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Market Entry Strategies Case Study

Case Title:

Volkswagen in China: The Growth Challenges

Publication Year : 2004

Authors: Devangana Sisodia, Sumit Kumar Chaudhuri

Industry: Automobiles


Case Code: MES0015

Teaching Note:  Not Available

Structured Assignment:  Not Available

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By 2003, China had become the world's fastest growing major automobile market. Industry experts opined that China would soon emerge as the fourth largest auto-market after the US, Japan and Germany. Volkswagen, China's largest automaker in 2003, with a 37% market share, stood to gain from the expanding market. However, the second quarter of 2004 witnessed an abrupt slowdown in the sales of automobiles in China. Volkswagen also faced increased competition from companies like General Motors and Toyota. In a bid to maintain its position in the Chinese market, Volkswagen plans to increase its investments in the country to 5.3 billion euros (US$6.5 billion) by 2007.

Pedagogical Objective:

  • To discuss Volkswagen's growth in the Chinese market and the strategies it adopted to deal with the increasing competition and the changing economic scenario of the country.

Keywords : Volkswagen (VW); China; Automobile industry; China's automobile industry; Shanghai Volkswagen Automotive Company; FAW-Volkswagen Automotive Company Limited; Growth strategy; VW joint ventures in China; Growth challenges in China; Competitive Strategies Case Study; VW expansion plans in China; FDI (Foreign Direct Investment) in Chinese auto sector

Contents : 
Volkswagen: Entering the Chinese Automobile Market
China Auto Industry Landscape
Growth Challenges in China
The Future Scenario of the Chinese Automobile Market
China’s Passenger Car Sales 1995-2005
Implications of China’s Accession to WTO
China – Total Deliveries Volkswagen Group

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