AB Volvo Case Study

AB Volvo diversified into areas outside of its core business (car manufacturing) in order to help protect itself from the vagaries of the car market. This diversification can first be traced to a diversification in geographic marketing, with the company entering the European and then international markets with its cars. Such diversification helped to protect AB Volvo against potential weaknesses in any one geographic auto market. The diversification into foods represents another move by the company to protect itself against downturns in any one area. Where the international auto market is influenced by economic conditions, oil prices and recessions, the

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ge. Opportunities Because of AB Volvo's size, there are a number of areas which could be considered opportunistic for it. However, the most attractive opportunities come from its core businesses, with expansion of its trucks, bus and car marketing having particular allure. AB Volvo has successfully built a strong market for its products in these areas and in the related area of engine production. It has been less successful in entering the food industry. Continuing to emphasize luxury cars in the United States will help the company take advantage of the aging baby boomers, whose incomes are steadily rising along with a demand for luxury items, and maintaining a presence in the engine market gives the company the opportunity to build on its strengths in terms of marketing and production. Threats AB Volvo has been successful in the United States to the point that much of the company's revenue comes from its sales in America. Despite this, the company is not planning additional market penetration, but is instead encouraging only natural market growth. The logic behind this strategy is that the American car market is a highly competitive one with many imports competing against many domestic models. To build and maintain mar
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Approximate Word count = 2009
Approximate Pages = 8 (250 words per page)