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Volkswagen which is shortly referred to as VW is a motor vehicle manufacturer that has its origin in Germany founded in the year 1937. The organization had been founded by the German labour front which had also been noted by the name of Iconic Beetle with its headquarter being in Wolfsburg. The flagship brand of the group is known by the name Volkswagen Group. The brand has been accounted for being the largest maker of car as per the worldwide sales of the organization in the year 2016 and 2017 is considered. Our team includes of 3000+ prolific assignment help experts who are well-experienced and have delivered numerous impeccable SWOT and PESTLE analysis of Volkswagen till date.
Background
Volkswagen as a car manufacturing brand had directed its concern towards designing, manufacturing and distributing passengers as well as commercial vehicles along with motorcycles, engines and other connected services to automobile sector like the ones of financing, fleet management and leasing.
The organization is an innovation driven one and as such they launch new models frequently in order to keep up with the changing preferences of the market and the customers. The organization has exhibited excellent adaptation in order to meet the local requirements of the market where they had been operating. The focus of VW had been on features that are specific as well as unique to the countries where they had been operating. The emphasize of VW is on the demand for the quality while they strive in order to offer attractive as well as environmentally sound and safe vehicle which would allow them to compete in the market that had been increasingly tough and thereby set a standard in the global market.
As per the revenue of Volkswagen in the ending quarter of 2020 is considered, the revenue is accounting for $60.736B which had resulted in a decline over 10.89%. We can help you perfect your Volkswagen case study SWOT analysis.
Brand portfolio of VW includes other automobile manufacturer brands like the Porsche, Ducati, Bentley and Audi. With an extensive portfolio it becomes effective for the brand to cater to segments with multiple buyers in that segment.
The manufacturing capacity of VW is also another source of strength for the organization which owns about 118 production plants all across the globe. In the year 2020 the production of VW included about 8.9 million vehicles.
Research and development is also another source of strength for Volkswagen as it turns over its competitors in the spending that it makes in Research and development. The year 2020 experienced a spending of about $16.5 billion in research and development.
The advancement of technology and IT had been utilised effectively by the organization in order to bring about efficiency in its process and production. The Car. Software organization has been developing an operating system for the vehicles. The software company has also partnered with Microsoft in order to develop a driving platform that is cloud based and Automated.
The organization had also developed a deadline of the year 2020 for launching its project under the name trinity under which it seeks to produce an electric sedan. The organization is aiming at making a benchmark in terms of the ways sustaining in the market where there has been increasing changes in terms of electronic cars.
Toyota had been able to edge out Volkswagen from its former position with its increasing sales where it outshined the revenue earned by VW in the year 2020.
There has been an attempt at VW to cut down the job position at it firms based in Germany either through early or through partial retirement period. The job cut is likely to cost about $598 million. The organization had also been faced with a faulty publicity stunt. The stunt had been looked mostly as an irresponsible act.
The structure of the management had been another area of weakness at the disposition of the organization where the CEO had been subjected to the resistance from the union workers due to his effort for modernizing Volkswagen
The opportunities of the organization lie in the ability of the organization to take up to the market of Electric vehicle. The organization has plans to start factories where it would begin with the production of batteries to run its electric vehicle
Self-driving technology is another area of concern in the disposition of VW. It had invested about $2.6 billion in Argo al where a start-up had been developing technology for self-driving. Bi directional charging allows the cars to use the unused charge to power home.
The recent pandemic under the impact of COVID 19 had affected the operation of VW. With the global pandemic in its affect the group under VW accounted for a decrease of about 15.2%. There had also been a decline in the number of units sold.
The market valuation of VW had been on a decline where the value of Volkswagen is $35.08 per share as compared to $677.02 per share of Tesla.
| Political | The major market for VW groups is market of UK and USA. However, the trade tariffs and related uncertainties in terms of the business relation with Germany can cause serious source of concern For a considerable period of time US has expressed its willingness to impose tariffs on the goods that have been imported from European union |
| Economical | There has been a sudden growth in the spending of the customers. Across all the corners of the globe there had been an increasing willingness of the customers to purchase consumer goods to an extent greater than the earlier times. In the poorer market the increase in the sales of the automobile is significant in particular due to the fact that in this market the customers have previously purchased no vehicles. In wealthier markets the increase in the spending of the customer is still beneficial as the customers have to choose from more expensive models and purchase extra than they require. |
| Social | The various groups under VW had been perceived well by the customers, many brands of VW comes with a quotient of being both affordable as well as expensive where the struggle is between the innovative competitors like tesla and BMW There has been a shift of the customers away from driving. The growth in the customer spending is not equivalent to the increasing intensity of driving. Rather people are willing to give up their ownership on cars in order to shift into bicycle. |
| Technological | Self-driving cars have gained their prominence in the market. Automotive manufacturers have been making greater efforts in order to develop vehicles on their own that are self-driving. Such a development comes with challenges both in terms of hardware technology as well as in terms of software. Another challenge that has been developing in the automotive manufacturing industry in the contemporary time beside the challenges of bringing about driving functionalities is to develop vehicles that are eco friendly as well as efficient. VW has already shown its ability to develop electric cars powered by batteries. |
| Legal | There has been a case that had involved VW in emission scandle where it had been claimed by United States Environmental Protection Agency in the year 2015 that VW had purposefully cheated the test for diesel engine emission. |
| Environmental | Concern for green technology is another developing source of concern that has been dominating the scenario of automotive production to a great extent. The trend has been to find alternative to traditional automobile that is green and eco friendly in nature. The consumers and the government both are concerned with the environment. Automobiles had been a great source of pollution but it had been made evident that in near future changes can be made within the VW group in order to remain relevant |
Recommendation
The scenario of automotive industry had been subjected to changes. Changes in terms of customer preferences as well as in terms of changes in concern towards environment. The case of Volkswagen has elucidated the ways in which the organization has declined in terms of its market share whereby its competitors have moved ahead.
In order to sustain in the market, it can be suggested that the organization needs to introduce newer model and innovative technology in order to get to the desired number of sales and place itself at a preferrable position. Place a request for Volkswagen case study help at Tophomeworkhelper.com, and get the most insightful SWOT & PESTLE analysis of Volkswagen from the assignment experts.
Conclusion
The market of automotive has changed to a greater extent whereby the concern towards environment and increasing pollution has been shaping the trends of development in this market. It is thereby not enough for the brands just to remain innovative in terms of technology and design but it also requires to exhibit its concern towards environment. The operation in the market of US and UK subjects VW to the imposition of tariff rates in terms of their imports which VW requires to bring under its concern.
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