Corporate strategy: the French automotive industry, example of Renault

Résumé du document

The French automotive industry is one of the best drivers of the country. Around 2.5 million people have a job directly or indirectly (energy, insurance, advertisement) linked to this activity and it represents 20% of the plus-value industry. This industry is divided into two parts: 66% concerning the construction of cars and 33% the production of equipment. The allocation of resources respects this proportion. Mass-producing is the base of automobile construction. With the diversification of the models, manufacturers have adopted a platform policy that pools the constructions of the elements that cannot see the client. It allows for the reduction of costs.

Extraits

[...] Corporate strategy: the French automotive industry, example of Renault 1. Describe the French automotive industry and its main features The French automotive industry is one of the best drivers of the country. Around 2.5 million people have a job directly or indirectly (energy, insurance, advertisement) linked to this activity and it represents 20% of the plus-value industry. This industry is shared in two parts: 66% concerning the construction of cars and 33% the production of equipment. And the allocation of resources respects this proportion. [...]

[...] So that is impossible for a new company to be created and to break into the market because the costs are too important. The number of French car export is rising year per year. Exports absorb 60% of automotive production. Today, automotive industry in France has some challenges to fight, linked with the crisis. Automotive production is traditionally sensible to the evolutions of the economic conjuncture. - Saturation of market: in 2008, there is a drop in the automotive production. Stocks of automobiles are too important too. To revival supply, French state commits itself, granting 6.5 billion euros in 2009. [...]

[...] Innovation is another capability of the group with always creating new models like Laguna, Megane or Clio. Things that Renault do better than its competitors is the security with more cars succeeding crash tests than some German luxury car brand. And also its ability to buy or make alliance with other brands like Dacia or Nissan and succeed with them selling of Logan since launch and Nissan cars (more than Renault) in 2008. - Determining the sources of competitive edge Renault group have 3 main competencies: Producing quality cars with euroncap high scores, more than some German luxury brand Creating new cars with 8 launches in 2009 making Renault range the youngest of Europe Success in extending its group brands (Success of Nissan and Dacia) making Renault Group 3rd in the World A global player : International presence of Renault group is being stronger every day in emergent market like Russia, South America, or India - Determining the attractiveness of the industry This industry is very attractive for Renault group because there are a lot of emergent market like South America, India, Russia or Asia and Renault group has the resources with employees, industrial sites, and local brands in these countries like Dacia, Avtovaz, Samsung and some big brand like Nissan and the competencies to succeed with the knowledge of making quality cars and the experience of international business with Romania, Morocco and the experience of management and alliance with other brands like Dacia or Nissan. [...]

[...] That's why, in of the new French cars are bottom-of-the-range. - Ecological constraints that take place in conception and use of automobiles Using the RBV framework, how do you appreciate the current strategy of Renault group? - Identifying its resources Financial resources of Renault group are a total sale of billion euros with a margin of 212 million euros. Renault group have sold cars in 118 countries through the world. Renault group own 4 brands, Renault, Dacia, Avtovaz (Lada) and Renault Samsung Motors and has an alliance with Nissan. [...]

[...] The French automotive industry has a good reputation on the world market. For the last 10 years, France has been ranked among the top European automotive manufactures. Moreover, in France, the expenditures for advertisement reached 1 billion euros in 2007 ( of the turnover). Advertisements are important, and contribute to the promotion and diffusion of the cars. Further, each company has its own garage to sell its cars, which is easier to be close to the client. There is 2 main French company which produce cars: Renault and Peugeot- Citroën. [...]