SWOT Analysis of Mercedes Benz

The examination that is carried out to analyze the strengths, weaknesses, opportunities for improvement and growth, and external threats of an organization is termed as SWOT analysis (Harrison, 2010). The SWOT analysis helps the companies to identify their position in the market and allows them to improve based on the analysis (Jackson, 2018). Mercedes Benz is one of the top players in the field of the automotive industry despite fierce competition. Therefore, carrying out a SWOT analysis for Mercedes Benz is an opportunity to identify its strengths and weaknesses along with various opportunities and external threats.

Table 1: SWOT Matrix for Mercedes Benz

Note. Investigated from the annual report of ‘Daimler AG’, 2017

The strength of Mercedes Benz is its history that goes back to 1901 (Mercedes-Benz, n.d.). The company has built one of the strongest brands in the global automotive market with premier car manufacturing facilities around the globe. The company operates in 6 continents and 26 countries that include both, commercial vehicles, and passenger cars. Global manufacturing facilities help the company to keep the operating cost low. The company is leading in innovation since its inception, and it is very concerned about passenger safety and fuel efficiency and thus consistent in innovation. Mercedes Benz has strong financial stability that helps them spent more on R&D and produce the best product in the market. Moreover, the company holds a strong position in developing countries and has an excellent product portfolio that includes Sedan, Hatchbacks, Vans, and SUVs (Daimler, 2017).

The weaknesses of the company are after-sales service and maintenance cost of the Mercedes vehicles are expensive as compared to other brands in the same segment. Mercedes is a part of Daimler which is a huge group, therefore conflicting objectives of different companies within the group might be affecting the Mercedes Benz (Daimler, 2017).

There are several opportunities in front of Mercedes Benz are, the Asian market is growing continuously and the demand for the premier vehicles is increasing due to increasing income, changes in lifestyles, and economic stability such as India, China, etc. The automobile industry is growing globally, however, the world is seeking fuel-efficient technology for the automobile such as hybrid cars and Mercedes is a hope for many (Lee & Anderson, 2008) (Uchil & Yazdanifard, 2014).

Since the demand for the premier vehicle is increasing, therefore, competition is also increasing, the competitors such as BMW, Audi, and Volvo are giving a tough fight. The growth is affecting the passenger cars section due to fluctuating and rising fuel prices. Uncertainty in the economy producing unemployment, intermittent recession is the worst nightmares for the automotive industry. Increasing global warming has drastically changed the government policies around the globe that discourage the use of personal transport, reduced validity of the road permit are some policies that are affecting the entire automotive sector (Uchil & Yazdanifard, 2014).

The need of an hour is a hybrid or electric vehicle; despite severe government regulation, premier car manufacturing companies such as Mercedes have not been actively involved in the development, production, and marketing of hybrid/ electrical vehicles. Mercedes have strong innovation history and many R&D centers around the globe with a talented workforce. This strength of innovation should be involved actively to design and develop a hybrid/electric vehicle that will help the company to eliminate threats such as fuel prices and government regulations and reduce conventional competition.

Work cited

Daimler. (2017). Annual report. Stuttgart: Daimler.

Harrison, J. (2010). Essentials of strategic planning in healthcare (1st ed., pp. 91-94). Health Administration Press.

Jackson, T. (2018). A Detailed SWOT Analysis Example (Applicable to All Industries). Retrieved from https://www.clearpointstrategy.com/swot-analysis-examples/

Lee, H., & Anderson, B. (2008). Why the world automobile industry may move to Asia Pacific zone: the case of India’s automobile industry. World Review of Entrepreneurship, Management, and Sustainable Development, 4(1), 31. doi: 10.1504/wremsd.2008.016206

Mercedes-Benz. Corporate history. Retrieved from https://www.mercedes-benz.com/en/mercedes-benz/classic/history/corporate-history/

Uchil, S., & Yazdanifard, R. (2014). The Growth of the Automobile Industry: Toyota’s Dominance in the United States. Journal Of Research in Marketing, 3(2), 265. doi: 10.17722/jorm.v3i2.86