Porter's diamond 5 forces : Stellantis, an automotive company

Angela L.

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Porter's diamond 5 forces : Stellantis, an automotive company

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Themes

5 forces de Porter, Stellantis, Chrysler, Dodge, Jeep, Opel, Citroën, DS Auto, Peugeot, Vauxhall, Alfa Romeo, Fiat, Lancia, Maserati, main shareholders, areas of activity, digitalization, globalization, health crisis, public transport, electric cars, innovations, competitiveness, Renault, Toyota

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Abstract

Stellantis is an automotive company founded very recently, on January 16, 2021. It is the result of the merger of car manufacturers FCA and PSA. It is, therefore, a global manufacturer that brings together more than ten brands (Chrysler, Dodge, Jeep, Opel, RAM, Citroën, Abarth, DS Auto, Peugeot, Vauxhall or even Alfa Romeo, Fiat, Lancia and Maserati).
In 2021, when it was created, the group had more than 300,000 employees in more than 30 countries and in more than 130 different markets. The main shareholders of the group are EXOR with 14.4%, Peugeot 1810 with 7.2%, as well as Bpifrance with 6.2%, and Dorgfeng who own 4.5%. It should also be noted that the group's worldwide turnover in 2021 amounted to 167 billion euros. However, the company experienced a rapid drop in production, of around 600,000 cars for the year, with global deliveries falling by 27%.

Introduction
1. Stellantis
2. Porter's 5 Forces
Porter's 5 Forces of Stellantis
1. Threat of new entrants
2. Threat of Substitute Products
3. Bargaining power of customers
4. Bargaining power of suppliers
5. Intra-industry competition
6. Summary table
Conclusion and strategic recommendations

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[...] With the internet, the real danger for groups like Stellantis is when they get too many negative reviews, this impacts the number of sales in the long term. Today, before buying a vehicle, or anything else for that matter, customers look at reviews, compare, and get informed, which forces groups to always be more efficient. D. Bargaining power of suppliers Stellantis is a company that works with a very large number of suppliers in all its fields of activity. There are new collaborations every year, especially since electric vehicles are developing. [...]

[...] Whether due to digitalization, globalization or, more recently, the health crisis. All manufacturers have radically changed their marketing strategies in order to be ever more competitive. B. Porter's 5 Forces In the following document, we will study the Porter forces of the Stellantis group. This strategic analysis tool makes it possible to better understand and, therefore, analyze the development of the company in its market. It is also about understanding the competition and the threats that may at some point weigh on the company. [...]

[...] Summary table Porter Forces Threat Intensity New Entrants Weak Substitutes Weak Supplier Power Moderate Customer Power High Competiiton High III. Conclusion and strategic recommendations Stellantis is, therefore, a relatively strong company, which has undeniable assets as well as powerful opportunities for the future. Porter's strengths show that the most dangerous threats to the company lie above all at the level of competition, which is very high, as well as the power of customers, which is very much linked to this competition. [...]

[...] Of course, the importance of suppliers should not be minimized because they are essential to the company. Indeed, they guarantee the good quality of the products and some of the services and therefore play an obvious role in customer satisfaction and in the group's turnover. Being the supplier of a group like Stellantis ensures long-term contracts when everything is going well, hence the need to establish relationships based on partnership and trust and not on the power of the one or the other. [...]

[...] The fact that there are numerous competitors would also force new entrants to establish a strategy based on both Stellantis' methods as well as those of the competitors. This is difficult to achieve for a company that has just arrived in the market sector. There are far too many things to do, especially as we have witnessed, for several years, the rise of alliances between several manufacturers, which further strengthen their position. This is exactly the case with Stellantis, which has formed alliances with several manufacturers. [...]

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