of company that can create potential impact to the company favorably and negatively(Samson & Daft, 2012). Pestle analysis is a tool used for analysing the macro-environment in which the organisation operates. It really is an instrument that specifically scans the political, economical, social, scientific, legal and environmental factors that influences the company and it can even be used to judge the market growth and decrease. Pestle lists of 6 exterior environmental factors are make clear later in appendix 1. However, This part examins in detail about the 6 pestle factors that influences the fantastic wall's environment.

(Downey, J. (2007). Proper analysis tools. London: The Chartered Institute of Management Accountants)

a. Technological

Technological factors addresses different methods used by organisation to provide better useful and quality products with in lowest time slots(Njanja, Martin, & Rene', 2012). It offers just how company establish its work methods and habits, knowledge, materials, tools and methods used for obtaining expected outcome and lastly how the information structures used. In this modern world of technology, It become one of the response for many issues that restrict the development of business(Njanja, et al. , 2012). For Chinese language automobile companies it isn't satisfactory to clutch production capacity so they need to implement more progressive techniques. So Great wall membrane motors significantly stimulates technical progress and enhancements and assert on 3rd party R & D within the organisation (CHINA: Great Wall structure Motors first science-and-technology celebration inaugurated, 2011). During previous 5 years, Great wall structure motors has spent more than 3 billion RMB for the development and software for R &D. Such that it has been licensed as High-Tech Firm, Postdoctoral Knowledge research Institute, Country wide Recognized corporation Technique centre, National ground breaking corporation, Provincial vehicle engineering strategy centre. Great wall structure motors would utilise the exclusive pool of development and improvements for China's car brands. As a result of these great-leap-forward innovations Great wall membrane motors succeeded to achieve international quality standards in performance of vehicles because of their existing and future models like Germany vehicles standard in controlling stability and bodywork rigidity, NCAP five stars standards in safety, Japanese vehicle standard in NVH, reassuring wear, delightful project and North American, Western and other high-end target market requirements in emission(CHINA: Great Wall structure Motors first science-and-technology event inaugurated, 2011). Great wall motors likely to spend a 5 more billions to R &D development in the coming years so as to build high grade well preserved international R&D with better experiment facilities, to set up a well trained and efficient international R&D, to conquer world level first class technical improvements, to satisfy complex demands or dreams of customers to be able to rocket their additional value and improve their competitive ability of products.

b. Friendly:

In china, customers are not much enthusiastic about crossbreed and electric technology, so there are not many businesses producing hybrid autos and electric cars. It includes better chance of great wall membrane motors in this field as they may have only limited competitors. For a short run, they can have a great market show in this field. However in a long run, more contests will appear, when more and more firms came up to utilize this technology.

Today customers are looking for better undertaking and mileage autos. Hybrid vehicles of great wall motors have better mileage and performance when equate to other hybrid vehicles. But it is not up to the amount of petrol automobiles performance, so still customers choose to use petrol autos because of their standard performance. So it is very much indeed mandatory to boost their technology in hybrid cars to make its performance better than petrol cars.

c. Economic

As due to severe price hike of petrol the demand for hybrid and electric autos are continually increasing. Great wall structure motors is one of the leading vehicle company in china conducting its research and development in cross types as well as electric automobiles. Due to price hike in oil the demand for petrol autos are dropping down. On one hand, they can impose or create their hybrid and electric car technologies as the demand because of this are increasing. But on the other hand, as there are hybrid or electric vehicles, customers were less thinking about buying their petrol cars. Because they have cross and electric cars, their revenue is not going to breakdown even if there is fall in demand of petrol automobiles. In an extended run, they can improve their sales and productions by concentrating more on cross types and electric vehicles.

Chinese car market shows a severe progress of 1/3 just lately. This implies still there can be found more opportunities for great wall motors to grow and broaden their activities. They can develop their sales and income more if the marketplace is bigger.

d. political: role of government

Chinese government will invest billions of dollars in hybrid technology. Great wall membrane motors is one of the auto company popular for its research and development in cross types technology. If they successfully demonstrated that their technology is worth for investment, they can get billions of dollars because of their research & development in this technology.

Now Chinese federal is planning to buy a large number of hybrid vehicles for use in china within 24 months. As great wall motors are already producing hybrid autos, the plan of Chinese federal may put them forth to increase their development to fulfil the needs of their administration.

Recently, the official vehicle options adopted by ministry of industry and it were announced. Including Haval H6 and H5, 25 vehicles of GWM were stated. As a result Haval become most visible brand in the inventory. SUV because of its flexibility it becomes a model with fast growth among customers and market. Due to this new plan of formal vehicles, it become popular not only among common customers but broadly requested by officers also. Now a day's Haval SUV becomes one of the most notable brands in the Chinese language office automobiles market for bulk purchase by administration departments of open fire fighting, streets and expressway governance.

However in china, there are a few limitation on car possession in some part of places, as part of minimizing traffic congestion and damages. Somewhat, the legal limitations and taxes increase influences the sales and revenue of great wall membrane motors.

(http://sites. cdnis. edu. hk/students/100106/2011/03/31/pest-analysis/)

e. environmental(green): green issues, pollution, waste

Environmental factors have increased role in vehicle industry as they cause severe hazards to living animals by polluting of the environment. To remove these harmful risks and achieving fuel efficiency in their vehicles, Great wall membrane motors introduced technological innovations in diesel engines like turbo charging and emissions technology. In order that they succeeded to accomplish thin emission with attractive fuel market and better vitality output(Anonymous, 2011).

They are also aiming to implement inexperienced diesel technology in their vehicles. With this technology in vehicles, great wall membrane motors are requiring an eco-friendly environment with energy saving performance. By this technology, the chairman of the company is convinced that, they created a discovery in high-efficiency vehicles with energy preservation power(CHINA: Bosch cooperates with Great Wall membrane Motors for inexperienced diesel technology exhibition, 2012).

f. legal: health& safeness regulations

Great wall structure motors give more importance for health & basic safety of the customers. For the they unveiled advanced all wheel driving technology in their vehicles(Anonymous, 2011).

2. Porters five force analysis

Porters five make theory was developed by Michael E. Porter in 1979 for evaluating and figuring out the current talents and market positions of different business firms. The Pictorial representation of porters five push is shown in appendix 2 and the porters five causes research of great wall membrane motors is described the following

(Downey, J. (2007). Strategic examination tools. London: The Chartered Institute of Management Accountants)

a. risk of new entrants

This is one of the severe dangers confronted by great wall structure motors. There are many reasons for this hazard. As china is one of the growing economies, the marketplace demand for vehicles is continually increasing. Because of this, many new automobile companies want to walk carefully to the first stage of automobile life circuit. Then only they can endure in this industry in future developed phases. Furthermore the faint intellectual property laws allow new companies to duplicating the design as well as other properties of others. In order to develop new enhancements in efficient and effective manner than researching and development steps.

b. Bargaining ability of customers or customers

This electricity is also reasonably high for great wall membrane motors as there are so many vehicle manufacturers both in china and international markets other than great wall motors. In order that it's too difficult to hold up against in this market without utilizing any striking innovations.

c. Risk of substitutes

In China, Mass- transit could impact the automobile sales terribly. But today in this growing overall economy there can be found a vogue in china that, people considered car as their status symbol. So if anybody involves be financially stable then he ends up with buying an automobile rather than depending on cheapest settings like mass- transit or bicycles. Therefore the impact of substitutes doesn't results great wall basically.

(http://porters-5-forces. blogspot. com. au/2011/11/porters-five-forces-analysis-china. html)

3. Strategic capabilities

a) Three high strategies

To improve the products quality, Great wall structure motors made "three highs" strategies specifically powerful, high technology and high quality. In order that they are encouraged to use hi-tech innovations and better performing designs with their products so you can get excellent and effective quality products. While competing with other international leading brands, the "three high" strategies made them fit to keep a highly accelerated momentum in their sales. In the facet of "3 high" strategies they lately signed the strategic cooperation agreement numerous international companies like TRW, Valeo, Bosch, BorgWarner, Ricado, Mahle, Autoliv, and Brose in product production. The relationship of great wall structure motors with these international giants compelled those to upgrade their product quality by performing thorough research and development of systems.

b) Set up branding predicated on category

Great wall membrane motors is the china's 1st automobile company that established their brands with the category. Regarding with their view point, real brand could be the agent of distinguishing model in customer's head. Because of this category branding, they may be enjoying sturdy advantages including: For quite some time, their Haval SUV and wingle Pickup have been registered as No: 1 in sales market. Within the approaching years also GWM decided to focus on 3 main categories PC, SUV and Pickup plus they wants to be top most in the market with each of 3 brands in paramount positions with Haval- as china's best selling SUV brand, great wall structure Personal computer as china's leading PC brand and wingle -as china's best grab brand. With this 3 leading brand positions, the brand of Great wall structure motors strongly recognized.

(http://www. topgreatwall. com/great/page. php?lang=en&page_name=about)

c)capabilities:-

GWM continue to maintain a steady sustainable development in the auto market, due to its steady operation and concentrating strategy. They also followed a workout of valuing R&D within the company in order that they succeed in keeping up the quality of their products by upgrading technologies (Media). Recent data shared by NPCA (National passenger's cars association) demonstrates that GWM supports a visible position in top 10 sales list during the first 50 % of time 2012. When NPCA narrowed the list, GWM is the one self-employed brand which hold such the perfect position.

Recently, the workshop conducted by GWM's technology centre announced that comprehensive proving ground will be finished by end of 2013. GWM is very proud to own first total proving surface among Chinese self-employed automobile companies. Off their starting onwards GWM offers more concern for product quality. They constantly assured their product quality by product quality retaining systems. Because they give more value for product development and quality test, showing surface was one the major project of GWM's research & development centre. The effort of GWM on development of demonstrating floor illustrates the strategic thinking about management and professional operation of GWM.

d)STRENGTH

In 2011, Chinese language automobile market confronted a downturn because of different facets. When equate to the sales record of 2010, it shows a 30 %30 % fall in overall sales level. Moreover Chinese 3rd party brands tend to be brittle and their share acquired skid sharply. Even in such a dim market, GWM taken care of an excellent progress of their industry. Based on the chairman of GWM, a solid brand might be a innovator in their vicinity and may act as agent of its product kind in customer's head. GWM is the first car industry which released brands in their products types. To a large magnitude, branding their products helps GWM to boost their efficiency and to continue to be competitive in global market. Lately GWM's president distributed their magic formula behind success that concentrating on high-quality products rather than making poor and reasonably priced products. In addition in this year, they are preparing to give attention to the improvement of sales wall plug and terminal services. So they will concentrate on fixing customer's problems.

(Public website)

4. Internal environment

The value chain system is achieved to recognise the type of activities committed by the company for creating something or service. The primary activities will be the activities that the organization engages for creation and delivery of a product within the organization through various logistics and external activities include creation and sales. The supporting activities are activities that the organisation uses for polishing the efficiency and success of main activities. This analysis helps managers to understand the functional level of which the product goes through for growing value and this understanding is more superior in the success of all the businesses (Porter, 2012). This paper centred on various main and extra activities undertaken by great wall structure motors.

Value chain activities

Inbound logistics includes activities that concerned with getting, storing, and circulation of inputs necessary for making products. Great wall motors looked after to getting goods from suppliers all around the world to be able to increase their option of goods. Great wall structure motors uses a just with time approach for managing their goods. Just with time is an way of lowering in-process inventory and associated costs for improving the investment return on business. Procedure stage is the most difficult period as it will involve the experience of converting the recycleables received into a final product. Great wall motors are famous for their reliability for their efficient operations. Within this stage great wall membrane assembles all the materials needed for Individual functions including systematization of parts for an automobile and final tuning of car engine motor. In Outbound stage, great wall send out their finally refined vehicles to wholesalers, merchants, or to consumers. Great wall structure were able to maintain their showrooms in several countries for making their products easy to get at to customers.

The online marketing strategy that great wall membrane implemented was their primary lead for securing a dominant position in the auto industry. They preserved a customer oriented style in their business businesses and also they were able to meet their customers demand. Great wall membrane targeted more on marketing communication and promotion mixture in this area. Great wall structure got given more top priority for their customers. So in the area of services they focussed more on last checking, grievance handling, after-sales services and so forth.

(Formal website)

SWOT Analysis

Strengths

Strong distribution network in china

Succeeded in determining local market demand

Lower working budget rely upon economy scale, low priced of land and labor, cheap vegetable cost, and own creation of spare parts for its vehicles

Better repayment collection procedure encourages it with little credit debt.

Weaknesses

It is very much weak in its research & trends settings. It depends upon talented specialists from other custom made companies to develop designs because of their models. According to their record, their R&D expenditure accounts only a tiny ratio of its total sales.

Opportunities

Expansion of SUV sales causes an outstanding expansion for global vehicle market. China observed stable sales in SUV market during 2008-2011. Greatwall's low production cost floor and its own paramount position in SUV market allow them to attain a robust expansion in global vehicle market.

Its cost composition induces the demand of great wall's vehicles in global market. China's VAT rebate insurance plan allows great wall to enjoy the higher margin in exporting their products to international market.

Threats

Conclusion

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