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Case Study

Invest or not? Does a fuel-efficient car make sense today?

By Ulrich Steger, Andreas Manhart, Oliver Salzmann, Carl-Otto Gensch and Rainer Griesshammer

7 pages

September 2005

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Reference: IMD-2-0118

Lars Eklund, CEO of Autostar, a (fictional) Nordic automotive company is seriously considering the introduction of a fuel-efficient car into the European market. His final decision has to take into account various factors such as a stagnating market growth, pressure to earn cost of capital, a trend towards more powerful engines and more customization, rising and volatile fuel prices, and regulatory pressure to reduce emissions. In a situation, in which some competitors are actually intending to withdraw their models (e.g. Volkswagen the Lupo 3L), and others already successfully occupy their niche (Toyota with their Prius model), does it make sense to go for a market introduction? If yes, how can Eklund do it most effectively?

Keywords

Fuel-efficiency, Corporate Sustainability, Automotive, Corporate Sustainability Management

Settings

Automotive
Mid-2005

Type

Generalized Experience

Available Languages

English

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