Marketing Plan for Launcing a New Car

Changes are made in the road tax system; the number of tax bands will increase from 7% to 13% with higher penalties according to the emission level (Parker, 2009). Possible elections of Conservative party could see changes, such as withdrawal of scrappage scheme which has since its introduction seen a total of ‘367,929 cars (increase of 11. 3% on previous year prior to scheme) sold’ (Wearden, 2009). Due to this scheme being introduced, the year-on-year registrations for new cars were up ‘11. 7 per cent for the month of September 2009’ (Williams, 2009).

Figures show that ‘78,339 cars were registered through the scrap page scheme in September alone, bringing the total year-to-date figure of scrap page-registered cars to 181,117, showing just how popular the initiative has been with consumers, who have taken advantage of a ? 2,000 discount offered on many new vehicles to trade old models in. There are also plans in place to inject a further ? 100m into an extended lifespan into 2010 by the government due to its success. This has stimulated sales and possibly saved tens of thousands of jobs’ (Wearden, 2009).

| Economical| Until the 3rd quarter of 2008, the British economy had a positive growth rate but at a slower pace. However, UK’s business cycle is at the stage of recession now as it had a ‘negative growth rate for more than two consecutive quarters starting from q4 2008’ (ONS, 2009). Consumer expenditure on personal transportation has solely shown an increase year after year and summed up to ? 39,895 million, ? 656. 42 per capita, in 2008 (Hogeschool van Amsterdam). Appendix 1 presents two tables with all the relevant indicators.

Most of the cars are purchased using a loan, hence that if the interest rate goes up; a decline in sales is to follow as taking a loan becomes less attractive (ONS, 2009). One prospective forecast though, is that the interest rate is expected to remain around 0. 5% until recovery is commencing although the oil prices are rocking sky high which makes it more expensive to both produce and use the car (ONS, 2009). In 2008, the unemployment rate was 5. 7% of the economically active population and has increased to 7. 9% between past May to July which

indicates that there are more people available at higher qualifications to do the job, but at the same time, production levels in the UK are cut (HRM Guide, 2009). This fall in car manufacturing can also be traced back to the steel producing firm Corus who announced to cut 3,500 jobs of which 2,500 in the UK at the beginning of this year. Steel prices had seen a rapid rise worldwide, before the recession. The sudden decline in current recession prices, evident in Table 1, could enable Primo to purchase necessary steel for production at lower costs than previously, saving on costs.