A MNE (Multi National Enterprise) is a company that has an integrated global philosophy concerning both domestic and overseas operations. It means that these companies have to adapt their strategy and structure according to their different actions, knowing that today's marketplace is very dynamic and changing very rapidly. MNEs just have to find the appropriate strategy and structure the best matched to their needs. Global expansion can be profitable for most of these firms, but there are a lot of diverse strategies they can adopt to compete globally, and a lot of new market they can try to enter. Worldwide expansion can consist in a simple transfer of the skills and products from their core market to other ones where the local competitors lack those competencies. MNEs just have to find the appropriate strategy and structure the best matched to their needs. Global expansion can be profitable for most of these firms, but there are a lot of diverse strategies they can adopt to compete globally, and a lot of new market they can try to enter.
[...] The United States of America has a very urban population provided that it is made of 50 metropolitan areas of more than one million inhabitants. Americans are concentrated in big cities, such as New York City, Los Angeles, Chicago, Houston or Philadelphia (the 5 biggest ones, counting respectively and 1,5 million inhabitants only within the city, and and 5,8 million with the metropolitan area). People are rather gathered on the coast. The East coast including New York City, Philadelphia, Boston, Pittsburgh, Baltimore, etc. [...]
[...] To exploit competitive advantage in Europe, Peugeot started by a "Brownfield site" strategy: it took over the European division of Chrysler as the American firm had some problems, in 1978. This takeover required a lot of investment during the first half of the 80s. Then, in 1984, PSA Peugeot Citroën operated to a joint venture to reach the Chinese market (China requires a joint venture with a local company for any foreign firm to access to its market). It was with the Dongfeng Motor Corporation, giving birth to the Dongfeng Peugeot-Citroën Automobile venture, which was successful, provided it still produces a lot of cars, among all the famous Citroën Xsara and Picasso, but the Peugeot 307 for the Chinese market as well. [...]
[...] Some Peugeot dealers are still in business, the group can use them. It used to have 151 dealers when it left the country, the objective will now be to have at least two dealers in every state, knowing that important states like California and New York will have several. Another possibility could lead Peugeot to sign an agreement with one existing car brand on the American market. This could be conceivable provided that it is already in relation with groups as Mitsubishi, Toyota or Ford. [...]
[...] On the other hand, external factors can be improved, the market the group is currently on may not be sufficient, that is why it has to find more outlets for the company, commencing maybe by the US Expanding in the United States of America? a. Characteristics of the country (P.E.S.T. Analysis) Political environment The United States of America is a federal republic. It has the oldest written constitution in the world, since 1787, and encompasses three levels of government: federal, state and local. [...]
[...] Possible adaptation to the market After the failure undergone in 1991, Peugeot has now the means of conquering again the American market. First of all the release of the first 4x4, the 4007, has been announced for July 2007 in Europe. Born from a collaboration with Mitsubishi (based on the Outlander) and with Ford for the motor, the first French Sport Utility Vehicle (SUV) should compete perfectly with its American competitors. One reason of the failure on the US market was the lack of offer for this kind of big cars; Peugeot has now put right this mistake. [...]
Online readingwith our online reader
Content validatedby our reading committee