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Assignment Instructions – MUST RECEIVE A TURNITIN SCORE OF 25% OR LOWER
Complete a Research Project 2 in a Word document, APA formatted, must be completed by 7/29/2017
6:00pm EST.
In 2009 the American auto industry was in a dire economic state. Chrysler was in Chapter 11, GM was
on the brink of bankruptcy, and Ford’s future was at best uncertain. The demise of the U.S. auto industry
would have a devastating impact on our national economy and specifically the economies of Michigan
and Ohio.
Economists occasionally use Porter's five forces framework when making a qualitative evaluation of a
firm's strategic position. According to Porter, his model should be used at the industry level, defined as a
marketplace in which similar or closely related products or services are marketed. This research paper
requires the application of Porter’s Five Forces Model to the auto industry.
Porter's analytical framework consists of those forces that affect a producer’s ability to serve its
customers and make a profit. A change in any of these five forces requires a re-assessment of the
marketplace. The five forces include:
1) The threat of substitute products: The existence of close substitute products (i.e., high elasticity
of demand) increases the propensity of customers to switch to alternatives in response to price
increases.
2) The threat of the entry of new competitors: Unless there are significant barriers to entry, profitable
markets that yield high returns will attract firms (i.e., perfect competition), effectively decreasing
profitability.
3) The intensity of competitive rivalry: As in the case of oligopoly markets, rivals may choose to
compete aggressively, non-aggressively or in non-price dimensions.
4) The bargaining power of customers: The ability of customers to put the firm under pressure due to
availability of existing substitute products, buyer price sensitivity, uniqueness of the products, etc.
5) The bargaining power of suppliers: The cost of factors of production (e.g. labor, raw materials,
components, and services such as expertise) provided by suppliers can have a significant impact on a
company's profitability. As such suppliers may refuse to work with the firm or charge excessively high
prices for unique resources. References
Porter, M.E. (1979) "How competitive forces shape strategy", Harvard Business Review, March/April
1979.
Porter, M.E. (1980) "Competitive Strategy", The Free Press, New York, 1980.
Porter, M.E. (1985) "Competitive Advantage", The Free Press, New York, 1985. Develop a detailed paper applying Porter’s Five Forces Model to the American automotive industry.
Your paper needs to include at least three scholarly sources, i.e. peer reviewed articles. I strongly
recommend the use of the APUS library for these sources, as most acceptable resources can only be
found in protected databases.
Your paper should be about 10 double spaced pages, in APA format, and structured as follows:
1.
2.
3. Cover page with a running head
Abstract
Introduction to the Auto Industry
3.1.
Industry Definition
3.2.
Industry Profile
3.3.
Industry Market Structure
3.4.
Future Outlook 4. Porter's Five Forces Strategy Analysis as it applies to the Auto Industry
4.1.
Bargaining Power of Buyers
4.2.
Bargaining Power of Suppliers
4.3.
Competitive Rivalry in the Industry
4.4.
Threat of New Entrants
4.5.
Threat of Substitutes 5.
6. Conclusion
References ECON 600 Research Project 2 Rubrics Criterion
15% Identification of
auto Industry Unsatisfactory Satisfactory Did not fully identify Identified the
the auto industry
auto industry
structure.
structure
correctly.
0-5
6-10 Exceptional
In addition to meeting the
requirements
of satisfactory, provided an
analysis of market structure
requirements including
number of firms,
uniformity of products,
ease of entry and exit.
11-15 Score 15% Identification of
Porter’s Five
Forces Did not identify all
five forces.
0-5 Identified all five In addition to identifying all
forces.
five forces provided the
detail for relating them to
6-10
the requirement of market
structure.
11-15 25% Identification of
Application of
Porter’s Five
Forces to auto
industry Did not clearly
identify an
appropriate
application of each
concept identified in
the scenario.
0-10 Clearly
identified an
appropriate
application of
each concept
identified in the
scenario. In addition to meeting the
requirements
of satisfactory, discussed at
least one future
opportunity.
20-25 11-19
10% Demonstrate
Critical Thought
in Analyzing
Information Does not
demonstrate critical
thought in the
analysis of the
information, or
analysis is disjoint
0-4 Demonstrates
critical thought
in analyzing the
information by
presenting
various
perspectives on
the concepts
5-8 In addition to meeting
requirements
of satisfactory,synthesizes
information across
concepts effectively.
9-10 In addition to meeting the
requirements
of satisfactory, the paper is
engaging to the reader with
concise and clear
communication.
10-15 15% Demonstrate
Quality and
Effectiveness in
Written
Communication Written
communication is
ineffective, with
numerous spelling
and grammatical
errors or poorly
constructed
sentences.
0-4 Written
communication
is effective. 10% Adhere to APA
Writing Style
Requirements Numerous errors in
format, style, or
reference citation
0-3 Few errors in
format, style, or
reference
citation.
4-7 5-9 Virtually no errors in
format, style, or reference
citation.
8-10 10% Length
Requirement Outside of specified
range by more than
10%. 1-4 Outside of
specified range
by 10% or less. Within specified range.
10 5
Turnitin
Percentage Conformity
Percentage greater
than 35%, excluding
bibliography. Grade
discounted up to
50%. Conformity
Percentage
between 20%
and 35%,
excluding
bibliography.
Grade
discounted up
to 30%. Conformity Percentage
smaller than 20%,
excluding bibliography.
Perfect.