BRILLIANCE AUTO: CASE STUDY

Brilliance Auto: Case Study



Brilliance Auto: Case Study

Introduction

Chinese vehicle manufacturer Brilliance Auto has said that it intends to double its annual revenue within three years. By 2010, the company expects to roll-out 500,000 vehicles, compared to an estimated sale of 300,000 vehicles for 2007 which is expected to generate CNY40 billion. In the first half of 2007, the company has sold more than 146,000 vehicles, a 59% increase from 2006, due to which the company's sales rose 55% to CNY22.1 billion. In a joint venture deal with BMW in China to sell 158,000 sedans in Europe over the next five years, Brilliance Auto said the recent poor test crash test results of the BS6 will not have any impact on its sales arrangements in the continent. Brilliance China Automotive Holdings, Ltd., a China-based manufacturer of automobiles, is planning to form an auto finance joint venture with Bayerische Motoren Werke AG (BMW), a German manufacturer and seller of cars and motorcycles. The auto finance arm would service the Brilliance Auto-BMW joint venture. Freshfields Bruckhaus Deringer LLP is acting as legal advisor to BMW.

Brilliance Auto is a rising star in the local brands of China automotive industry. Since its birth, Brilliance Auto always adhered to the concept of 'Build own brand from high starting points' and unique development mode of the 'the combination of the capital market and automobile industry.' This opened up a new way for the development of middle-high-class brand in China. However, the 'high starting point' development model brought various difficulties to Brilliance Auto.

Three large companies and three small companies are basic joint venture companies. Their main products are B class and C class cars which market share is 71.8%, so they produced the A0 and AOO class cars in order to get more market share in the domestic market. Through analysis of joint venture companies which improve their market share in the native automobile market. Independent corporations will meet the bigger and bigger problems, so they need to adjust their product strategy.

Ans1- PESTLE Analysis of Germany

Scents of Time

Coty

Political

The government has undertaken a revamp of financial sector regulation with the passing of the insolvency law in November 2010 that provides systemically important banks with a method to tackle insolvency.

Angela Merkel's CDU lost its traditional stronghold of Baden-Württemberg to the Greens in March 2011. On the other hand, its coalition partner the FDP is undergoing power struggles within the party.

The CDU's defeat and the FDP's internal squabbles could seriously affect the future prospects of the centre-right coalition.

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Environmental

Germany's CO2 emissions were 818.0 million tons in 2010, down from 822.6 million tons in 2009.

This meant that the CO2 emissions contracted by 0.6% in 2010 compared to the previous year.

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Economic

The German economy contracted by 4.7% in 2009. However, it rebounded with a growth of 3.4% in 2010. Germany's budget deficit reached 2.7% of GDP in 2009, with government revenue falling significantly by ...