Navistar Case Study

Navistar is a leading manufacturer of trucks which has recently returned from a series of difficult financial years. The company participates in a limited manner in international marketing, but has demonstrated, through a strategic relationship with U-Haul, that it can work with customers to understand their needs and develop products which can profitably meet those needs. Faced with increased international and domestic competition, Navistar has the opportunity to expand its international presence and to build a reputation not only as a supplier of trucks, but as a strategic business partner with its customers.

Navistar is the nation's leading manufacturer of trucks used in commercial service. It competes with six other major manufacturers, including a combination company consisting of Volvo and General Motors. Although Navistar is by far the largest truck manufacturer, it has suffered significant financial difficulties in the past and has only recently returned to profitability.

At this point, the truck manufacturer industry as a whole and Navistar in particular face challenges including international marketing opportunities (as well as international competition) and decreased profit margins on their product offerings. In the larger classes of trucks, it is difficult to produce a single truck which can meet the specific needs of all customers, so there is an increased tendency to "built to order" products; this trend also decreases profita

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a regional (western hemisphere) presence, or remain primarily an American participant. At this point, the company has made some effort at international marketing, but this has not been a primary focus of the organization's efforts. Navistar must also determine the type of relationship it has with its customers. Developing close relationships with fleet managers would mean taking more aggressive steps than merely advertising in magazines and at shows, which has a certain cost increase associated with it, but such relationships forge longterm patterns which might prove beneficial to Navistar's longterm growth. At this point, the company has a strong brand presence in each of the eight classes of trucks, which means that companies making purchasing decisions are already familiar with Navistar. In this way, companies who are moving from one class upward to another are likely to move to a company with whom they already do business. Since Navistar currently has the product offering to satisfy this need, this is a potentially strong success factor. However, continuing to develop good product offerings across the entire truck product spectrum requires strong financial resources, and the company is currently not as strong financia

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