Report: Evaluation of a company.

Volkswagen is a global automobile company from German public automobile company that has grown in size and become an outstanding brand globally. The Volkswagen brand is popularly known for selling commercial, passage vehicles, motor cycles as well as other automobile brands. The Volkswagen business strategy going into future is to invest more on environmental friendly technology in the production of Automobiles. The company has a strategic plan to become a global leader in the automobile manufacturing by 2018. Customer satisfaction is key to the success of this strategy and this must be founded on sound technologies to ensure high quality. The business therefore intends to increase its production capacity to hit ten million automobiles per year and control a large market share in major world automobile markets. Volkswagen multinational organization is one the most promising business investment in the automobile industry due to its sound business strategy backed by strong financial footing. This makes it a very attractive company to invest based on its good business strategic plans, strong research and innovation, advertising strategies among other aspects (Sukitsch, Engert, & Baumgartner, 2015).

To achieve such ambitious business strategy Volkswagen has positioned itself in the global market as sustainable and fascinating automaker globally. The environmentally friendly product is the key value in their business strategy. This is based on the high levels of attack directed towards the automobile industry especially due to environmental degradation caused by the vehicles on roads emitting greenhouse gases (Weygandt, Kimmel &Kieso, 2015). Hence Volkswagen business strategy focuses on maintaining motivated and high quality workforce, quality products, customer satisfaction and innovation. Volkswagen is focused on high levels of business performance, and a sustainable future based on the gains they would have realized before the expiry of the current strategic plan period. Product development is the main aim of the business as it seeks to grow its market share and revenue. The company intends to focus on developing the most innovative and quality products that meet the customer dynamic needs as opposed to focusing on price competition.

Employees are vital assets in the organization and hence the Volkswagen strategy is to grow its attractiveness as the best employer in the industry by 2018. To come up with the best products that maximally meet the customer needs the organization understand that it requires a highly motivated and qualified team of employees? This team will be responsible for the coordination of the innovative activities and hence become the vital organ in the organization. The company has ensured that it maintain a highly motivated workforce that has independence to create an innovative environment.

Volkswagen In the early years used a lot of print media and television for placing its advertisements. However with the growth of information technology the company has changed its advertising strategies to include e-marketing strategies. The digital era ushered a new era of social media advertising and website advertising. Such channels are widely used by Volkswagen Company to ensure that it reaches out to a wider market segment. The change of advertising strategies has been fuelled by increased competition, especially in European and Asian markets. As part of strengthening its Brand image, the company has drafted an integrated marketing strategy that incorporates all the latest and effective platforms for communication and advertising. Such platforms like Facebook, Twitter, email, and other digital marketing platforms such as websites are some of the newest IT technologies that have been incorporated into the advertising strategy (Young, 2014).

The company has also engaged in corporate social responsibility initiates to ensure that it continues to build their brand image. Volkswagen has contributed in sponsoring car events and incorporated other creative and friendly purchasing methods such paying in installments. This helps those with low income to have to afford to buy the company products. The company has also invested heavily in its store distribution to ensure that its customers get access to the purchasing points especially those strategically placed at major cities and towns. The level of distribution of such outlets is also very high. Volkswagen also relies on its strong CRM systems that help to track all customer records to help in providing after sales services such as servicing of the automobiles among other customer needs. The company, therefore, markets its products as the most efficient and effective automobiles that can are user-friendly and environmentally friendly. The wide range of products availed by the company also allows covering a wide range of market segment raging from high end to middle-class market segments. The prices vary with luxurious automobiles being sold at relatively expensive and low fuel capacity engines going at fairly low and affordable prices. Hence the Volkswagen has been able to repackage their brand through effective advertisement strategies and methods that ensure the wide reach of potential customers (Pawar, Munagekar&Bhosale, 2016).

Volkswagen controls a large global market share from China to Europe to America and several other notable economies. China is one of the emerging markets that Volkswagen has taken control of the largest market share. China has high prospects of providing an expanded market share for the company products especially given its growing middle class who eventually would demand the cars. The largest boost also for controlling such markets is the size of the country population. China is a country which has large population and hence when providing such market segment with quality products the company stands a great chance to grow their revenue (Tintelnot, 2015). China is not only the most populated country but also one of the ready and biggest markets for the automobile industry. Volkswagen currently controls approximately twenty percent of the entire market share in China. In one year it produces approximately 722800 different cars all meant to satisfy the China markets (Weygandt, Kimmel &Kieso, 2015). Volkswagen has also invested in thirteen factories in the country to ensure that the factories meet the required supply of the vehicles in the local markets. According to the latest Volkswagen statistics generated in 2015, the organization generated a total of two hundred and thirteen billion euros globally in form of total sales revenue.

The Volkswagen market share in European region also stands at approximately eleven percent. The Volkswagen also produces 13.5 percent of all total global passenger vehicles. The Volkswagen has very high prospects of growing its market share in Europe especially due to growth in demand for luxurious vehicles. However, Europe remains a very competitive and volatile market, but the Volkswagen brand is doing better than its competitors. Additionally, Volkswagen has strong prospects of growing its market share in the United States and Brazil. More important is the growth in demand for automobiles globally. For a company like Volkswagen which is highly competitive the projected demand for Volkswagen products is expected to rise in major world economies both in Asian and western parts of the world. Consequently, the growth plans laid down by the Volkswagen Company indicates that its market share is projected to increase tremendously. The company has made good plans to invest additional eighty billion U.S dollars in setting up new plants in various regions such as china and other emerging markets. Its innovative technologies such as advanced Information systems and plug –in diesel hybrids is expected to boast its sales in such major markets with unlimited opportunities for sales (Hitt, Ireland &Hoskisson, 2008).

Its good performance especially in major emerging economies in the Asian region indicates that Volkswagen strategically positioned to grab the growing investment and market share. Based on its traditional lead in producing highly dependable products and fuel-efficient vehicles in emerging markets in Asian markets it stands the best opportunity to capitalize on such reputation and grow its market share.

The quality of the products being offered by the company in the market is of utmost importance to the customer level of satisfaction. The customers are as loyal as the perceived confidence they have on the company products. However, of late, this is an area that Volkswagen has been having trouble with especially due to the most recent scandal of diesel deception (Balbi, 2015). This scandal affected more than ten million cars produced under Volkswagen brand a situation that may require them to recall approximately eight million cars back to their industries. Some of their cars have also been accused of emitting high levels of greenhouse gasses into the air thus contributing heavily to the global warming. For instance, these three brands namely Bugatti, Lamborghini, and Porsche have been accused of excessive emission of greenhouse gasses into the air. The Volkswagen U.S.A brand is still struggling to solve the environmental concerns with the government authorities over its controversial diesel powered vehicles. In Australia Volkswagen brand is still facing product quality concerns from its customers especially about the high serving costs of its vehicles. The researchers ranked the Volkswagen products among the worst based on the feedback from the customers. The U.S.A based study that was conducted and released in 2012 rated Volkswagen products at a very due to their low level of reliability.

However, despite such challenges due to quality issues, there is hope since the company seems to have laid great strategies to deal with those issues. The quality department in the Volkswagen has renewed their efforts in the quest for better quality management practices. One of the major focus areas is on reliance on innovative technologies to produce environment-friendly vehicles. Green products are the way to go in future and to ensure that the company moves with this dynamics it has invested heavily in research and development to produce quality and environmentally friendly vehicles at affordable prices. Father steps have been made to ensure that the varying needs of the customers in different regions have been met. Identifying those needs as well as poetizing them in the production is one tremendous effort in improving customer satisfaction through quality. Factors that are specific to a market segment such as fuel prices, terrain, traffic density, road conditions among others will be have been focused on as part of ensuring maximum consumer satisfaction. Compliance with regional and local regulations especially in the environment is also a key factor in ensuring that the company brand reputation remains high in all the regions. These are measures that continue to be implemented offer great opportunities for the company investments in future (Zhou, 2016).

The Volkswagen Company has a very strong financial standing and despite the recent diesel scandal, the company generated an operating profit of 10.2 billion euros within the first nine months of 2016. Revenue generated from the sales of Skoda and Porsche products improved the company earnings. However, Volkswagen has continued to suffer from negative publicity due to the scandal, and this resulted in the poor performance of its major brands across the markets. Sales have reduced due to the scandal, and this continued to affect their operating profits and revenues negatively. While some of its brands performed poorly in the market due to the negative publicity others such as Porsches showed a tremendously good performance with 17 percent rise in sales. Despite the brand reputation issues the company remains in a good financial position just by the look of its stable liquidity ratios. This gives the company a stable footing to strengthen its environmental compliance through innovative technologies as well as deal with the pressures resulting from ruined public image (Weygandt, Kimmel &Kieso, 2015).

All financial results are shown in billions of euros. (1 euro = $1.11 as of May 31.)

Table from Source Tintelnot annual report (Source)

In conclusion, the analysis from various aspects including labor practices strategies, business strategies, market share, advertising, product quality and financial standing of Volkswagen business shows that it will be a sound choice to invest in the business. As a global automobile manufacturing brand, Volkswagen has sensible strategic goal of environmental friendly vehicle to meet the consumers' increasing awareness in environment protection. Volkswagen does not build on air, but has strong basis of advanced technology to support the high quality of its automobiles. The company has an aggressive goal of becoming a global leader in automobile manufacturing by 2018 and with its strong research and development, intense investment in global market, and wise advertising strategies, this goal is not merely a slogan. When deciding which business to invest, investors will majorly look at the strategic goal of the business and its long-term development plan. With solid strategic plans and manufacturing capabilities, Volkswagen is going to be a good investment that returns its investor solid returns in the long term. 

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