VW Company Analysis

VW Company Analysis

1.1 Industry Characteristics and trends
1.1.1 Definition of the market
Volkswagen AG. is a German automaker that operates in the global automotive industry as a manufacturer and distributor. Volkswagen of America is one of its subsidiaries that based in the United States. Volkswagen?s New Beetle is produced to target in the upper small car sector. The automotive industry is a consolidated industry as there are increasing number of joint ventures, takeovers and strategic alliances.

1.1.2 Market Size
In the U.S., there were 8,272,042 unit of cars sold in 1997, which that include small cars, middle cars, large cars and luxury cars. There are three different segments (lower small, upper small, and small specialty) within the small car sector, and there were total 2,217,148 units of small cars sold in the U.S in 1997; it represents 27% of the total car market. In the small car sector, VW occupied a 5.04% market share and sold 111,686 cars in 1997. (See appendix Table 1)

1.1.3 Market growth
The industry is in its mature stage of its life cycle as the sales and demand of those products are slowly decreasing and also experiencing increasing mergers and acquisitions. There were 3% drop in the

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