Globalization Drivers Essay

Globalization drivers Ultra extravagance gondola elevator railroad rail car application Luxury car application There argon four un alike(p) kinds of levels in the broad(prenominal) life car intentness. The levels destine the actors of the market into distinct levels depending on their spirit level of sumptuosity. We fetch chosen to focus on the highest level of highlife cars the ultra sumptuousness cars. The main players of this level be companies such(prenominal) as Ferrari, Mercedes-Benz and Porsche, but the level as fountainhead as includes the not as big companies as Cadillac, Aston Martin and Maserati 1.All these companies lay down in normal is that they argon international companies with a nonpartizan communication surrounded by the breaker point living quarters and the different desks scattered around the world. The head quarters develop and supplies the desks with main car models while the desks receives the customers preferences so they together ordur e produce custom make cars 2. section The companies in the Ultra Luxury Cars effort directs to a narrow group of damageumers, which belongs to the hurrying class or upper optic class each over the world. They argon all sharing al almost the aforementi angiotensin-converting enzymed(prenominal) main ask, which consists of status, speed and transportation.The customers achieve these needs by buying the ultra sumptuosity cars because they represent a truly high level of exclusivity, individuality and craftsmanship 3. Since the customers treat the kindred needs overall, it could be termed as Levitts (1983) convergence perspective. Where the needs of customers all over the world are turn more(prenominal) converged, which is typical for the market of luxury goods. Since the customers in the segment, which the ultra luxury car companies focus on, share overall the same needs and then they are situate all over the world, the industry considers a globalized market.Most compan ies that are involved in buying heavy machinery or different large leverages have high restore be and the go industry is no exception to this. However on that point are electrostatic differenes within the whole industry, for suit the demand and takings of a Porsche may not be as enormous as with Toyota for pil emit slip, which ingrainedly federal agency that a luxury cars contumacious bell per unit is higher than an mean(a) family cars. The rent of a pulverization and all the other(a) different expenses to foreclose the point of intersectionion running form the mulish costs.As the labour expenses for example are a pass on cheaper in Asia, most car companies, including the luxury ones, have migrated their production there. The pressure for globalisation is clear, but still there are some luxury car companies that have stayed loyal to manufacturing the cars in their country of origin, such as Aston Martin. (https//www. honk. com/aston-martin) bed curve Most lu xury auto companies have many decades of welcome in manufacturing their cars, which means both skilled expertness in technology as rise as grades of building a strong and distinguished mug.In luxury cars especially the signifi digestce of the grime is very important as many of the customers purchase these cars lonesome(prenominal) for the status symbol that they trust its owner. Building a solid brand usually takes years of work in exceeding the customers expectations, it demands strong- exited marketing, filling a particular niche at a right time. Sourcing Luxury automobile companies usually favour centralized purchasing which means that they buy the parts that they need from one location for all the locations within the organisation. This provides normalization of a product which is quite essential in luxury cars, as well as some cost-savings.Automakers universally outsource production of parts or sections of vehicles, and for example Porsche is known to use a Finnish co mpany, Valmet Automotive, to assemble its two main product lines, the Cayman and the Boxster. (http//www. exclusively-auto. com/ youthfuls/porsche-to-outsource-boxster-production-to-osnabrueck_id121470. aspx)Product development costs Because of the nature of the product, the development and research of new technologies can be quite costly within the automobile industry. Technological changes The live on decades the technical development for luxury automobiles has foregone very quickly.For example the first luxury automobiles were noted as luxury just by having seat heating or high beams. Nowadays luxury is more about buttons for technological equipments, voice command, give notice efficiency and safety for the car driver. With having this thoughts in aspect, you can considerate the technical changes in the luxury automobiles industry as a pressure for globalization. Of course there are still some exceptions, for example Rolls Royce that is having a more of a British onrush in their cars, with less buttons and simpler interior and equipment.These things can point against a more reparation approach. Favourable logistics The logistics for the luxury automobiles depends for how long blank space they have to be transported, so for the consumers it will be cheaper if they can find an automobile as close as possible. some other aspect is that depending from which country the automobile is import from you have to pay a different amount of taxes and insurance fees and nevertheless other regulations can appear. Therefore the companies will have an advantage if they are locally settled, even though the really rich clients wont care about the cost for the transports.Actually this may be why many automobile companies has started factories in Asia, though for example the German automobile companies had made a between 30-40 % sale ingathering in China. They may by this last not only gain first-class honours degree labour costs but in like manner lower transport costs. Country specific differences If you look at last years statistic for automobiles producing, low labour cost countries like China, Japan, South Korea and India is all in the top five, the other country in top five is Germany.This shows that many automobile brands have factories in these countries just for the low labour costs. In Germany the automobile industry is one of the biggest employers in the country, one reason out is that Germany have many famous car brands and they have a lot of experience in the country. Between the different luxury automobile brands it differ a lot from where they are produced, like Mercedes-Benz have factories in a lot of different countries, Ferrari is only produced in one city and like for example Aston Martin is only produced in cities in UK.Therefore you can say that there is different kind of localization and globalization approaches. Competitive globalisation driver The bordering driver concerns the competitive environment, eg the amount of challenger from other countries and continents as well as if there is any mutualness between countries. According to Yip (2003), globalised competitors and country interdependence are pressures for globalization. Globalised competitorsIn the luxury car industry, there are competitors from for example the US (Cadillac), Germany (BMW, Mercedes-Benz, Maybach, Audi), Italy (Maserati, Ferrari), Japan (Lexus, Acura) and England (Aston Martin, Rolls-Royce). According to Stonehouse et al (2004) a company that faces global competition has to repugn on global terms as well. Therefore these facts indicate that this specific industry has become or are adequate globalized since there, given the examples above, are competitors from Europe, Asia and North America.Interdependece of countries In todays economy and as a result of specialization, companies are concentrate on their core competences. For example, the German brand Mercedes are mainly focusing on instauration and design (Mercedes. com) while Acura have environmental friendly performance and innovation in the center of attention (acura. com). The headquarter of Mercedes is move in Stuttgart and the production is taking protrude in Germany, Japan, USA, France, England and