Discussing the abillities of VW to be sucessfull in the US by either producing their or importing from other subsidies.
Table of Contents
2. INFORMATION ABOUT THE COMPANY – INTERNAL FACTORS
2.1 CORPORATE GOALS AND OBJECTIVES
2.2 CORPORATE STRENGTHS AND WEAKNESSES
4. INFORMATION ABOUT THE TARGET COUNTRY – EXTERNAL FACTORS
4.1 TARGET COUNTRY MARKET FACTORS
4.2 TARGET COUNTRY ENVIRONMENTAL FACTORS
4.2.1 Political Environment
4.2.2 Economic Environment
4.2.3 Socio-Cultural Environment
4.3 TARGET COUNTRY PRODUCTION FACTORS
5. DESCRIPTION OF THE OPERATION MODES
5.1 JOINT VENTURE (JV)
5.2 WHOLLY OWNED SUBSIDIARIES (WOS)
5.2.1 Acquisition
5.2.2 Greenfield
6. ANALYSIS OF THE SUITABILITY OF THE OPERATION MODES
6.1 JOINT VENTURE (JV)
6.2 WHOLLY OWNED SUBSIDIARIES (WOS)
6.2.1 Acquisition
6.2.2 Greenfield
7. CONCLUSION
Objectives and Research Focus
This assignment aims to analyze the strategic market entry of Volkswagen AG into the United States, specifically examining the transition from a niche player to a significant market competitor through the establishment of a local manufacturing facility in Chattanooga, Tennessee. The study evaluates various international business operation modes to determine the most effective approach for Volkswagen's expansion in the US automotive market.
- Analysis of internal corporate factors and objectives of Volkswagen.
- Assessment of the external environment and market conditions in the US.
- Evaluation of Joint Ventures (JV) versus Wholly Owned Subsidiaries (WOS).
- Comparison of acquisition strategies and greenfield investments.
Excerpt from the Book
5.2.1. Acquisition
Although it is the fastest mode, finding the right company is difficult and integrating different management styles and cultures may cause problems. Buying existing assets makes market access easier through using established structures and well-known brands and hence calculating with an existing market failure risk.
A main problem is to keep the existing staff with key knowledge and to find a company which culture suits the own. Unexpected costs can lead to expensive and unsatisfying acquisitions.
Summary of Chapters
2. INFORMATION ABOUT THE COMPANY – INTERNAL FACTORS: This chapter covers Volkswagen's corporate goals, such as tripling US sales by 2018, and outlines the company's competitive strengths and weaknesses within the American market.
4. INFORMATION ABOUT THE TARGET COUNTRY – EXTERNAL FACTORS: This section provides an in-depth look at the US market, examining political, economic, and socio-cultural drivers, as well as production-related factors like labor and infrastructure.
5. DESCRIPTION OF THE OPERATION MODES: This chapter defines the theoretical framework for international business entry, specifically focusing on Joint Ventures and Wholly Owned Subsidiaries (Acquisition vs. Greenfield).
6. ANALYSIS OF THE SUITABILITY OF THE OPERATION MODES: This chapter critically applies the entry mode theories to Volkswagen's specific situation, weighing the risks and benefits of various strategies in the context of the current economic climate.
7. CONCLUSION: This final section summarizes the strategic recommendation, concluding that a greenfield investment is the most suitable approach to secure long-term market growth and operational control.
Keywords
Volkswagen, US-market, International Business, Operation Modes, Greenfield Investment, Acquisition, Joint Venture, Automotive Industry, Chattanooga, Strategic Management, Market Entry, FDI, Economic Crisis, Production Strategy, Competitiveness.
Frequently Asked Questions
What is the core subject of this paper?
The paper examines Volkswagen AG's strategic decision to expand its manufacturing and market presence in the United States, specifically focusing on the new plant in Chattanooga.
What are the primary topics covered?
Key topics include internal company goals, US market environmental factors (political, economic, social), and the comparative analysis of different foreign operation modes.
What is the primary research goal?
The research aims to determine the most suitable international business operation mode for Volkswagen to effectively enter and grow within the highly competitive US automotive market.
Which research methodology is applied?
The study utilizes a qualitative analytical approach, comparing market entry theories such as Joint Ventures, Acquisitions, and Greenfield investments against Volkswagen's specific strategic needs and resources.
What is discussed in the main body of the text?
The main body details Volkswagen's corporate strategy, evaluates the US business environment, defines entry modes, and analyzes their feasibility for Volkswagen, including the risks and benefits of each.
How would you characterize the work using keywords?
The work is characterized by terms such as market entry, Greenfield investment, US-market, FDI, and strategic management in the automotive sector.
Why is the Chattanooga project considered a "new-market entry"?
Volkswagen has historically maintained a low market share in the US; building a dedicated manufacturing center to produce customized models represents a transition from a niche importer to a local producer.
What role does the current economic crisis play in the analysis?
The crisis is viewed as both a challenge (financial risks) and an opportunity (availability of qualified labor and potential for cost-effective market expansion).
- Citation du texte
- Oliver Gätgens (Auteur), 2009, Volkswagen - production strategies for the US market, Munich, GRIN Verlag, https://www.grin.com/document/174928
