2. Bosch : Target Germany as
expansion
As providers of Start Stop Starters this presentation covers
the first outlook towards market research of the target
Country : Germany
This is done through analysis of –
1. Political
2. Economical
3. Social
4. Legal
5. Demographic
6. Environmental
7. Technological
8. Market Landscape
9. Customers and Competitors
3. Political
Germany is a federal republic. The lawmakers at
the national level are the Bundestag, elected
every four years by popular vote and the
Bundesrat , which consists of 69 representatives
of the 16 states
Thereby holds 3 level government
Federal – States –Local (All taking care of
health, education, power, business tax)
4. Economical
Germany holds 40 of the fortune 500 companies, with
GDP (purchasing power parity):
$3.123 trillion (2012 est.) country comparison to the
world: 6
GDP (official exchange rate):
$3.367 trillion (2012 est.)
GDP - per capita (PPP):
$39,100 (2012 est.) country comparison to the world: 29
GDP - composition by sector:
agriculture: 0.8%
industry: 28.1%
services: 71.1%
The economic
analysis
revealed the
raise in the
buying
potential
The growing
services sector
5. Environmental:
Environmental effects of carbon capture and storage (CCS)
implementation strategies on a national level. The results
identify the future role of lignite and hard coal in German
power production.
Current Issues :
Emissions from coal-burning utilities and industries contribute to
air pollution; acid rain, resulting from sulphur dioxide
emissions, is damaging forests; government working to meet EU
commitment to identify nature preservation areas in line with the
EU's Flora, Fauna, and Habitat directive
Europe’s largest and world’s 6th largest carbon emitter
After signing Kyoto protocol
• 22% reduction in carbon emissions
• 39% of wind energy of worlds requirement
• Committed to use renewable energy source in future
6. Technological
German companies represent 15.6% of research
advanced goods worldwide, ranking 2nd in the world
(following US)
The Federal Government provides funding
through annual grants or endowment capital
In 2010 the Federal Ministry of Economics and
Technology created a budget of 2.3 billion euros for
technology research and development
7. Pollution Regulations :
The monitoring of air quality in Germany is
regulated by the Federal Emission Control Act
(BImSchG).
The Europe-wide limit values for particulate matter
(PM10) that have been in force since 2005 under
the Federal Emission Control Act.
Limit Values :
The PM10 annual mean value must not exceed 40
µg/m³.
The PM10 daily mean value must not exceed 50
8. Legal : Civil Law
More powers at state level, whereas federal police intervene only at national &
international level.
• THE ADMINISTRATION OF JUSTICE IS DIVIDED INTO FIVE BRANCHES:
- Ordinary,
- Labor,
- Administrative,
- Social and
- Financial courts.
This legal stability attracts foreign companies and is to the benefit of investments and
entrepreneurial activity in germany
Taxes :
Value added tax: 19%
Value added tax for food: 7%
Corporate tax: 15%
9. Global Economic
Exports:
$1.492 trillion (2012 est.)
The German economy - the fifth largest economy in the world in PPP terms and Europe's
largest - is a leading exporter of machinery, vehicles, chemicals, and household
equipment and benefits from a highly skilled labor force.
•Trade : Imports $966.9 billion (3rd highest in the world)
Machinery, vehicles, chemicals, foodstuffs, textiles, metals
(Import Partners: Netherlands 12.71%, France 8.3%, Belgium 7.19%, China 6.89%, Italy
5.88%, UK 4.76%, Austria 4.55%, US 4.25%, Switzerland 4.07% )
10. Start Stop system used by various
car makers
Citroën
BMW
Mercedes
Toyota
Renault
Mazda
Honda
Fiat Group
Volvo
Mahindra & Mahindra
Tata Motors
Opel
Ford
Kia
Hyundai
Volkswagen
12. Markets
The automotive industry is the largest industry
sector in Germany.
Statistics of 2011 : Car sales with a turnover of
EUR 351 billion – around 20 percent of total
German industry revenue
German passenger car and light commercial vehicle
manufacturers recorded foreign market- generated
revenue of EUR 194 billion for the year 2011. domestic
market generated revenue of EUR 80 billion was
created.
13. Markets Contd….
German automobile manufacturers produced
more than 12.9 million vehicles in 2011 –
equivalent to 17 percent of worldwide
production.
Germany is the European car production
leader: some 5.9 million passenger cars
(and more than 439,000 trucks and buses)
were manufactured in German plants in 2011
15. Denso
Net sales totaled 3,580.9 billion yen (US$38.1 billion), a 13.5
percent increase from the previous year. Japan
Europe accounted for just 14 percent of its revenue
Product claims to improve fuel economy by 4-8% compared to
conventional starters from the previous year.
DENSO operates in 36 countries with 130,000 employees
9.4 percent of consolidated sales in R&D activities.
Recent Price fixing scheme allegation effects the Brand Image
16. Valeo
Valeo revenue 10.9 bn, 68000 employees, Paris
Europe accounts to 50 plus percent of its revenue
Year Bosch Denso Valeo
2009 38714 24559 7499
2010 47259 23262 9632
2011 51494 24472 10868
Sales Revenue :
17. Bosch
Revenue of 52.3 Bn with 303000 employees
Bosch has more than 350 subsidiaries across over 60
countries and its products are sold in around 150
countries
Germany alone accounts to 23 percent share of its
revenue
7.3 investment in RnD with a great base in patent
generation
18. SWOT
Strengths
• Most wide presence with global
partners across the globe
• Strong hold in the German market
with strong brand identity
• Home based thereby deep know how
of market and culture
Weakness
• Loosing customer due to new
intervention in market with
comparable products by other
providers
• More diversion to other sector might
distract their focus
• Labour expensive as compared to
others
Opportunity
• Global Partners and suppliers
• Still large market within Europe
Threats
• Growing penetration by mainstream
competitors with stronger innovative
strength (Denso, Valeo both with high
RnD strategy)
• Growth of Global car sales in
Germany that are partners with
competitors
19. Action implemented
Strengths
• Grow the identity with more partnership
plans among other automotive
manufacturers
• Stronger Labour force and economies
of scale help them
Weakness
• Stronger Customer oriented
programmes
• Expanding solutions with integration of
existing products there by increasing
offerings
• Strong and skilled labour with regular
development programmes give better
and reliable product
Opportunity
• Can ensure their growth within
Germany by local expansion
• Can be more cost effective due to
several favouring factors
Threats
• The local support and German culture
of national belonging
• Relations with global car manufacturers
in Germany and local presence can be
cost effective as compared to other
competitors