DaimlerChrysler

The auto industry is the world's largest manufacturing industry. Overcapacity in this high fixed-cost industry is not distributed equally around the globe. Also, the effect of "lean manufacturing" and heavy concentration was changing the structure of the auto industry - only two suppliers remained for producing fuel injection systems. Marketing and brand image is key as the distribution channel, including marketing expenses, account for up to 30% of a vehicle purchase price. The auto industry has …

…eliminate the potential for differentiation. Mercedes Benz's 8% R&D cost-on-turnover allows Daimler-Benz to benefit from technological superiority. Furthermore, the quest for differentiation in mature industries requires innovation. Specifically, strategic innovation such as the Mercedes-Benz fuel cell car becomes prominent once product and process innovation have begun to slacken. Daimler-Benz is perceived as the incarnation of German engineering competence, and with cars sold in more than 200 countries, Mercedes is one of the strongest global brands.