Global Business
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Introduction
This report will compare the USA with the peoples republic of china in terms of which is best for WorldComm a fictitious mobile media and Communication Company. The report will look at SWOT and PEST models as well as well as orgainsation strategy in order to come to a conclusion on which country is more suitable.
The main objective of this report is to find which country Audi would be most suited to expand into. The two countries that will be evaluated are America and China.
Company Profile
Audi are a German company who manufacture cars. They are one of the four biggest car manufacturing companies along with Mercedes Benz, BMW and VW. Audi was created and began its rise through the car industry in 1932 when four independent car manufacturers, who were Audi, DKW, Horch and Wanderer, merged and created Audi AG who we know today.
Audi claim to be manufacturers of beautiful and sophisticated that embody technological perfection. This can be seen by looking at Audi car models. They look good and also drive very well. Audi have built their cars on the values of creativity, commitment and enthusiasm. Audi want to be the best and the biggest car manufacturer in the world. Their slogan “Vorsprung durch Tecknik” which means advancement through technology shows that the company want to keep improving their cars till the point of absolute perfection which will lead them to the top of the industry and mean their goal has been achieved.
Sector Profile
China
In the past when people talked about car manufacturers the biggest names were USA, Germany and Japan but this will soon change. In the last year China overtook France to become the fourth largest car market and is rapidly growing. Soon China will become the third largest market taking over Germany.
China is has the largest population in the world with 1.3 billion people but the number of car owners is less than two in a thousand. This is because in China people use two wheeled vehicles rather that four wheels. But with rising income in China and the availability of car loans more and more people are now buying cars in China. In recent years the output of cars has increased and now a million cars are being produced every year in China.
The profits to be made in China are huge. In 2002 when overall sales across Europe declined by 7%, in China sales had increased by a significant 37%. Also with the wage rate in China not being high, the country is like a gold mine for companys who can make high profits as the profit margins in China are sky-high. In the last 10 years a lot of car manufacturers have moved into China and opened plants there. Ford announced that they would increase their investment in their Chinese plant by $1 billion. This announcement was made shortly after they moved into their $100 million plant. Other car manufacturers also announced similar expansion plans.
America is one of the two biggest