Isuzu Motors SWOT and PESTLE Analysis

Strength

This section is available only in the 'Complete Report' on purchase.

Weakness

This section is available only in the 'Complete Report' on purchase.

Opportunity

1. Leveraging Telematics business as a game changer for trucks business: Telematics has undergone a few changes since first appearing on the scene. Having evolved from a minimal supporting role to providing major value-added to drivers, owners, and OEMs, telematics establishes entire new revenue streams within reach. OEMs have generally focused on two core revenue streams from automotive telematics, Vehicle price mark-up and Telematics subscriptions. But with so much of data available and the potential use of that data, even more is possible. Future competitor’s business models might focus on services rather than the truck itself. In 2024, the global telematics market may total up to $20B US, with Europe accounting for the largest share. Increasing connectivity and piling cost pressure in the transportation business are the main drivers for this growth. In a competitive market, a truck’s efficiency increasingly becomes the most important buying criterion for the customer. To win the market against often cheaper aftermarket organizations, Isuzu must offer complete solutions. Isuzu need to lever their existing competitive advantage in trucks diagnostics while developing independent business models, that require integrating different skill sets from outside the organization.

2. Need for alternative drive systems: Tighter exhaust gas regulations and access restrictions for diesel vehicles in the coming future, especially in large cities, the demand for bigger investments in alternative drive systems, while simultaneously opening up new sales opportunities. Deloitte developed a market model which shows that about 13% of new vehicles (MCV + HCV) in the key German market will already have an alternative drive system by 2026. In MCVs, there is a trend leaning towards plug-in hybrids (67% vehicles will have alternative drive systems vehicles by 2026). For long distances, nearly 80% of HCVs with alternative drive systems will be running on natural gas (LNG + CNG). Isuzu can very well gauge these upcoming opportunities and prepare itself accordingly to stand against its competitors and also can cash in on first movers’ advantage if they take actions in this direction.

3. Enhancing product lines: It has been a very long time that Isuzu has been dependent on their traditional products of commercial vehicles and diesel engines. Keeping up with the needs of the customers, it will definitely be a plus if they can further increase their product portfolio and deep dive in existing segments like buses. They can also focus on enhancing the existing product line by adding new features in their existing products or coming up with new models of their existing products. Almost all competitive players are venturing into hybrid and pure electric vehicles, though this field is still naive and challenging in heavy automobile space but surely possesses scope for future product development. They need to strengthen their LCV business which is in alignment to customer’s demand. they need to improve their product and sales strategies by going for new product development and focus on sales in middle east and Africa. New product development should be consistent with environmental regulations related to fuel efficiency and safety features.

4. Enhance powertrain business: Isuzu Philippines Corporation (IPC) launched the first of its kind diesel engine line-up to power industrial, marine and automotive applications as a new business venture on August 19,2009 as a response to the Clean Air Act, the government's guideline for anti-air pollution and is expected to fulfil the requirement for brand-new, powerful and environment-friendly engines for boats, light trucks and buses. They can further expand this business to other countries like China and establish a base there because the demand for such engines is gaining popularity.

Threat

This section is available only in the 'Complete Report' on purchase.

Political

This section is available only in the 'Complete Report' on purchase.

Economic

This section is available only in the 'Complete Report' on purchase.

Social

This section is available only in the 'Complete Report' on purchase.

Technological

This section is available only in the 'Complete Report' on purchase.

Legal

This section is available only in the 'Complete Report' on purchase.

Environmental

1. Trend for increasing safety norms and environment laws: The level and stringency of environmental laws in the United States and other geographies that Isuzu Motors operates in are not the same and they need to meet all those laws and regulations. Health and safety norms are also rapidly changing and to meet these norms brings in additional cost which needs to be taken care of. Isuzu has taken many initiatives to respect such concerns. They have stated that environmental problems are key business issues for the Isuzu Group and clarified that they will pursue environmental initiatives based on their environmental management system. They have identified the key issues for the Isuzu Group’s environmental activities (materiality) and declared intent to exercise proactive disclosure to ensure good communication with members of society. With the regulations regarding emissions becoming stricter with each passing year, it is expected that by 2020, the CV industry in India will also see enforcement of BS-VI emission regulations. All Isuzu buses already follow the Bus Body Code even though the norms are not generally implemented. CNG fuel has also been adopted, making Isuzu buses environment friendly with lesser air pollution and cost effective with economization of fuel.

2. Need for technology favorable for sustainable development: Environmental norms are altering the priorities of product innovation. In many cases the products are required to be designed based on the environmental standards and expectations rather than catering to traditional value propositions. This needs specific focus when going for technology innovations so that these solutions are long lasting in terms of sustainable development prospects. Recycling is the emerging trend now everywhere and Isuzu needs to make plans to adhere to suitable regulations and expectations in the sector. Renewable technology is another interesting area of focus for Isuzu Motors. It can leverage such trends in this sector and additionally, many economies are now providing subsidies and incentives to invest in the renewable sector. Waste management especially for units close to the urban cities is taking increasing importance and governments are setting up strict norms for waste management. Isuzu is focusing on the development of hybrid-electric trucks. These vehicles use a combination of diesel engines and alternative energy resources such as DME (dimethyl ether), CNG and LPG. These are also good for the environment as they emit lower amounts of polluting gases and use the available resources optimally.