Macro micro environment on automobile industry

Since its foundation in the 19th century, this sector has grown to become an important part of the world economy in terms of revenue. However, since the global recession has passed, the sales of automotives are again back on track.

Macro micro environment on automobile industry

Macro micro environment on automobile industry

The business originally started with only a fleet of seven automobiles. The company remains privately owned with many of its rental outlets remaining decentralised. However, the car leasing service within the UK has struggled in recent years mainly due to the impact of the UK recession.

The result of the economic climate at the time meant that Enterprise and other similar companies encountered low demand due to international tourist numbers declining, intense pricing competition and weaker corporate leasing.

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Strong demand from businesses for vehicle leasing and growing demand from tourists in and subsequent years drove revenue back above pre-recessionary levels.

Despite the positive growth registered over the period, revenues in remained below the peak reached inas economic uncertainty continues to hamper consumer confidence and business travel remains subdued.

Macro micro environment on automobile industry

Individual consumers will need the rental service for issues such as tourism, car accidents and theft. Enterprise in particular has aimed to ensure that one of their outlets exists in every major airport within the UK. Identifying macro-environment factors will allow for Enterprise to take advantage of potential opportunities and minimize the risks that may face them.

Macro-environment factors that can influence the operations of Enterprise and other car leasing firms include political, economic, social and technological PEST forces. Other political and legal factors that can affect Enterprise include issues such as MOT and car insurance.

For every automobile within their UK fleet, Enterprise will have to pay a considerable amount to ensure all their vehicles are safely equipped and insured for consumers and businesses to use. Enterprise, also did not expect such a negative period during the Olympic Games. During this period, car rental transactions significantly reduced whilst Enterprise continued to expand their fleet meaning that supply began to exceed demand.

The company has been successful in doing this by providing low-emission automobiles to hire at their outlets. The purpose of the scheme is to ensure that hourly rates will reduce the number of cars on the road.

However, whilst it is clear that Enterprise cares for this social factor, they are also affected by other factors such as population trends and the income of their customers.

For example, an Enterprise outlet in a business area will have a fleet of cars for just business use whereas an outlet in an airport will have a fleet of cars suited for large families and travellers. However, even with their notable power, Enterprise still has to ensure that similar to legal issues such as tax they have safely equipped all their vehicles that they lease to consumers.

Safety is a key factor for all car rental companies, as a noted problem from the car of a rental company can gain significant bad press and hinder the chance of attracting potential customers. The model consists of the threat of entry, the threat of substitutes, the power of buyers, the power of suppliers and competitive rivalry.

Enterprise are not only affected by existing competition Europcar and Hertzbut also the threat of new companies entering the industry.


Barriers to entry however can help protect Enterprise from new companies entering the industry. In relation to the power of buyers, fortunately, Enterprise benefit from being the leading player in the car rental industry.

Enterprise however, have been steadily able to expand their fleet even during the negative economic climate in Enterprise is also known for its customer satisfaction as many of its customers favour the company for the various locations of their rental outlets, the quick reservation and pick-up process and the affordable rates of the cars available in comparison to other competitors.

Another strength that Enterprise has is the location of their rental outlets as the addition of Belfast Airport inensured that the company had a branch at every major UK airport thus making it the largest airport network in the UK.

This programme also acts as an opportunity to enhance the CSR of Enterprise as the company now allows for consumers and businesses to hire affordable and environmental friendly vehicles. Operating on a worldwide scale also means that Enterprise is not only subject to the fluctuations of the UK economy, but also the economy of many other countries.consists of the micro-environment and the macro-environment.

The forces close to the organization that affect its ability to serve its customers is the micro-environment (Kotler, et al, ). How the Macroeconomic Environment of the Airline Industry Affects the Strategic Decision of Boing Vs Airbus - A Case Study - BA Christian Uwagwuna - Elaboration - Business economics - Business Management, Corporate Governance - Publish your bachelor's or .

Lastly, the cultural environment, or institutions and other forces that affect society’s basic values, perception, preferences, and behaviors, too has affected the auto industry, specifically consumer shift toward more environmentally friendly vehicles. The factors that affect the automobile industry are; Laws and regulations have always affected the automobile industry.

The laws and regulations are normally brought up around the environmental measures that are meant to be fulfilled by any automobile industry. Political-Legal Environment Affecting the Economy of an Industry Pages: 2 Words: Political- legal environment is one of the economic environment that its development has strongly impacts on the marketing decisions of the company.

For example, it becomes a technological change for the automobile industry to produce vehicles which consume less petrol in view of the ever increasing prices of petrol. Only that company will be able to survive which can move with the changes taking place in the environment.

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