Volvo: Marketing Environment

Volvo: Marketing Environment

Our team’s studies from a macro-environmental perspective have brought us to the conclusion that while all six factors are direct influences on Volvo’s performance, the economic, natural and political environments are central to identifying Volvo’s performance in the automotive industry. The economic environment view, (consumer confidence in product throughout economic changes) and the natural environment insight (provides resource cost comparisons), in essence, determine Volvo’s viability in addition to its legal and political structures, which uphold its market value and profitability. The figure below demonstrates the team's opinion of which factors are most important to consider for Volvo.

Volvo’s key stakeholders:

*

* Customers

* Employees

* Car dealers

* Component suppliers

* Shareholders

* Politicians

* Natural environment

* Surrounding communities

Volvo’s major competitors:

*

* BMW

* Mercedes Benz

* Audi

* Acura

* Lexus

* Infinity

Volvo’s Macroenvironment

Natural Environment

Over the past few years, the cost of raw materials has increased significantly, mostly due to rising oil prices. Raw materials needed to produce a car include rubber, glass, steel, plastic, and aluminum. Steel is a key raw material in vehicle production. High steel price increases put pressure on manufacturers and reduces margins. The price of steel is expected to rise further in 2012, according to the Ibisworld industry report. In order to reduce raw materials cost Volvo relies on component suppliers who develop and manufacture different automotive parts. The bulk of the environmental impact of a car occurs while the car is in use. “In the United States, we now have more motor vehicles than licensed drivers, and we travel over 2 trillion miles per year, burning 120 billion gallons of gasoline. Not counting the "upstream" emissions from producing the fuel, the result is over a...