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Holden Pest Analysis

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GM Holden has announced that it is going to cease production of cars in Australia in 2017 leaving a detrimental effect on employment of its 2900 workers and negative impact on industry supplying Holden with vehicle parts and components which is going to affect 45,000 employees throughout Australia. Nowadays, the competitive character of business environment is the most crucial in survival of an industry. The business environment is influenced by various factors which are present at multi and cross-cultural level, transactional level and factors present in across the border business politics. The particular business can deal with the complexity of the environment by classification of general environment into individual sectors which allows …show more content…

once a year) as well as from continuous scanning which is also known as continuous learning providing continuous data collection and analysing of data considering broad spectrum of environmental factors (Kazmi, 2008). Political factors In the past Holden Motor Group was getting financial help from government in order to boost the economy overall and promote the company's valuable stance in the market place. However, the government believes that Holden was not proactive enough to ensure sustainability and refused to promote more funds towards the business because government funded Holden with 2.18 billion dollars during 2001 to 2012 while Holden annual sales reached 0.18 billions and by multiplying this figure by 12 years the result will be 2.16 billions what basically means that government (actually tax payers) paid Holden to produce the cars. Moreover the imposed carbon tax would be the other factor why Holden should reconsider the business strategy and start inclination towards more effective and ecological cars. However the company was ignorant towards changing the strategy towards greener production by developing large engines to keep the “iconic brand Holden” on top with strong and sporty vehicles. The appropriate environmental scanning would show high inclination and demand for economical and environmentally …show more content…

Taking into consideration the exchange rates linked with export costs and interest rates and taxes influencing import costs, the scanning could have alerted Holden company about unfavourable growth of Australian dollar which negatively influences export competitiveness. Moreover, scanning would reveal the tendency of factory workers' wages which are not going to decrease, import tariffs applicable to Australia were not going to increase and finally Free Trade Agreements are still strongly supported. These factors known as restrictions on market access (especially tariffs) which allow automotive manufacturing industries to enter Australian market at low cost or zero costs particularly for vehicles imported from US, Thailand and Malaysia, and negotiations with China, Japan, Korea and India should have led Holden to concentrate on more competitive production of the vehicles comparable with those imported ones. The business cycle has come to the point of recession called the recovery period. By all means the customers face the difficulty within purchasing habits. The customers concentrate to purchase only economical products and products of high

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