Abstract Do you know what is world ranking of Mercedes-Benz in most famous brands? Do you know what is the situation of Mercedes-Benz in cars industry? Do you know the factors that affect the purchase decision of customers while buying cars? Mercedes-Benz is a famous brand of luxury cars. These are German made cars and are known as status symbol of high class consumers. All customers have their own values and beliefs while purchasing a car. There are several factors responsible for the purchase decision. Car industry is growing very fast worldwide. There is a rapid change in trends and consumers preferences for comfortable, reliable, highly efficient and economical cars. Mercedes-Benz company has to take care of consumers choice to …show more content…

Mercedes has new opportunities in the market if it designs cars according to the young consumers also as they do not like big, mature looking cars and they like sporty looking cars.
2. Easy availability of spare parts in the market
3. Special designer cars for women.

Threats:
1. Availability of low cost and more efficient domestic and Japanese cars in the market

Porters Five Forces
Porter has identified five competitive forces that shape every industry and every market. These forces determine the intensity of competition and hence the profitability and attractiveness of an industry. Based on the information derived from the Five Forces Analysis, management can decide how to influence or to exploit particular characteristics of their industry. Porter's five forces for Mercedes-Benz Company are:
1. Bargaining power of suppliers: Suppliers of Mercedes supplies various parts of the cars such as engine parts and mounts, steering and transmission parts etc.
2. Bargaining power of customers: customers have a wide option of cars in the market. Some of these cars are low cost and high efficiency cars. Therefore consumers bargain for the price and quality of cars.
3. Threat of new entrants: new entrants could change major determinants of the market environment (e.g. market shares, prices, customer loyalty) at any time. There is always a latent pressure for reaction and adjustment for existing players in this industry.
4. Threat of substitute: there are many