Competitive Dynamic   Tesla has recently announced that the will be cutting prices on their cars by up to 20%. Analyze the likelihood that Ford will respond, and the likely form any response will take.     Using the competitive dynamics model, it is likely that Ford will respond to Tesla's price cut by taking a competitive action of their own, in order to maintain their market position and market share.   In terms of the likely form of response, Ford may choose to respond with its own price cuts, in order to remain competitive with Tesla in the electric car market. Alternatively, Ford may focus on improving the quality and features of their cars, rather than simply competing on price, in order to differentiate themselves from Tesla's models. This could involve investing in research and development to improve the performance and functionality of their cars, or focusing on customer service and creating a better overall customer experience.   It is also possible that Ford may respond by taking strategic actions, such as entering new markets or developing new product lines. For example, Ford may choose to focus on developing hybrid or hydrogen fuel cell cars, rather than purely electric cars, to differentiate themselves from Tesla and appeal to a different segment of the market.   Overall, it is likely that Ford will respond to Tesla's price cut in some form, whether through price cuts of their own, focusing on differentiation, or taking strategic actions. By doing so, Ford can aim to maintain their competitive position in the electric car market and gain a larger market share.       Questions: Write one page In what ways does the following response misunderstand or misapply the analysis of competitive dynamics and/or our foundations of strategy? What (if any) important analytical steps does the following response skip, or fail to do in enough detail?

Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
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Competitive Dynamic
 
Tesla has recently announced that the will be cutting prices on their cars by up to 20%. Analyze the likelihood that Ford will respond, and the likely form any response will take.
 
 
Using the competitive dynamics model, it is likely that Ford will respond to Tesla's price cut by taking a competitive action of their own, in order to maintain their market position and market share.
 
In terms of the likely form of response, Ford may choose to respond with its own price cuts, in order to remain competitive with Tesla in the electric car market. Alternatively, Ford may focus on improving the quality and features of their cars, rather than simply competing on price, in order to differentiate themselves from Tesla's models. This could involve investing in research and development to improve the performance and functionality of their cars, or focusing on customer service and creating a better overall customer experience.
 
It is also possible that Ford may respond by taking strategic actions, such as entering new markets or developing new product lines. For example, Ford may choose to focus on developing hybrid or hydrogen fuel cell cars, rather than purely electric cars, to differentiate themselves from Tesla and appeal to a different segment of the market.
 
Overall, it is likely that Ford will respond to Tesla's price cut in some form, whether through price cuts of their own, focusing on differentiation, or taking strategic actions. By doing so, Ford can aim to maintain their competitive position in the electric car market and gain a larger market share.
 
 

 

Questions: Write one page

  • In what ways does the following response misunderstand or misapply the analysis of competitive dynamics and/or our foundations of strategy?
  • What (if any) important analytical steps does the following response skip, or fail to do in enough detail?

 

Expert Solution
Introduction

Competitive dynamics is a crucial concept in the field of strategy, which involves analyzing the actions and reactions of firms within a particular market or industry. This model helps to understand how companies respond to each other's strategies, and how these responses can shape the competitive landscape. In this context, this essay examines a response to the announcement that Tesla will cut prices on its electric cars by up to 20%. The essay evaluates how this response misunderstands or misapplies the analysis of competitive dynamics and the foundations of strategy. It also explores the analytical steps that the response skips or fails to do in enough detail.

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