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Arguments for developing a new range of self-driving cars: - The market for self-driving cars is predicted to grow – VW hope to exploit this through its partnership with Gett - Edexcel - A-Level Business - Question 2 - 2018 - Paper 2
Question 2
Arguments for developing a new range of self-driving cars: - The market for self-driving cars is predicted to grow – VW hope to exploit this through its partnership... show full transcript
Worked Solution & Example Answer:Arguments for developing a new range of self-driving cars: - The market for self-driving cars is predicted to grow – VW hope to exploit this through its partnership with Gett - Edexcel - A-Level Business - Question 2 - 2018 - Paper 2
Step 1
Arguments for developing a new range of self-driving cars:
Answer
The market for self-driving cars is on the rise, and Volkswagen (VW) aims to leverage this growth through partnerships, such as with Gett for ride-sharing services. This strategic alignment targets consumers who prioritize the convenience of self-driving technology.
Additionally, as diesel cars witness a decline in popularity, pivoting to self-driving vehicles allows VW to tap into a market that is moving forward. From a strategic perspective, this aligns with Ansoff's model of new product development, positioning VW to potentially out-pace competitors in an evolving landscape.
Step 2
Arguments for improving productivity:
Answer
Improving productivity is crucial for managing costs effectively. By spreading fixed costs of labor and machinery across a greater number of produced units, VW can lower its unit costs, enhancing its price competitiveness.
Moreover, a focus on capital productivity, possibly through investments in new technology, can lead to significant gains in efficiency. Given the recent announcement regarding the reduction of 30,000 jobs, there is additional pressure on VW to enhance the labor productivity of its remaining workforce to ensure it meets consumer demand and maximizes profitability.