Question

You work for Renault, the French auto manufacturer, and your job is to put together a strategy for marketing Renault cars in the U.S. You have the opportunity to keep the product line the way it is or to change it completely. Discuss the major environmental challenges: Economic, Cultural and Social, Political and Legal, Demographic, Competitive (mainly a short Environmental Scan) … that your company will encounter as they enter the US market.

Answer 1

The product line- changing product line would be the safe option as the American automobile market is being owned by big names like General Motors, Ford, etc.

challenges which can be faced by Renault motors-

ECONOMIC CHALLENGES - Renault to establish its assembly line has to acquire a favorable area for its business which requires huge cost and insurance so the company has to either go for debt market for loans or for equity market which also poses a challenge to the company. There is financial uncertainty, risk involves to survive in the U.S market.

CULTURAL AND SOCIAL - the American market is full of cultural uncertainty in the sense there are automobile makers who are there long before G.M motors, afford, Chrysler they engrave a sense to loyalty belongingness in them which affect the core human value conscience. as a car can be seen as the symbol of status in the society driving a brand that is well known by the people of America influnces a person buying behavior. to be successful Renault has to work at the ground level in making people aware of the brand which can help in gaining some liking in customers.

POLITICAL - this front will look after the recent political changes which are made in the country as there are WTO laws also the treaty like NAFTA which are ongoing with the foreign nations the interest rate and the unemployment rate of the country have to look upon.there central bank policy government decision regarding the establishment of a new plant etc.

LEGAL- These challenges are connected to laws that prevail in the country which are labor laws, environmental laws like clean air act. company has to review all the laws of the country before hiring or establishing a plant in America. also, litigation costs that are involved have to consider beforehand . all the legal compliance and the cost involves possess a challenge.

DEMOGRAPHIC - this challenge can be understood by the company by comparing the market size of the people who actually are in the legal age of the driving also composition affordability of the target population. different region profile also the demographic change forecast has to be considered as the plant which has to be made has to access the demand of the market without knowing the target customer possesses a challenge.

COMPETITIVE - the most important challenge is accessing the competition faces by the company by big three   G.M motors, afford, Chrysler these companies share a large percentage of sales and one of the biggest in the world they have a large product line with the different segments in cars they produce almost everything from luxury to middle man cars to the truck. to get the beforehand in the market Renault nut has to know about there grey areas. so that it can make a product that is different and unique from others.

STRATEGY - The strategy lines in accessing all the challenges which are discussed and forming a market research plan by analyzing the current automobile market trend. the first step can be assessing the demographic profile of the population of these income structures and needs which is there among them. it can be going for small medium-sized and marketing as the product of the middle-class population once it establishes loyalty in the middle-income group keep on working on a new differentiated model with the different product line. the most important part of the strategy is keeping the price low and quality high In the initial stage which can bring some losses once the company acquires the market base go for different cars with an increased price. forming loyalty should be a foremost concern as to survive  with the competitors