Source: E-mail dt. 28.1.2012
Integration of Green Marketing within the automotive industry
R. Lumina Julie
Asst Professor, Dept of Management
Sri Krishna Arts
"The artist is nothing without the gift, but the gift is nothing without work."
GM launched ‘Keep America Rolling’
campaign after the 9/11 attacks with more emphasis on high incentives and low
to zero interest rate loans. Ford offered a free computer along with the purchase
of Ford Focus vehicle. An entry level passenger car was offered along with a
high end Sport Utility Vehicle (SUV)8. In 2004, the
U.S automakers spent nearly US$ 60 billion in rebates and over 90% of the cars
sold had some incentive. But Japanese players were also following suit. In
The modern era is normally defined as the 25 years preceding the current year. However, there are some technical and design aspects that differentiate modern cars from antiques. Without considering the future of the car, the modern era has been one of increasing standardisation, platform sharing, and computer-aided design.
Exemplary modern cars:
Ø 1973–present Mercedes-Benz S-Class — electronic Anti-lock Braking System, supplemental restraint airbags, seat belt pretensioners, and electronic traction control systems all made their debut on the S-Class. These features would later become standard throughout the car industry.'s best selling world cars.
Ø 2008–present Tata Nano — The Tata Nano is an inexpensive(100,000 ~ $2200), rear-engined, four-passenger city car built by the Indian company Tata Motors and is aimed primarily at the Indian domestic market.
GENESIS OF THE AUTOMOBILE INDUSTRY
The genesis of the automobile industry dated back to 15th Century when the famous Italian genius, Leonardo da Vinci suggested the possibilities for power-driven vehicles. Later in 17th Century, the famous English physicist Sir Isaac Newton proposed the concept of a steam carriage which was brought to reality in the late 18th Century by French Army Captain Nicholas- Joseph Cugnot. During the mid 1800s, the attention had shifted to internal-combustion engines which were safer and easy to operate than the steam-driven engines. The first successful version of the internal-combustion engine was built by Jean-Joseph Etienne Lenoir in 185911. This model was revised by a German shop clerk, Nikolaus August Otto in 1876 and hence came to be known as the Otto engine.
The automobiles manufactured in the 1890s were called as ‘horseless carriages.’ This marked the beginning of craft production as all the manufacturing was done by craftsmen employed in metal and machine tool industries. Each car was tailor-made to suit the needs of wealthy customers.
MASS PRODUCTION VERSUS LEAN PRODUCTION IN AUTOMOBILE INDUSTRY
Lean Production is a system of work organization that strives to deliver high quality, low-cost products through the efficient use of resources and the elimination of waste.
Mass production Lean Production
Complete inter-changeability of standardized parts and the simplicity of attaching them to each other
More general resources e.g. multi-skilled workers and general purpose machines, for flexible production.
A standardized product design that enabled production in large batches to achieve economies of scale, coupled with large buffers of inventory stock to prevent any interruptions in production.
Small buffers and lot sizes to facilitate a market strategy of responding quickly to demand fluctuations with a greater variety of product designs.
A centralized hierarchy that controlled and coordinated specialized and narrowly defined tasks.
More decentralized authority with greater lateral communication across functional boundaries, team work, and operators’ participation in quality circles and continuous improvement activities
MARKET TRENDS INDUSTRY STRUCTURE
In the automobile industry, transaction
cost economics, and technology shifts determined the structure (Sako, M). During the 1890s, craft production techniques led
to the formation of horizontally disintegrated industry, completely devoid of
consolidation. Manufacturing units evolved in regions boasting of skilled
labor. By the middle of the 20th Century, automobile companies like Ford and GM
brought about consolidation in the industry. The companies themselves were
vertically integrated. The market was oligopolistic in nature. Huge production
costs deterred new firms from entering the market. GM emerged as the market
leader, wielding high influence over market prices. By 1920s, Ford perfected
mass production techniques. The company also took initiatives for a high degree
of vertical integration by owning its own steel milland
forging factory. Other players followed suit to achieve substantial cost
savings. The integration of Fisher Body by GM marked one such instance. But
contrary to the trend for vertical integration by the
The global automobile industry,
witnessing robust growth in the face of increased global demand, produced
around 63 million motor vehicles in 2004. The Asian countries, mainly by
In the European sector,
With increasing consumer awareness about the negative impact of automobile emissions, auto-manufacturers were readily going for technological improvements, thereby launching new products. These innovations were broadly classified under engine modifications and improved transmissions. Engine modifications were aimed at reduction of pumping losses, reduction in engine friction and improved combustion and some examples included:
Ø Variable Valve Timing (VVT) or Variable Valve Lift and Timing (VVLT) – This was the generic term used for an automobile piston engine technology. The first functional system was developed by Fiat. Honda developed the Variable valve Timing and lift Electronic Control to improve the efficiency of internal combustion engines. Basically this innovation provided for a better fuel/air mix and improved combustion thereby reducing CO2emissions.
Ø Cylinder Deactivation or Displacement on Demand – This technology, generally applicable for larger vehicles with V-6 and V-8 engines, provided for shutting down of one or more cylinders when the extra power was not needed
Ø Engine downsizing combined with turbocharger or supercharger – This technology aimed at minimizing the loss of energy power thereby reducing CO2 emissions.
MEASURE OF THE GREEN MARKETING IMPLICATION
These five categories will precisely measure the green marketing implication of all the companies studied.
OPPOSITION: In this category the leaders and managers reject the idea of the existence of any kind of environmental concerns. They do not think that there is a real problem for the society by polluting or adopting a bad behaviour for the environment. They can be so hostile with this idea that sometimes they can show a certain animosity for people defending and claiming environmental problems. The company of course deny all responsibilities for the environmental concerns. This behaviour is easy to detect since for instance no research will be done to produce less pollutant products whatever the mean.
PROTECTION: In this category we can notice that the company is more concerned about the environmental problems and the sustainable development but not in a positive way. Indeed, the protectionists see the sustainable development as a threat for the company and thus adopt a defensive behaviour to fight it. These companies can be recognized by performing actions such as lobbying to oppose or to slow down new laws favouring the reduction of the pollution by giving to the companies more responsibilities for the protection of the environment.
SOCIALISATION: The socialisation is categorized by a company which recognizes social, environmental, ethical problems. However, the company prefers to let it outside its activity. At least we34can notice a first implication of the company appearing as a volunteer contribution for the general interest in order to get the image of a “good citizen”. These actions can be for example the participation in the local life or any cultural or humanitarian activities.
COOPERATION: The managers consider the sustainable development issues as a professional concern and accept at least the idea of a social and environmental responsibility. However, they adopt at the same time a position of negotiation and a share of responsibilities with other actors like the state or the territorial collectivities. They also claim for them to take charge of at least a part of the costs of these adaptations to wider responsibilities.
INTEGRATION: The sustainable development issues are broached as stakes characterizing the state of a society and the structure of the markets. It means a particular effort from the company in planning the strategy and the adaptation of methods and processes. The performance in concern of the sustainable development appears like a challenge; challenge which is indispensable to satisfy the necessities of a new consumer more concerned by this environmental issue. This strategy of integration is also important for the company in order to maintain its competition in the future.
Ford won the Nielsen Company’s first Automotive Green Marketer of the Year award at the Los Angeles International Auto Show.
Nielsen picked Ford as the award’s first ever winner for three reasons:
The development of economy is the contradiction between ease the resource constraints fundamental way, and also the transformation of economic growth, an important way to achieve sustainable development. This is also with the automotive industry has been the focus coincides with the implementation of green marketing, therefore, in the mode of circular economy under the integrated green marketing requires the majority of entrepreneurs, recognition and action, advocate green living, green demand is also need to lead the government, society to jointly promote and market, business, government, society, public interaction to build a resource-saving and environment-friendly society is very important.
Ø “Toyota Production System terms,” Retrieved May 21, 2006, from May 21, 2006,
Ø http://www.toyotageorgetown.com/terms.asp.22. Ulrich, L (2006).
Ø “Prakash, A. (2002), “Green marketing, public policy and managerial strategies”, Business Strategy and the Environment, Vol. 11, pp. 285-297.
Ø Queensland Government (2006), “Green Marketing: The competitive advantage of sustainability”, Queensland Government Environmental Protection Agency, March 2006.