Strategic Management: A Competitive Advantage Approach, Concepts and Cases, 16/e

Competitors

Competition in the automobile manufacturing business is intense among Ford, GM, Toyota, BMW, Honda, Volkswagen, Hyundai-Kia, Nissan, Mercedes, and several other firms. About 75 percent of all revenue goes to purchase raw materials, so the industry is affected substantially by prices of steel, rubber, aluminum, and other raw materials. Wages, the second-largest expense, historically have been about $70,000 per employee in the United States and account for 5 percent of total revenue expenses. Higher commodity prices and wage expenses forced GM and Chrysler into Chapter 11 bankruptcies toward the end of the economic recession. However, labor expenses were reduced after labor unions agreed to concessions.

Competition among competing models ...