How does Peugeot build a competitive edge against Chinese and foreign car industry
- The built up of a competitive edge world wild
- How does Peugeot plans to enter on the Chinese market and complete against the China industry car?
In this report, we focus on the PSA Peugeot Citroen group. Firstly, we will analyze the company and its features and key data. PSA Peugeot Citroen group is a French car manufacturer, and is the result of a merger between Citroen and Peugeot Limited companies. Thanks to the framework of a coherent marketing and production plan and an international vision, the group is ranked as the seventh largest car manufacturer in the world with more than four million vehicles sold in 160 countries.
The company is organized around five main industry segments: Automobile division, Faurecia, expanding sales in the Chinese market (partnerships with Geely-Limin and Xuyang), GEFCO specialized in integrated logistics for industry, PSA Finance Bank, and the seating, front end Exhaust Systems Businesses. All four Business groups are now active in China.
Their success is due to their capacity, creativity, technological innovation and from the two strong and complementary brand's identities. The group is actively expanding its production in the Chinese, Latin American and Russian markets. There is a strong rivalry with the existing players on the European automotive market, as Volkswagen, BMW and Mercedes.
The new competitors have a poor power of negotiation, because it takes time before representing a real threat. The threat of substitutes is more powerful with the commitment to the environment. The power of the buyers is very high because they control the demand. The clients of PSA are individuals who buy little cars and firms who buy high-level cars. The suppliers have a real power of negotiation with PSA in terms of pieces. However, PSA takes the advantage in terms of turnover.
Furthermore, the group is the second largest on the European Market and the European Union regulations impose additional costs and obligations on the group and would affect its margins. Then, we will deal with how PSA overcame it. Finally, we will see how PSA penetrates the Chinese and foreign market to build a competitive edge against them.