The globalisation of the business environment has companies facing several
enormous challenges, the most important of which being internationalisation,
market maturity and increased customer power.
Developed countries still represent the most important markets for most of the
large MNCs. These markets, however, are becoming increasingly mature and
saturated. More often, the markets are characterized by over capacity, low
margins and lack of growth, as well as shorter product life cycles. This means
that the competition is becoming more intense, and companies can grow
primarily at the expense of the competitors.
However, since slightly more than 10 years ago, after serious large-scale
political changes in the world, new markets, which used to be quite closed for
western companies, attracted the attention of the global investors and big
multinationals. Eastern European, former Soviet countries’ and Chinese
economies appeared to be in need of investments and assistance to revive or
save their economies.
To some, new opportunities promised benefits, to others, required investments
were associated with uncertainty and risk.
China with its population of 1.2 billion looked as an attractive market, but was
China able to match with the foreign offer? Doing Business in China is not
similar to they way they do it in Western or Eastern Europe, Northern and
South America, and not even similar to Japan and other Asia and Pacific
countries. Historical and cultural facts playing a most important role in the
formation of country’s business practices is still a mystery for many western
businessmen.
Realising the existence of differences and uncertainty, unpredictability of many
factors, risks etc., a number of foreign companies entered this country for
business purposes and many of them have succeeded.
In this work we aim to study the foreign companies operating in China. Among
other foreigners, automobile companies seem to carry on their business
successfully. This sector is one of the most rapidly growing in China, and
China is one of the countries keeping stable pace of growth when the other
markets decline.
By the case study of Volkswagen and General Motors, we in this work, tried to
describe strategies of this companies ...
