The automotive industry is an important building block in society

The automotive industry is an important building block in society. It plays a key role in
daily activities (Nazir & Shavarebi, 2019). As such, AutoEdge has a chance to get back on its feet
and shine like it did in its good old days. Below is a SWOT analysis that will help guide the
company as it decides on its next course of action:
Strengths
The automobile industry in the United States is evolving. AutoEdge was shining in the
United States until 2005, when the board of directors decided to relocate sales and productions
overseas. The evolving industry offers the company an opportunity to reinvent itself and provide
new products that demonstrate innovation. Besides, Autoedge was already known for producing
products that gave customers value for money. By producing products that are in high demand,
the company has the chance to re-enter and capture a significant market share.
The company enjoys a strong position in the American market. Its re-entrance into the
market is likely to be received well as it had exited the market when its reputation and customer
loyalty was high. Also, the company has a diversified product portfolio, and this allows it to
capture a wide range of customers. It produces various products that meet the different needs of
its customers. Thus, it is likely to enjoy high sales as it has a diversified and widespread target
market. According to Orsato & Wells (2007), a company that shortens the lifecycle of its
products is able to meet the fast-changing demands of its customers while ensuring that it meets
their individualized expectations. AutoEdge has this advantage, which it can capitalize on to
recapture the American market.
Weaknesses

The company lacks a strong overall financial performance. In the recent past, AutoEdge’s
per-share stock has declined by $47 from $51 to $4. The decline is significant, and it goes
without saying that the company’s financial base has been affected. Another thing that affected
the company’s financial position is low sales. A decline in sales affected the company’s overall
performance, and this destabilized its financial base.
Another weakness is that the company’s reputation is weak. After being found guilty of
supplying goods that failed the quality test, the company recalled its products from the market.
The move was highly publicized, and this tainted the brand image. As a result, even the
company’s most loyal customers are skeptical about the quality of products produced by the
company.
Opportunities
The American economy is experiencing high unemployment, and this means that labor is
cheap and readily available in the country. Thus, relocating production to America will help save
n production and other operational costs. Besides, interest rates in the country are low, and this
could be an opportune moment to take a loan that will help boost the company as it gets back on
its feet financially.
The company has a strong customer loyalty in America. This is a great opportunity to tap
into through recapturing and convincing the customers that one mistake should not make them
lose trust in the number one company when it comes to quality goods.
Threats
The company is likely to face strong competition in the American market. Since it exited
the market almost two decades ago, a lot has changed, and many other companies have joined

the industry. Thus, the presence of such players will result in stiff competition. The company
must outdo itself to get a considerable market share. Another threat is that America is
experiencing a sluggish economy at the moment. Unemployment is high, and GDP is low, and
such economic factors are likely to daunt the company, especially considering that it does not
have a strong financial base.

References

Nazir, N. M., & Shavarebi, K. (2019). A review of global automotive industry’s competitive
strategies. World Journal of Science, Technology and Sustainable Development.
Orsato, R. J., & Wells, P. (2007). U-turn: the rise and demise of the automobile industry. Journal
of Cleaner Production, 15(11-12), 994-1006.