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Research on Market Entry Strategies of BMW
Table of Content
1. Introduction 2
1.1 Background of the research 2
1.2 Objectives of the research 3
2. Literature review 3
2.1 Marketing theory 3
2.1.1 Marketing 3
2.1.2 Marketing Mix 4
2.2 Diamond Model Framework 6
2.3 Porter's five forces model 7
2.3.1 The power of suppliers 8
2.3.2 The power of buyers 8
2.3.3 Threat of substitutes 8
2.3.4 Threat of new entrants into the market 9
2.3.5 Competitive rivalry 9
2.3.6 General comments on the analysis 9
2.4 Era of foreign joint ventures 10
2.4.1 Global automotive industry development 10
2.4.2 Current conditions in China after WTO entry 13
2.4.3 Development of foreign joint ventures 14
2.4.4 Forecasted development in China's automotive industry 15
2.5 Firm focus (www.bmw-brilliance.cn) 18
3 Research Methodologies 20
3.1 Research consideration 20
3.2 Research information source 20
3.3 Secondary research 21
3.4 Primary research 21
3.3.1 Method of questionnaires 22
3.3.2 Method of interviews 26
3.5 Research limitation 30
4 Findings 31
4.1 Status quo of BMW in China 31
4.2 BMW’s competitiveness in China’s market 33
4.2.1 Diamond analysis 33
4.2.2 Porter’s five forces analysis 38
5. Discussion 39
5.1 Market environment for BMW in China 39
5.1.1 Changes in legal documents & industry policy 39
5.1.2 Changes in organization structure 40
5.1.3 Changes in product mix or product structure 41
5.1.4 Changes in technology regulations 42
5.2 Problems with automobile industry in China 42
5.2.1 Globalization 42
5.2.2 Foreign cooperation 43
5.2.3 Environmental protection & City construction 44
5.3 Steps and procedures necessary for BMW to undertake 44
5.3.1 Product structure 44
5.3.2 Technology update 45
5.3.3 Industry corporation 45
6. Conclusion 46
Appendix 51
Bibliography 53

1. Introduction
1.1 Background of the research
Automotive industry as a whole has long been a focal interest of many countries in their path to industrialization. Most developed nations including the United States, United Kingdom, Germany and Japan have all gone through this phase of automotive induced industrialization and this is what China is presently experiencing. The thesis deals market entry strategies of foreign automobile manufacturers into China after its WTO entry.

With China's entry into WTO in December 2001, it is undergoing an unparalleled revolution. What WTO brings to Chinese car market is lower tariff rates, more investment and fairer market competitions. In other words, a completely open market will occur in due time. Facing this big challenge, China’s car industry is adjusting itself to WTO commitments during the buffer period of 5-6 years that is granted to this industry. Thanks to these positive measures taken by China's car industry, the first two years after China's accession to WTO witnessed dramatic changes in domestic car market: car price slash and reorganizations between automakers. They are both outcomes market competition.

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