Big Drive Auto Data of Volume The Big Drive Auto Company is a major automobile dealer that sells a multitude of vehicles and other services. The company strives to stay abreast of the current economical

Big Drive Auto Data of Volume

The Big Drive Auto Company is a major automobile dealer that sells a multitude of

vehicles and other services. The company strives to stay abreast of the current economical

conditions to stay profitable and competitive. The field of economics that studies the behavior

of the aggregate economy, which macroeconomics examines economy-wide phenomena such

as changes in unemployment, national income, rate of growth, gross domestic product, inflation

and price levels (McConnell, 2009). The company not only sells automobiles, but also sells

auto parts and the offers repair services, along with selling automobile products, such as oil and

tires. Therefore, the company is always researching data and measures to improve on the current

functions of the business and to provide excellent service to stakeholders and customers.

According to the scenario, Big Drive Auto had a steady increase in all aspects of

its business beginning in 1998. There’s been a steady increase in vehicle unit sales, motor

oil, coolant and tires, and service revenue has been on the rise. However, according to the

macroeconomic data of the United States where Bid Drive Auto operates, and the industry data,

the national situation has changed after 2007. Please refer to below chart.

According to the above chart, the national annual growth in the United States has been

declining since 2007. Downturns in durable-goods manufacturing and professional, scientific,

and technical services along with the continued contraction of construction were among the

leading contributors to the decline in U.S. economic growth in 2009, according to revised

statistics on the breakout of real gross domestic product (GDP) by industry from the Bureau of

Economic Analysis. (www.bea.gov). So it is plausible to assume that Big Drive Auto needs to

drastically improve it’s planning and operations in order to avoid the decrease of revenue after

2007.

Big Drive Auto should price the products based on the current average prices of

competing products. The current state of the economy requires business to do extensive

research before establishing prices for their products. If the appropriate price isn’t set, then Big

Drive Auto may lose a significant profit and risk shutting down all operations. If Big Drive

Auto decides to price products above the current average price, then the products will have to

maintain a uniqueness that will be worth the additional cost. It is also important for Big Drive

Auto to scan the incentives and penalties, as well as government regulations associated with

the automotive industry prior to pricing. Either way, due to the current economic status of the

automotive industry, Big Drive Auto should be predicting a decrease in sales as per below figure.

Big Drive Auto International Relationship

Big Drive Auto is a company that also works internationally. It is currently trying to

expand into the European market, starting with the United Kingdom. In order to accomplish,

Big Drive Auto will have to consider several factors. First of all, the automotive industry is

facing significant changes in the next several years, with the emergence of the Chinese consumer

and new manufactures, the introductions of the $2,500 car and the declining use of autos in the

European marketplace. With decreasing sales, tight credit markets and changes in consumer

tastes, the automotive industry is facing the global auto industry with major players and key

issues shaping performance ( Business Weekly, 2010).

When dealing with the UK auto market, Big Drive Auto will have to consider Britain’s

economic situation, which is not that different from the situation in the United States. According

to UK’s GDP Growth Rate, annual growth rate had a significant dip between 2008 and 2010

below figure

However, there has been an increase in 2010 and then another small dip. So there’s still

potential hope for recovery in relation to the auto industry. Big Drive Auto will have to deal

with certain macroeconomic measures of Great Britain in order to project its sales and price data.

Big Drive Auto will have to consider exchange rates between US Dollars, Euros and Pounds

still used in Great Britain. Also, due to the fact that Big Drive Auto is servicing cars in both

Europe and the US, the company will have to diversify and retool all service and repair parts to

accommodate the multitude of different vehicles that are found both in Europe and the United

States. Perhaps to achieve greater success in the UK market place, Big Drive Auto can focus

on service revenue, by providing parts and service for existing British cars, rather than trying to

sell new ones. By channeling all funds and efforts into that avenue, Bid Drive Auto can provide

cheaper parts and service for British cars, therefore attracting more customers and establishing

Bid Drive Auto as a household name. Below is a graph to illustrate projected parts and service

revenue.

Upon creating a solid market within the United Kingdom, the economy should be entering a

growth stage. Consumers will be ready to purchase more vehicles. At that point, Big Drive Auto

can expand to vehicle sales within the United Kingdom. The company will want to concentrate

on vehicles sales to both individuals and businesses. Big Drive Auto will want to make sure

that it maintains an excellent service component so that when the economy has another future

downturn, BDA will have a good reputation in place. That way they will still be able to retain

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