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5 Forces analysis for the automobile manufacturing industry Free Essay, Term Paper and Book Report

As defined in the text, an industry is "A group of firms producing products that are close substitutes.” Toyota belongs to the automobile manufacturing industry. Firms that are included in this industry are Volkswagen, Daimler, Ford, Honda, Nissan, and Mitsubishi. I would exclude all firms committed to auto service and maintenance of vehicles after delivery from the auto industry classification. This would include repair shops like Phillips 66 and Jiffy Lube. Threat of new entrants is low due to barriers to entry. This makes it difficult to enter the market and helps restrict competition. There are multiple barriers that make it hard for new entrants to the market. One barrier is the high amount of capital needed to purchase necessities, such as equipment, materials, manufacturing plants, and to hire and train employees. There is also a high amount of capital needed for the innovative technology required to stay competitive within the industry. New technologies have to be utilized to compete and improve automobiles for consumers. Another barrier for new ent......

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