Shanghai Volkswagen

COMPETENCIES SVW’s Core competencies :  Has good joint venture with VWAG with their tech  Produce the simple technology car  SVW’s distinctive competencies :  Has good local government connection

EFAS(1) External FactorsOpportunities • The Big Chinese Market • The premium car demand is increased • Growth of Chinese GDP Threats • New competitors • China’s WTO Entry • Immitability of the technology because of technology transfer

(2) Weight

(3) Rating

(4) Weighted Score1 0.3 0,8

0,20 0,10 0,20

5 3 4

0,20 0,10 0,20

5 3 4

1 0,3 0,8

Total

1.00

4.2

IFAS(1) Internal FactorsStrengths • The technology grow VW AG as market leader in Germany • Good local government connection • Good distribution centre • SAIC has became number 1 as automakers in China Weakness • AG doesn’t have control over sales marketing in Shanghai • Only sell the low-tech car

(2) Weight

(3) Rating

(4) Weighted Score0,4 1 0,15 0,45

0,10 0,20 0,05 0,15

4 5 3 3

0,25 0,25

5 4

1.25 1

Total

1.00

4.25

Current situation SVW has the “export-strategy” with joint ventures  

masked on 3 ways to gain comp. advantage 1. locating activity among nations in ways that lower cost or achieve greater prod. Differentiation 2. efficient/effective transfer of competitively valuable competencies & capabilities from competitor operations 3. coordinating dispersed activities in ways a domestic

SVW should do Being slow to mount a defense against stiffening     competitive pressures Concentrating on short term profits rather than strengthening long-term competitiveness Being slow to respond to price cutting Having too much excess capacity Overspend on marketing Failing to aggressively pursue cost reduction

Alternatives Revise existing strategy Launch efforts to boost revenues  Cut cost

NEW BUSINESS MODEL FOR SVWKEY PARTNER SAIC VW GOVERNME NT ADV AGENCY KEY ACT MARKETING ACTIVE SALES VALUE PROPORTION SOPHISTICATED TECH USER FRIENDLY LOW PRICE CUSTOMER RELATIONSHIP MARKETING EXHIBITION PROMO AFTER SALES CHANNEL SHOWROOM CUSTOMER SEGMENT PRIVATE CAR USER (EXHIBIT 8)

KEY RESOURCES R&D DIVISION SALES FORCE COST STRUCTURE MARKETING EXPENSE ASSEMBLY PLANT STAFF SALARY R&D DISTRIBUTION CENTER REVENUE SALES PARTNERSHIP