The marketing of vehicles during the economic downturn
Maliszewska, Magdalena Beata
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South Africa's automotive industry has become an increasingly important contributor to the country's gross domestic product, largely through the strong growth in the motor vehicle and component exporting sector. The South African Motor Industry is ranked 20th in the world in terms of vehicle production. It is responsible for an estimated 80% of Africa's vehicle productivity and makes 0.85% of the world's vehicles. In this study, the automotive industry in South Africa is investigated, how it was influenced during the recession which started at the end of 2008 and went through the 2009 period, what effect it had on the market as well as the influence on sales during that period. In the literature section, the 4P's of the marketing mix are explained and discussed as well as how it influences the automotive industry. The purpose of this study is to see specifically how the Klerksdorp dealerships were influenced by the recession and what decisions they had undertaken to tackle the problems that they encountered. This study also investigates what influences the marketing mix had on the different dealerships in Klerksdorp area. From the empirical study done, the conclusion is that the dealerships in Klerksdorp were struggling through the economic crisis. As far as the product was concerned, the different dealerships concentrated on the best selling lines during the recession period. Very few dealerships adjusted their prices and very few offered extras that were already included in the price. With the promotion, it was actually established that the dealerships did not actually put any extra effort in order to promote their vehicles. Four out of nine dealerships decreased their promotion expenditure, while the other five kept it at the same level. None of the dealerships has increased their promotional spending during the time of recession. Finally, the recommendations to the dealerships, as how to improve the marketing and sales through the correct use of the marketing mix, especially through the use of promotion in the Klerksdorp dealerships were made.