The Automotive IndustryBy: Alannah Da Silva, Chad Brkich, and Devanie Christie

Presented to: Paula DelMasoMarch 30, 2016

Automotive Sales and Market Share

15%

12%

8%

66%

Market Share in Canada 2015Ford General MotorsHonda Other Motor Companies

2013 2014 2015 2016(Prediction)

18.33

19.42

20.64

21.06

North American Auto SalesSales in units of millions

AttributesPrice

Price can be a large decision making factor when purchasing a

vehicle.Consumers will make a purchasing primarily based on their income.

Sustainability

How long a car can last a person is also very important to consumers.

If a car has a reputation for breakdowns and high service

intake, a consumer will likely opt for a car with sustainability

Positioning MapMore Sustainability

Higher PriceLower Price

Less Sustainability

HONDA

Devanie Christie

Company Background: Honda• Honda first arrived to Canada in 1969 with motorcycles and power

equipment. The first vehicles sold were Honda civics in 1973, followed by the accord in 1976 (10)• The company began production of Honda vehicles in Canada in 1984. In

1988 Honda opened its first automobile factory in Alliston, ON. The first manufacturing plant opened by a Japanese company in Canada (10) • As of 1990, Honda sold more than 100,000 cars in Canada, as of 1991 I

million vehicles were sold in Canada, in 1993 Honda reached it 500,000th vehicle production and as of 1997, in June Honda reached its 1 millionth vehicles (10)

4 P’s: HondaProduct Honda Civic 2016 Honda CR-V 2016 Honda HR-V 2016

Honda Accord Coupe 2016

Honda Civic Coupe 2016 Honda Civic and Accord Sedan 2016

Honda CR-Z 2016 Honda Civic Coupe SI 2016

Honda Accord 2016

Honda Accord 2016 Honda Pilot 2016 Honda Civic Hybrid 2016

Honda Fit 2016 Honda Odyssey 2016 Honda Accord Hybrid 2016

Product Continued…• Features: • Look and design: The looks of the Honda cars are stunning or rather outstanding

as its design among its competitors, is simple and not too over the top (10) • Interiors: • Interiors are brilliantly designed, multidimensional dash, steering wheel with

audio controls, I pod connective music system, comfortable seat, safety features like airbags etc (10)• Engine, Gearbox and Performance: • I-VTEC engine, 4 cylinder engines, smoothest engine widely spaced gear ratios,

paddle shift, ride and handling, independent suspension on the front, wheel base ,ABS, dual air bags and EBD are standard feature of this car (11)

Price

• Honda cars are more costly than the other cars in the same segment. It targets the people who need an outstanding car in the segment in the case of design, comfort, quality and innovation.

Honda Fit $14,730.00

Honda Civic Coupe SI $26,850

Honda Civic Sedan SI $26,850

Honda Civic $19,455

Honda Civic Sedan $15,990

Honda Civic Hybrid $27,200

Honda CR-Z $26,290

Honda Accord Sedan $24,150

Honda Accord Coupe$27,090

Honda Accord Hybrid$29,990

Honda HR-V $20,690

Honda CR-V $26,190

Honda Pilot $35,490

Honda Odyssey $30,690

Honda Civic Hybrid$27,200

Honda Accord Hybrid$29,990

Honda CR-X $26,290

Place• Honda first arrived in Canada in 1969 and opened up there first

manufacturing plant in 1988 in Alliston, ON. As of today Honda vehicles and products are available to consumers all over the world in Canada, The United States, Japan, China, Thailand and much more! There’s also a feature on their website that allows consumers to find the nearest dealerships and book a test drive (10)

Promotion• Honda is a brand known for its quality and innovation. Honda was never into an

aggressive promotional activities but the company always tried to maintain the quality and created a brand image by providing better customer service (10)

• Honda has been very careful and precise in their advertisements. Honda always projected their image as most reliable brand, advanced technology, eco-friendly cars (10)

• Even considering the television commercials, Honda promoted their hybrid car that runs without gasoline and emits water as the byproduct rather than advertising the specific brands existing in the market. The ad was more concentrated to the company’s technological advancements and eco-friendly image which differentiated Honda from the competitors (10)

Competitive advantage Honda• Reliability: For a decade now, Honda has a great reputation of quality

building strategies and parts. Honda vehicles are consistently ranked very high terms of quality by consumer reports as well as independent consumer groups. As a result of their reliability, many old Hondas are still being driven today. (12)• Fuel Efficacy: Honda received high marks for overall fleet fuel Effiency.

Recently Honda was one of the first companies to release hybrid vehicles the Honda Odyssey and continues to lead the way with a huge section of hybrid vehicles (12)

Competitive Advantage continued…• Value: Honda’s are usually known to hold their value. They are known as

one of the best ‘Bang for Your Buck’ car brands. Whether looking at their luxury line or their sports car offerings, costumers get a lot for their money when buying Hondas. Their cars routinely rank on par with more expense counterparts in the automotive industry, according to consumer reports (12)• Focus on factory flexibility: Unlike most manufacturers Honda can produce

multiple autos on single assembly lines one after another and switch lines to newly designed vehicle in just hours. Honda invented the flexible factory through an innovation known as synchronized engineering meaning like each function is assembled in it’s own area like the brakes, transmission etc (12)

General Motors

Chad Brkish

Company Background: General Motors

• The true start of GM Canada starts with The McLaughlin’s Chevrolets. They were as much of a success in Canada as Chevrolets were in the United States. By 1918, though, neither George nor Sam had sons interested in carrying on the business. In a five-minute meeting, GM management agreed to buy the McLaughlin business, but on one condition - that the McLaughlin’s stay to run it. Sam and George became the first president and vice president of General Motors of Canada. Sam remained president until 1945. When he died in 1972, at the age of 100, he still was chairman of the board..

• Today GM of Canada has the capacity to manufacture more than one million units in a single year - generating significant export earnings by shipping about 90 percent of those vehicles to the United States. It also satisfies a third of Canada's 1.2 million unit market, the ninth largest automobile market in the world. In the 1980s, GM of Canada began an $8 billion reindustrialization program. Now, the GM Autoplex in Oshawa is the centerpiece of GM Canada's manufacturing operations. It is the largest, most modern, integrated vehicle-manufacturing complex in North America.

4 P’s: GMProduct• GM products have a mix of many brands worldwide. Producing cars and truck in 35 countries. Their brands

include Baojun, Buick, Cadillac, and Chevrolet. GMC, Holden, Jiefang, OnStar, Opel ,Vauxhall, Wuling, GMAC. • These brands cover all passenger and truck vehicle segments form, Compact, Subcompact, Sedan, SUV, High

Performance, Luxury and Truck vehicles. Their product range allows them to compete in all segments of the automotive vehicle business including financing of vehicles as well as fleet sales

Price• These brands and product mixes cover a variety of price points for the automotive consumer starting as low as

$12,600.00 for a Chevrolet Spark to $85,000 for the Corvette. In short there is something for everybody in the product mix based on the consumer’s needs.

• With the addition of GMAC financing, GM can make these cars affordable based on their in-house financing and leasing capability allowing them to tailor make a financing plan. This in turn is designed to make the vehicles affordable for each consumer and allowing them to get more vehicle for the monthly payment dollar making it easier to upsell a vehicle and increase profits on each vehicle.

Continued…Place• Currently Gm vehicles are marketed and sold through traditional dealer channels across the world. They

produce and sell cars and trucks in 50 countries. • The dealer channel is not only deigned to sell and assist consumers in finding the right vehicle at the right price

but to service them as well. All dealership locations worldwide are available on GMs website www.gm.com/select-a-contry.html.

PromotionGM, like many other car companies promote their vehicles in a few ways. GM since its Bankruptcy in 2009 has discontinued a variety of brands and now only focuses on the core brands they picked. They use all mediums of advertising, including TV, Radio, Billboards, Magazines and Newspapers, Web Advertising and Social Media. Other than reinforcing their brands in commercials, GM constantly uses dealer and consumer financial incentives and a variety of vehicle sales promotions to drive consumers to buy their product. Currently in America GM is focusing a major effort on its GMAC Brand due to the resurgence of SUV and Truck buying.

Competitive Advantage GM• After looking at GM’s performance after their bankruptcy in 2009 I see a few

competitive advantages that they can capitalize on in the market. • When GM went bankrupt in 2009 it allowed them to clean up their balance sheet and

not be hindered by past mistakes and liabilities that were choking their growth and viability for the future of the company. This has also allowed them to lower their manufacturing costs by renegotiating all labor contracts and supplier contracts.

• Even though heavily critiqued on their poor quality of product prior to the bankruptcy this allowed GM to create a new ad campaign to show that they have heard the criticism and were increasing the quality of their product. This appears to be working in both the manufacturing sense and the consumer’s perception.

• The popularity of GMs SUVs and Trucks seems to give them a competitive advantage in the market in the US and Canada.

Alannah Da Silva

Company Background: Ford

Ford was incorporated in 1903 with 12 investor and 1000 shares, however it wasn’t till 1904 where they had built their first manufacturing plant. The first car to be for distribution was the Model C.Ford had designed and built its first truck in 1917 that weighted one ton.Ford acquired ownership of Lincoln in 1922 from his former business partner Henry Leland, since then producing luxury vehicles such as the Zephyr, K-series and the Continental.Ford went on to design and produce Tri-motor airplanes, military vehicles and even assisted in creating the Mission Control Centre for NASA.Some of Fords most popular vehicles throughout the years include, the Thunderbird, Mustang, Taurus, Fiesta, Ranger, Navigator and the F-series.

4 P’: FordProduct• Ford provides a variety of vehicle types including, Cars, SUV’s, Trucks, Vans and

CUV’s(1)• The type of cars Ford produces are typical motor driven cars, hybrids, and

electrical cars.(1&2) • Fords SUV’s and CUV’s are convenient, versatile and capable. With the power to

tow and acceleration to easily merge through traffic and highways. (2)• Ford produces both personal and commercial use trucks. (2) • Ford also provides many offers and services including: winter safety packages,

owner advantage rewards, warrantees on parts, and scheduled maintenance. (3)

Product continued…Hybrids Models

C-Max Hybrid Sel

Fusion Hybrid Se

MPG: City/Hwy

50/44 52/49

L/100KM: City/Hwy

5.6/6.4 5.4/5.7

Starting at $31,444 $28,699 Seating for 5 1-5 Electric Models

C-Max Engeri

Fusion Energi Se

Focus Electric

MPG: City/Hwy

50/44 27/40 135/118

L/100KM: City/Hwy

5.6/6.4 10.5/7 2.1/2.4

Starting at $31,999 $34,199 31,999 Seating for 5 1-5 5 Motor-run Models

Fiesta Focus Fusion Mustang C-Max Taurus

MPG: City/Hwy

33/43 30/42 27/40 21/34 50/44 22/32

L/100KM: City/Hwy

8.5/6.5 9.3/6.7 10.5/7 13.6/8.4 5.6/6.4 13.1/8.7

Starting at $16,049 $17,199 $22,499 $26,398 $25,999 $30,999

Seating for 5 5 1-5 1-4 5 1-5

Price• Along with customizable options

including paint, chrome, tires, and interiors; the price on a vehicle can vary. (4)• The chart on the right are

starting prices for Fords vehicles.

Cars Starting Price

Fiesta $16,049

Focus $17,199

Fusion $22,499

Mustang $26,398

C-Max $25,999

Taurus $30,999

CUV’s and SUV’s

Escape $23,699

Edge $31,349

Explorer $33,499

Flex $31,799

Expedition $52,148

Transit Connect $29,099

Trucks and Vans

F-150 $25,799

Transit Connect $27,299

Super Duty $36,749

Transit $34,149

Commercial Truck $32,369

Place

• Ford vehicles are sold in North America, South America, Europe, Middle East & Africa, and Asian Pacific. (5) • They are sold at three different dealerships: An exclusively Ford

dealership, an exclusively Lincoln dealership and a Ford and Lincoln combined dealership. (5)• Its appears in South America and Europe, primarily only Ford vehicles

are being sold whereas in North America, Middle East & Africa and Asian Pacific both Ford and Lincolns are being purchased. (5)

Promotion• Ford offers 4 special programs for eligible customers:

• The Our First Responders Appreciation Program – First responders such as police, firefighters, EMT’s and their families receive discount in honor of their services to this country and the people in it. (6)

• The Study Hard, Drive Well Program – Collage students and graduates are eligible to receive $500 incentives and best possible rates. (6)

• Ford Mobility Matters Program – Persons with disabilities and those who care for them are given adaptability with regards to a vehicle purchase. They may also receive $1,000 reimbursement for equipment. (6)

• Military Honor Program – Those who serve and have previously served in the military along with their families receive discounts as well as $500 bonus cash if eligible. (6)

• In 2014, Ford teamed up with T-Mobile and offered those who purchased a device from T-Mobile a $25 Advantage Reward Card towards a Ford product. (7)

Competitive Advantage: Ford• Ford has top sales and market share within Canada and the U.S. because

of its reasonable pricing and use of sustainable materials to reduce the end-life of their vehicles. (8)(9)• Ford Motor Credit Company offers consumers and dealerships; lines of

credit, loans, and leases. (9)

• Because of government requirements internationally and overall concern the company has for the environment;

Ford produced the EcoBoost Engine and continues to

develop its engineering to be environmentally friendly.(9)

References1. New Cars from Ford | Research Fuel Economy, Performance, Pricing and More | Ford.ca. (2016).

Ford.ca. Retrieved 25 March 2016, from http://www.ford.ca/new-cars/?gnav=header-cars 2. Ford - Cars, SUVs, Trucks & Crossovers | Ford Vehicles| The Official Site of Ford Vehicles | Ford.com.

(2016). Ford.ca. Retrieved 25 March 2016, from http://www.ford.ca/new-trucks/?gnav=header-trucks 3. Ford Service | Our Offers & Request an Appointment | Ford.ca. (2016). Ford.ca. Retrieved 25 March

2016, from http://www.ford.ca/service/ourOffers/?gnav=header-owners#page=ourServices-fordService

4. Ford Vehicle Brochures, Apps, Manuals and Guides | Ford.ca. (2016). Ford.ca. Retrieved 25 March 2016, from http://www.ford.ca/brochures/?gnav=header-tools

5. Ford Motor Company,. (2016). Ford Motor Company 2015 Annual Report. Retrieved from https://corporate.ford.com/content/dam/corporate/en/investors/reports-and-filings/Annual%20Reports/2015-Annual-Report.pdf

6. ("2016 Ford F-150 | View Current Incentives & Offers | Ford.com", 2016)7. Wood, C., Morrison, J., & Joakim, M. (2014). @ Ford: Competitive Advantage (1st ed.). Sara Tatchio.

Retrieved from http://www.at.ford.com/news/Publications/Publications/at_Ford_October_web.pdf8. Sustainable Materials - Sustainability Report 2014/15 - Ford Motor Company. (2016).

Corporate.ford.com. Retrieved 30 March 2016, from http://corporate.ford.com/microsites/sustainability-report-2014-15/environment-products-materials.html

References continued…9. Ford Motor Company,. (2016). Ford Motor Company 2015 Annual Report. Retrieved from https://corporate.ford.com/content/dam/corporate/en/investors/reports-and-filings/Annual%20Reports/2015-Annual-Report.pdf10. Inc., H. (2016). Honda In Canada. Honda.ca. Retrieved 30 March 2016, from http://honda.ca/honda-in-canada 11. Inc., H. (2016). 2015-2016 Honda Model Lineup of New Honda Cars, Trucks, and Hybrids. Honda.ca. Retrieved 30 March 2016, from http://www.honda.ca/vehicles 12. Simpson, L., & Simpson, L. (2016). Competitive Advantages of Honda | eHow. eHow. Retrieved 30

March 2016, from http://www.ehow.com/list_5916489_competitive-advantages-honda.html