Abstract
http://www.nst.com.my/Current_News/NST/Thursday/National/2308174/Article
The article titled '16pc fall in motor sales expected' (Hamid H. and Ismail Z.I. 2008) cites rising fuel prices, inflation and stricter vetting by finance companies on hire purchase loan applications as among the factors contributing to the slowdown of the Malaysian automobile market in the second half of the 2008.
The first part of this essay is antecedent in that it provides a treatment on the Malaysian automobile market. The key topics covered here are the market history, market segments, market performance, market players, market structure and the behaviors of competing firms. The second part of this essay rationalizes the effects of the factors specified in the article, and goes beyond to identify other factors that are relevant to the eventuation of the industry. This final part of this essay recapitulates the forces that drive, restrain, threaten or provide opportunity for the industry by way of the SWOT principle, and concludes with recommendations on how firms may compete in light of these forces. (Total word count = 5089)
1. Market Overview
1. Market History
The auto industry is deemed the ‘industry of industries’ of the twentieth century due to its scale and spin off effects (Dicken P. 1998). The strategy to form a national auto industry in developing countries has to follow to some extent a particular sequence of national auto industrial development stages listed below (adapted after Dicken P. 1998, p.318).
1. Stage 1: Import of vehicles in the CBU (Completely Built Up) form by local distributors.
1. Stage 2: Assembly of semi or fully CKD (Completely Knocked Down) vehicles by subsidiaries and licensed/franchised domestic ...