IndexCommunity PESTEL AnalysisPoliticalEconomySocio-CulturalAnalysis of the External Environment Using Porter's Five Forces (Industry)Competitive Rivalry within an IndustryBargaining Power of CustomersBargaining Power of SuppliersThreats of New CompetitorsProduct Threats or substitute servicesStrategic ideas for BMWProduct pricing that matches geographical needsAdvertisingWith the aim of creating a brief but detailed analysis of Bayerische Motoren Werke (BMW), this report analyzes the environment in which the company operates and also allows you to understand the factors that play a role in influencing the future of the company. We say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay The history of BMW can, in fact, be traced back to the founding of the Rapp-Motorenwerke by Karl Rapp, in Munich (Germany) in 1913. The company began producing aircraft engines. The modern Bayerische Motoren Werke (BMW) officially existed in 1917, when Max Friz and Franz-Josef Popp took over Karl Rapp's business (Just-Auto, 2005). BMW's pioneer factory was built in Neulerchenfeldstrasse, Germany. Going public in 1918, BMW became one of the world's largest automobile, engine, and engine manufacturing organizations. In addition to being the parent company of Rolls Royce, BMW also produces Mini cars. Examples of some products manufactured by BMW are automobiles, motorcycles and even plug-in electric cars under the BMW I sub-brand. The BMW name has become a symbol of standard, efficiency and engineering expertise that has inspired a loyal customer base around the world . BMW's long-standing marketing message was simply "the ultimate driving machine" (Strategic shake-ups for the auto Industry, 2004). PESTEL Analysis of the Political Community The PAP has retained power repeatedly through elections since independence, with Singapore's economic success underpinning the party's popularity and contributing to the long period of political stability. With reference to this statement, it emerges that the risks of any major political changes in Singapore are not relatively high. That said, I can assume that Singapore-based organizations will not need to be too cautious of any significant government-related issues that they predicted would negatively impact their business. ASEAN Vision 2020, adopted by ASEAN Vision 2020 ASEAN leaders, on the occasion of ASEAN's 30th anniversary, agreed on a shared vision of ASEAN as a concert of Southeast Asian nations, looking towards the 'external, live in peace, stability and prosperity, united in partnership in a dynamic development and community of caring societies ( ASEAN COMMUNITY). In addition to the above statement, Singapore is part of international peacekeeping organizations such as the Association of Southeast Asian Nations (ASEAN) and also the United Nations (UN). By being part of these organizations, Singapore can ensure that the possibilities of any regional disputes or differences can be resolved in a peaceful and amicable manner. Economy Amid a weaker economic backdrop, unemployment among residents and citizens rose in Singapore and overall employment grew the slowest in six years, the Ministry of Manpower said on Tuesday (15 December) (Channel News Asia, 2015) . As the unemployment rate rises in Singapore, more people would have less to spend and as a result, it would create a decrease in consumer demand for BMW. A decrease in consumer demand could lead to BMW having to lay off its employees, which will contribute to theunemployment situation and therefore shaping a potential cynical problem. In addition to facing unemployment, the cost of living in Singapore is one of the highest in the world. In order to promote more frequent use of public buses and trains, the Land Transport Authority (LTA) of Singapore has implemented an increase in the price of the Certificate of Entitlement (COE) for car owners. Car owners unexpectedly noticed an increase in COE prices for A- and B-category cars, reflecting strong demand among car buyers and car dealers with orders in hand, industry players said. Socio-Cultural Due to rising costs and insufficient financial capabilities, many in Singapore have cut costs and are forced to reevaluate their spending, which further results in having a budget to make purchasing decisions, whether small or large. According to the Economist Intelligence Unit (EIU) (BBC Business, 3 March 2014), Singapore became the world's most expensive city to live in in 2014, surpassing 131 cities globally. When more potential buyers change their purchasing habits due to curbing excessive spending, they begin to reconsider spending unnecessarily on a car, which will result in a decline in sales of BMW cars and motorcycles, which means that profit for BMW will decrease. A survey conducted by Nielsen and commissioned by NTUC Income revealed that as they become knowledge-empowered, Singapore's young adults are motivated to start planning for their retirement. With such a mindset, BMW could see a decline in the percentage of potential buyers as more people would tend to be more likely to secure a future with financial stability rather than spending their savings on luxury products such as BMW cars. This will then lead to decrease in sales and profits for the organization, thus creating more problems for organizations in terms of promoting their products. Analysis of the external environment using Porter's five forces (industry) Competitive rivalry within an industry The automotive industry in Singapore is made up of numerous competing companies vying for potential buyers and sales opportunities. While BMW has a reputation for producing excellent quality cars with improved features, many of its competitors aim to meet the basic needs that buyers look for in a passenger car, for example Honda, Toyota and Mitsubishi. Despite not having the best features of a car, these automotive organizations aim to capture buyers' needs instead of capturing desires like BMW. As for the economic factors affecting the industry as a whole, potential buyers are already scarce and when there are multiple competitors in the field competing for the same group of customers, the chances of gaining a greater advantage over other competitors would be lower . Bargaining power of customers Among them are Nissan March, Kia Forte Koup and Chevrolet Aveo, which are proven stalwarts on Singapore's roads. They're not just reliable workhorses, they're also economical family-friendly cars that keep petrol costs low (10 Cheapest Cars in Singapore, 2013). With the increase in COE prices, customers are inclined to get better deals on the motor vehicles themselves. in order to meet your budget, especially if you also take into consideration the high prices of the COE. Competitors such as Honda, Kia, Nissan and others produce cars of the same quality and therefore offer more purchasing options for customers. With a wide range of brands and sellers includingchoose, BMW should put more effort into keeping up with the latest technologies and trends to stand out and be different from other brands in the automotive industry. With more purchasing options, customers have higher bargaining power and the likelihood that customers will make BMW their final choice will decrease significantly. Bargaining Power of Suppliers BMW spends approximately 25% of their revenue on research and development and because they invest much of their innovations and improvements in the cars they produce, they are able to gain more recognition and approval from the public, driving its current success (LWKH, 2006). With more dedication and innovation, BMW strives to be the white knight in the automotive industry, thus creating an advantage over other suppliers in the same industry. Although there are many other suppliers providing the same services and products, BMW allows itself to maintain an image of being the top of the industry which nullifies any other supplier attempting to compete for potential buyers, making it relatively different from brands such as Honda, Nissan and Kia. Threats from New Entrants The barrier to entry for new businesses in the automotive industry is relatively high because it not only involves high financial capital and support, but also requires obtaining a license to practice as a car dealer. In addition to this, the government has also implemented an "additional tiered registration fee" in accordance with the "open market value". With such high costs of opening a business that may have little chance of thriving in Singapore, where residents are cutting costs to afford the high cost of living, the threat of new entrants in the automotive sector is not a concern. Threats of Substitute Products or Services The level of threats of substitute products or services is not high as BMW has already earned the reputation of being one of the most advanced and luxurious automobile companies in the world with its position in 2nd place among brands most valuable automobiles in the world. The new BMW X5 features a new inline 6-cylinder diesel engine that offers a better balance between fuel consumption and performance. This latest technology and also the new 8-speed automatic transmission bring significant improvements to the vehicle's efficiency. It uses the most up-to-date technology in reducing emissions. Aside from having a distinct look that attracts buyers for its versatility and undeniable presence, BMW also produces cars that save more energy. Strategic Ideas for BMW Product Pricing One of the areas BMW can work on is the pricing of their products and the cars they sell. Despite being one of the leading brands in the automotive industry, to compete with other brands operating in Singapore, BMW should adjust its prices to what meets the reasonable budget of its potential buyers' price range in the geographic area where they are located . in, creating more business opportunities for themselves. This way, BMW will be able to secure its positioning as one of the top choices for buyers. Improving the efficiency of the iDrive function The iDrive function in BMW cars is really difficult to find in other brands' vehicle engines. However, there are some areas where this functionality is lacking and making improvements in these areas will give BMW an edge in achieving the title of leading automotive company among others. Areas such as the menu structure and even the methods of entering information on the tablet can be improved. For example, the use of voice recognition will be very useful to drivers especially while driving. Even i..