Strategic Recommendations for Mercedes-Benz Market Presentation in Thailand: Economic and Trade Analysis
Overview
This paper presents three strategic recommendations for Mercedes-Benz's market positioning in Thailand, analyzing macroeconomic factors including current account balance, currency depreciation, and supply chain vulnerabilities. The analysis examines how pandemic-related economic downturns, Thai baht structural support, and manufacturing industry dependencies impact Benz's export-import operations and market strategy.
What this coursework covers
- Strategy 1: Current account balance risks from economic downturn and supply chain disruption affecting exports and imports
- Strategy 2: Thai baht currency support and structural factors influencing exchange rates against the US dollar
- Strategy 3: Manufacturing industry dependency on Mercedes imports and tourism sector impact on currency valuation
Preview
Strategic Recommendations for Benz Presentation in Thailand
Student Name
Institutional Affiliation
Course Full Name
Professor Full Name
Due Date
Strategic Recommendations for Benz Presentation in Thailand
Strategy 1
A downturn in Thai's economy and supply chain could put Mercedes Benz's exports and imports at risk because all these things directly affect Benz's current account balance. The Thai baht value was expected to fall during the pandemic since the account surplus narrowed because the coronavirus influenced Thailand's long-term financial position (Muthitacharoen & Burong, 2021). Net exports of goods and services and revenue transfers from other nations make up most of the company's account deficit. A surplus on the side of the current Benz account needs to be constant, as it has been since 2014. Because of the importance of Thailand's tourism industry to its economy, exports outstrip imports.
Strategy 2
The next strategy is having structural support for the Thai baht because Thai exporters and foreign visitors purchase more of the currency than they are selling. Besides the lack of pressure on the Thai baht, outbound direct and portfolio investments were also slow to leave the country, which needs to be looked into (Kuzucu, 2018). Since the coronavirus epidemic is a one-of-a-kind occurrence, Benz should expect the Thai baht will depreciate against the US dollar.
Strategy 3
In February 2020, Thailand's manufacturing industry, which is significantly reliant on Mercedes production inputs, was expected to start feeling the pinch from this dependency on Mercedes imports.