Motor Vehicle Manufacturers

April 9, 2007

Other than cost cutting, major motor vehicle makers are using strategies such as non-price, product development, market development, and product proliferation.

General Motors is pursuing all these strategies. In product development, it tries to make new types of trucks and combinations of vehicle types, as well as sports and specialty cars. It is making a new type of diesel and a new type of hybrid. It tried to make safer vehicles. It has bought smaller car companies to sell their products, such as in Europe, China, and Korea. In market development, it emphasizes America and working people in its advertisements. It tries to open markets in Europe, China, and Korea. It tries to emphasize its hybrid technology and safety technology. It wants to partner with other companies. It had a policy letting customers pay what employees pay. In product proliferation, it makes many types of vehicles to match whatever other companies make. It buys companies to have more products of different types. It makes new categories of cars and trucks. It sells auto parts and auto loans and has many other businesses of different types.

Honda is pursuing some of these strategies. In product development, it tries to make new types of cars and trucks. It also sells motorcycles. It is making a new type of gas-electric hybrid. It tried to make its cars safer. It tries for reliability. In market development, it emphasizes gas mileage and reliability. It opens plants in other countries. In product proliferation, it makes cars with new technologies. It makes new types of motorbikes for smaller and poorer countries.

Toyota and most other companies are like Honda. They concentrate on the vehicle business and try to make better products.

Ford and European companies try to go into many different businesses and have many different businesses under them. They can be more diverse and try to get market share from pricing and discounts, so they can make money from loans and parts.