Honda_Macro_Environment

“Outline the components of any organisation’s macro environment, and give an example for each component of a current major operational change or industry trend.” I have decided to elaborate on the macro environment of Honda Motor Company, Australia. Honda Australia’s head office was established in Tullamarine in 1981, and currently employs up to 140 staff. They are one of the leading importers and retailers of vehicles in Australia. The macro environment has significantly impacted Honda Australia. Shown below; I have used the PESTL method of evaluating Honda and some it’s major operational changes. Political Factors Exchange rates and oil price inflation – In 2002; Honda began manufacturing some of their models in Thailand to minimise costs. Originally all Honda models were manufactured in Japan. This significantly helped Honda to offer vehicles in Australia at affordable pricing; and to keep up with their competitors. Economic Factors- Fuel price fluctuations – The cost of fuel in Australia has risen in recent years. Cost and environmentally conscious customers have shown less interest in the premium sports and luxury cars in the range as they cost more to run. In 2004, Honda Australia introduced the Honda Civic Hybrid to the market; and discontinued importing their only rear-wheel drive sports car; the Honda S2000 in the beginning of 2009. Social Factors Consumer Attitude – Consumer attitude plays a role in selecting cars. Based on Honda’s target market; they are aimed at selling vehicles to the growing families of Australia. During the Global Financial Crisis, consumer attitudes changed. Sales in locally produced cars such as Holden and Ford increased as people were determined that this was keeping manufacturing jobs here in Australia. Technological Factors Hybrid Vehicle Implementation – Technological factors of Honda are very advanced when compared with their competitors. Honda Australia began importing their first innovative Hybrid model to the Australian market in 2001. By designing cars with electric engines, this showed that Honda was a green and environmentally conscious company. Legal Factors The Australia Design Rule specifies that all new vehicles sold in Australia must meet the correct safety standards. Manufacturers must meet these standards by offering the front seat occupants protection to their head, chest and upper legs in the event of an accident. Honda Australia now only imports models with 2 or more front airbags; as well as offering ‘Safety Packs’ where additional airbags can be installed upon the buyers request.