1. Lukas Dziadek
Lina Mao
Sakinah B
Mohd Shukri
Tenghan Xie
SKODA AUTO EXPANDS
TO INDONESIA

2. SKODA AUTO
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Skoda auto is automotive manufacturer

Origin in Czech Republic

Founded more than 100 years ago

On of the biggest national employer

Produce around 10% of country export

Owned by Volkswagen AG

Presenting on more than 80 markets

3. OWNERSHIP STRUCTURE
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
ANMARKET
ALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

4. SWOT ANALYSIS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
• Part of VW - good image
• Missing models of large MPVs and SUVs
• Positioning is not limited by VW
• In some markets perception of brand image
• The symbol of European quality
• Adapting production with customers
is poor
• Financial performance
Strenghts
Weaknesses
Opportunities
Threats
• Extension of existing capacity
• Crisis
• Growing market dynamics in ER
• Decline in demand - too much competitors
• Extending the sales network
• Changing trends - production of EV
• Extending the product portfolio
• Strong competition in the market
• Addressing other target groups

5. GROWTH STRATEGY
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

6. PRODUCT PROFILE
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Skoda Superb

Skoda Octavia

Skoda Yeti

Skoda Roomster

Skoda Rapid

Skoda Fabia

Skoda Citigo

7. FINANCIAL ANALYSIS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Unit
Year
2011
2010
Change
(%)
Production
ths. cars
902
780
+15.5
Sales
ths. cars
690
585
+18.1
26,565 24,714
+7.5
Employees
Sales revenues
mil. EUR
10,266
8,692
+18.1
Operating profit
mil. EUR
743
447
+66.1
Operating profit as % of revenues
%
+7.2
+5.1
Profit for the year
mil. EUR
652
349
+86.9
Investment (in fix assets)
mil. EUR
568
403
+40.8
Net liquidity
mil. EUR
1,838
1,605
+14.5

8. INTERNATIONAL INVOLVEMENT
INTRODUCTION
COMPANY
SITUATION
ANALYSIS

GLOBAL
MARKET
SEARCH

IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS



Africa – 10 countries
America – 14 countries
Asia – 29 countries
Europa – 39 countries
Oceania – 4 countries

9. MAJOR COMPETITORS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Volkswagen

Peugeot

Renault

10. INDUSTRY ANALYSIS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

World economic situation dominated by debt crisis

Highly volatile financial markets

Strong exchange rate fluctuation

High raw material prices

11. PORTER´S 5 FORCES ANALYSIS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

12. RECOMMENDATION AND
CONCLUSION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Automotive industry is in good growing up phase so it’s
time to expansion

Skoda is part of Volkswagen group, which has strong
basement

Negative influence of EU financial crisis in contrast of
growth of emerging economies

Expansion is strategic decision, which can help to company
to reach sustainable growth

13. SELECTING
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
The Process of Selecting Potential Countries
1.
Depending on the economic and demographic location
2.
Selecting the criteria that is relevant in the automobile
industry
3.
Evaluation of different countries
4.
Verification on the best market to penetrate

14. THE TEN POTENTIAL
COUNTRIES
INTRODUCTION
Huge population
Increasing economy
Easy access to manufacturing factories
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Angola

Argentina

Bolivia
 population--248.20 million

Egypt
 its growth rate -- 4%

Indonesia
 GDP’s rapid growth

Iran
 infrastructure

Mexico
 over 764,000 cars are sold in 2010

COMPANY
SITUATION
ANALYSIS
Philippines

South Korea

Vietnam
 competition especially Japanese carmakers
 rapid economic development
 large population
 many auto manufacturers
 great potential market

15. KEY CRITERIA
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
Demographics
GLOBAL
MARKET
SEARCH
Population( Growth Rate)
IN-DEPTH
MARKET
ANALYSIS
Local Consumption/Use
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Household income
Consumption of the product
Imports of your product
Economic Criteria
GDP
Disposable Income
Political/Legal Environment
Competition intensity
Tariffs/duties

16. RECOMMENDATION AND
CONCLUSION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Indonesia and Mexico is the most potential market for
Skoda Auto to choose from. Further analysis is now needed
to select which country we should entry into.

17. POTENTIAL CONTACT
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Mexico:
Indonesia:

Volkswagen De Mexico

Volkswagen Indonesia

Czech Republic Embassy

Czech Republic Embassy

Automotriz Naucalpan

Yassa Mobil

18. MARKET AND COMPANY SALES
POTENTIAL
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Based Total Skoda Market Potential
Indonesia
TMP (billions)

Mexico
186.1
242.2
Skoda Company sales potential
Indonesia
CSP (billions)
Mexico
14.8
19.2

19. POTENTIAL BUYER (1)
INTRODUCTION
COMPANY
SITUATION
ANALYSIS

SKODA is an automotive industry business focusing
on cars.
GLOBAL
MARKET
SEARCH

Based on this, there potential customer are more
towards that are qualified to buy a car, teenager
ranging 18-25 and are employed that can afford to
buy a car.
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Country
Indonesia
Mexico
Percentage
Percentage of people
Population of each
who employed in
country aged between
each country
15-64
55.4%
72.6%
75.6%
71.8%
Household
income
percentage
29.9%
41.4%

20. POTENTIAL BUYER (2)
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS

Skoda potential buyer within cities
City
Population
INDONESIA
Jakarta
9.121 million
Surabaya
2.509 million
Bandung
2.412million
MEXICO
ENTRY
STRATEGY AND
MARKET PLAN
Mexico City
19.319 million
Guadalajara
4.338 million
CONCLUSIONS
Monterey
3.838million

21. COMPETITIVE ANALYSIS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Competitor 1
Competitor 2
INDONESIA
Competitor name
Product name
Number of employees
Years in Business
Competitor name
Product name
Number of Employees
Years in business
Toyota
Innova
Fortuner
Avanza
5792
43
Nissan
Leaf
Tiida
Sentra
Tsuru
169298
79
Daihatsu
Xenia
Sirion
Luxio
7967
9
MEXICO
General Motor
Chevrolet Aveo
Chevrolet Spark
Chevrolet Chevy
Chevrolet Cruze
202000
104

22. COUNTRY ENTRY REGULATION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Import Regulation:

Indonesia administrative
barrier is lower than
Mexico

Import Licensing
requirement is more strict
than Mexico

Foreign Direct Investment:

FDI 100% Equity
ownership is more
encourage by the gov in
Indonesia

The gov are more
encourage to foreign
company to establish their
business in Indonesia

Bank of Indonesia
Quotas & Tariff is lower in
Indonesia

23. MARKET ENTRY REGULATION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS
Mexico







Flat rate
Peso
Currency value is rising
Labour issue is in the
Mexican Law
Many type of distribution
channel
WTO (1995)
Labour wage according to
skill
Indonesia

Corporate Tax is 15%-30%

Rupiah

Labour union (Public
Service International)

Government help to
increase their transport
infrastructure

WTO (1995)

Corruption high

24. THE BEST TARGET MARKET
FOR SKODA
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

The above analysis shows the country with the highest
market potential to penetrate in for SKODA is Indonesia.
There is more market potential in Indonesia compared
to Mexico

25. RECOMMENDATION AND
CONCLUSION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Plan a successful promotional strategy

Using a Local distributor to gain knowledge

Gain understanding of the competitor

Aware on the political situation and legal regulation

Respect host country policy

26. EVALUTE BY THIS ELEMENTS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS
1.
Goals and objectives
2.
Control
3.
Resources
4.
Experience
5.
Competition
6.
Regulations
7.
Market size
8.
Risk
9.
Flexibility
10.
Feedback
And we have two highly recommend strategies.

27. ENTRY MODEL
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS

Our final recommend Entry Model is Foreign Based Sales
instead of Wholly Owned Manufacturing Subsidiary

28. MARKETING STRATEGIES (7PS)
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS
Focus on the first 4Ps

Products

Pricing

Promotion

Place

People

Physical evidence

Process

29. PRICING AND PROMOTION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS

Pricing method
Buying Price [€]
Total shipping costs [€]
Insurance costs [€]
Goods customs [€]
Import duties (Tariffs) [€]
Value-added tax (VAT) [€]
Selling Price [€]

20,000
2,000
200
22,200
2,220
2,442
26,862
It is 10% of buying price
It is 1% of buying price
It is 10% of goods customs
It is 10% of (goods customs + tariffs)
Budget for promotional mix
Type of promotional mix
Advertising (Magazine)
Internet
Total budget
Cost per unit
Units
Total cost
2
350
1,000
3
2,000
1,050
3,050

30. INTERNATIONAL MARKETING
BUDGET AND PROFIT
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS
Cost of entry strategy

̶
Mainly in Shipping cost and Import duties
Forecast of future sales

̶
NO. of sales will increase in the next 3 years
Projected income statement

̶
Estimated Best/Worst case happened in next 3 years
Breakeven analysis

̶
The stress will be first 2 years in order to cover our investment

31. P/L SCENARIO
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS

32. RECOMMENDATION AND
CONCLUSION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKETING
PLAN
CONCLUSIONS

Export strategy, foreign base sales branch

Understanding of competitor (Toyota & Daihatsu)

Focus on pricing and promotion strategy

Financial plan -> lost in first 2 years, 3rd year breakeven

33. OVERALL CONCLUSION
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

Advantage from our parent company

Indonesia or Mexico -> Indonesia is the best

Indonesia is in WTO (1995)

Letter of credit

International Trade Law

Document for Export

34. REFERENCES
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS

More than 60 references are available in full report

35. QUESTIONS AND ANSWERS
INTRODUCTION
COMPANY
SITUATION
ANALYSIS
GLOBAL
MARKET
SEARCH
IN-DEPTH
MARKET
ANALYSIS
ENTRY
STRATEGY AND
MARKET PLAN
CONCLUSIONS