DaimlerChrysler and the Economy
DaimlerChrysler is one of the world's leading automotive companies, providing customers with a wide range of products ranging from subcompact cars to full size trucks. The minivan is one of DaimlerChrysler's top selling vehicles; however in today's competitive environment, they are slowing losing there share of the market. It is important for DaimlerChrysler to remain competitive. In the following paragraphs, the importance of product pricing will be discussed, as well as the importance of analyzing the costs and market structure in which it exists. Economic forecasts and indicators will be used to help determine the effects of changes in the economy on demand for minivans.
Individual Product Pricing Component
Competition has played a major role in the minivan market segment. Through diffusion, almost every automaker has a version of the minivan available. As of 2004, there are 17 models on the market today, ranging in price. Dodge strategically produces 3 models to cover most consumers' wants and needs. With consumers having there choice of minivans, a substitute for the Caravan is readily available so DaimlerChrysler must competitively price their minivan. Below is a chart that shows the Caravans direct competition and indicates where DaimlerChrysler is compared with in pricing terms With competition being a major issue that affects demand and price is competition, the more strategic the pricing needs to be. DaimlerChrysler has to be sure to price according to other vehicles or consumers will chose the competition.
With DaimlerChrysler's three categories in the minivan segment, they are priced quite competitively.
Kia Sedona $19,908
Dodge Caravan $20,203
Mazda MPV $21,720
Chevrolet Astr ...