The VW Resende Modular Consortium Essay Example | Topics and Well Written Essays - 3000 words - 1

The VW Resende Modular Consortium - Essay Example This essay discusses that  VW’s strategy of manufacturing trucks in Brazil could be defined as a Focus Strategy. Under a focus strategy the firm concentrates on one or a limited range of segment of the market. Thus did VW, by focusing its manufacturing process on trucks. Working in the automotive industry throughout the world, VW has made a decision to focus mainly on one segment of the automobile industry in Brazil. It was a truck production sector. While this strategy was different from the overall company strategy, VW had to act in a way that best fitted the organization’s competitive environment in Brazil. The company benefited from its specialization on truck segment by gaining strong competency in the production of trucks and some of their modules.  This paper highlights that  by going deeper to the Porter’s focus strategy, it is possible to assume that the VW’s Resende Modular Consortium was more closely related to the cost leadership focus. C ost leadership as a generic strategy does not imply that the company will market the lowest price product or service in the industry.  The main goal of the cost leader is to secure a cost advantage over its rivals, price competitively and relative to how its product is perceived by the customers and achieve a high profit margin.   By adopting cost leadership focus strategy on the Brazilian truck market, the VW Company was striving to satisfy its customer’s needs with up-to-date technologies and trucks of the highest quality of relatively low prices.