The tire business is becoming increasingly competitive as ne

The tire business is becoming increasingly competitive as new manufacturers from Southeast Asia and elsewhere enter the global marketplace. At the same time, customer expectations for performance, tread life, and safety continue to increase. An increasing variety of vehicles, from the small and innovative gas/electric vehicles to the large SUVs, place more demands on tire designers and on tire manufacturing flexibility. Established brands such as Goodyear and Firestone must look to new ways to compete and maintain profitability.

Required:

1. Is the competitive strategy of a global tire maker cost leadership or differentiation? Explain your answer.

2. What are the ethical issues, if any, for tire manufacturers?

Solution

1.1. Is the competitive strategy of a global tire maker cost leadership or differentiation? Explain your answer.

Differentiation can be seen as the competitive strategy of a global tire maker. This is taken as differentiation as it is quite important for the manufacturers of tires to produce the products which are good in design, have superior quality and different from the competitors. A better name in the market has been created by the Global tire competitors, such as Goodyear and Michelin, through their excellent product quality and better customer services. Other reason for choosing the differentiating strategy is that there are greater number of competitors in this industry so the players in this industry are required to have their product different from the competitors.
2. What are the ethical issues, if any, for tire manufacturers?

a safe working environment, making sure the tires are tested and safe, and trying to reduce the companies’ energy/effect on the environment can be seen as some of the ethical consideration in this industry.