Business Environment in Essay Example | Topics and Well Written Essays - 2500 words

Business Environment in - Essay Example This paper focuses on external factors. Britain has increased regulations to the car industry. The automotive industry is being subjected to huge trade taxation. Political factors influence the strategic plans of Volvo Corporation because the government laws and regulations are strict on the production of environmental friendly cars. As a result of the environmental issues, the corporation has to adhere with the regulations that aim to lower the pollution. Non-compliance with the politically influenced changes attracts huge fines that are costly to the company. Politics has also cautioned the industry against manufacturing of many automated motors. Automation will take up the local jobs leading to unemployment (Henson 2009). There are always fluctuations in fuel price. The economic condition affects its performance as it has to reduce its rate of motor production. As a result of the high fuel prices, customers are now opting fuel efficient cars. The need for the fuel-efficient cars among Britons leads to low sales of the luxury cars that tend to consume more fuel. The constant population also reduces the number of people purchasing cars. The social factors that alter the business are affecting its profits immensely. Customer’s preference is shifting from large luxurious engine cars to small cars because of low carbon emission levels, increase in fuel prices, and above all, the state’s tax free and parking incentive for those who purchase eco-friendly cars. Consumer tastes are also affecting the operational cost planning of Volvo Motors Corporation. Customers are continually demanding safer and better quality cars at very low prices. The situation is forcing Volvo Corporation to get resources and ways of production such as outsourcing its parts from far away countries such as China (Henson 2009). Other motor production companies such as Toyota continue to occupy a large share in the market. The companies have adopted and implemented new and