Research On Geely’s Domestic Brand Car Business Competition Strategy

As a pillar industry of national economic development, the automobile industry plays an important role in the national economic and social development, and is an important standard to measure the overall level of manufacturing industry of a country with its high degree of association, long industrial chain, a wide range of employment, stimulating consumption. Since21st Century, China’s automobile industry has developed rapidly and its industry concentration continues to increase. It became the world’s largest car market in2010, beyond the United States. With the support of national policy and opening up of the market, China’s automobile market gradually formed a situation in which the joint venture brands, foreign brands and domestic brands compete with each other. Geely is an early private car production enterprises entry into the automotive industry. Although it has developed rapidly in the past10years, there is still huge gap with the international automobile manufacturers, and the increasingly fierce competition. It also faces such problems and challenges as the international automobile brand competition on the domestic market, increasing in the number of domestic independent automobile brands, the weak brand appeal force and difficult to get rid of the low-end impression. How to deal with the many strong competitors who bring the pressure of competition and form their own competitive advantage is the problems that the enterprise must consider in the development process.Therefore, this paper takes Geely’s domestic brand car business as the object of study, uses the methods of combination of empirical analysis and normative analysis, quantitative analysis and qualitative analysis, uses the PEST analysis tool to analyze the macroscopic environment, uses the Michael Potter’s five forces competition interactive model to analyze the enterprise competition environment, identifies opportunities and threats facing the enterprise, and analyzes comprehensively the advantages and disadvantages of the future development of enterprises through analyzing internal resources and conditions and combining the case of merging the VOLVO brand at the same time. Using the SWOT analysis tools, the paper evaluates the system, and finally determines the strategy positioning, three strategic objectives of enterprise competitive strategy and specific content, and develops the implementation tactics and safeguard measures adapting to competition strategy. With the comprehensive analysis, we find that enterprise faces more opportunities than threats, more advantages than disadvantages currently. Although the increased production cost and increasingly fierce market competition are the big threats, such main environmental factors as the good macroeconomic environment, industry development prospects and enormous potential market demand mean a greater chance to the development of enterprise. Furthermore, its cost advantage and technology sharing after acquiring VOLVO also play an important supporting role in transformation and upgrading of its domestic brand car business. Based on this, this paper points out that Geely’s domestic brand car business should adopt the strategy of cost-leadership, supplemented by differentiation competitive strategy and strengthen enterprise cost management and control. Moreover, it should take acquisition VOLVO as a big advantage in the development of enterprises, putting safety performance as the main aspect differentiating from other competitors, and strengthen the innovation of technology. Analyze and elaborate the topic in aspects of optimizing organizational structure, speeding up brands recombination, enhancing cultural construction, increasing marketing intensity, strengthening financial control, etc., to support the implementation of cost-leadership strategy-differentiation strategy and achieve the goal.