<p align="justify">Peugeot is a French automaker originated from Sochaux, France. It was established by the Peugeot family of Sochaux in 1810. It was used to build coffee machines and bicycles at that time (Peugeot, 2020). The company started to build its first car in 1889. The company is nowadays operated by Group Psa (Groupe Psa, 2020). It is considered one of the oldest automobile maker in the world. It has a presence around the world. It dominates Europe&#8217;s automobile market. It also operates is the sports division. It is well known for its rally car. Peugeot is investing heavily in electric cars. Porter’s five forces model is used to identify threats and business opportunities faced by Peugeot in the automobile industry.</p>
<h2 align="justify">Competitive Rivalry in the Market</h2>
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The automobile market is the most competitive in the world. In Europe, there are few of the world&#8217;s biggest automakers. Which makes the market saturated. In the region, Peugeot has intense competition with Renault and Volkswagen. Renault is a French multinational automobile maker, which posted annual revenue of $67,764.10M. Which yielded in profit of $3,896.90M (Fortune, 2019). While Volkswagen in a German Multinational automaker giant. It posted the revenue of $278,341.50M which gained them $14,322.50M (Fortune, 2019). Whereas Peugeot generated total revenue of $87,364.30M which gained them $3,336.30M (Fortune, 2019). Peugeot faces intense competition in the European market due to the presence of other automobile giants. It should expand its market range to hold onto its business share to compete with this type of automakers.</p>
<h2 align="justify">Threat of Substitutes</h2>
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The electric car industry is a real threat to traditional automakers all over the world. The improvisation in technology and the increasing satisfaction of customers in battery electric vehicles are gaining ground. The cost of battery electric vehicles will be on par with internal combustion engine vehicles by 2022 (Deloitte, 2019). The rapid innovation in electronic battery technology is a real threat to companies like Peugeot. Peugeot has already been working on electric cars. It has been involved in a joint venture with the Toyota Czech Republic to build low-end sustainable cars. It has already worked on a 100% electrified vehicle range by 2025(Groupe Psa, 2020). ; It already has 3 plugin hybrid models in the market for now. They need to ramp up their effort to stay ahead of their competitors.</p>
<h2 align="justify">The threat of New Entrants</h2>
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The threat to enter the automobile market is low at that moment. It is because of the higher sunk investment and bringing the new innovative product. The cost of compliance and legal fees are setups very high by the regulators. The growing voice against carbon emission requires a whole lot of effort which a startup can&#8217;t afford. The startup should come with a better innovative product and keeping the price tag in mind. Its product should be able to disrupt the loyalty of customers of existing brands. Existing brands will retaliate to hold on to their business share. They can do it because of their diversified product line and secured financial future. Peugeot can compete with those startups due to its diversified product and innovation in products. The overall threat is low in that case. </p>
<h2 align="justify">Bargaining Power of Buyers</h2>
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he automobile market is soaked with too many companies right now. You can find alternative products with multiple options in the market nowadays. The buyer will exert its bargaining power if there are alternative products available in the market. In that case, the buyer can do that. The buyer can switch to any other brand if he has any problems with the product by Peugeot. The majority of buyers are individual customers. They can be easily persuaded away from the brand. To compete in this type of environment, they can&#8217;t afford to compromises on their quality. Peugeot should innovate new products as well as maintain their quality. It can keep its clientele intact. If they can do it, it will provide them business safety in the market. Buyer power is higher at the moment.</p>
<h2 align="justify">Bargaining Power of Suppliers</h2>
<p align="justify">The automobile market has a complex supply chain system. It has several suppliers linked with it that provide components. The automaker assembles them to complete the product. The majority of the automotive industry in horizontally integrated. The supplier can exert its power if it holds future integrated. The future integration costs a lot of money to the supplier. It can cost companies a lot of money if they wanted to switch suppliers in the middle of production. It will be impossible to get a good supplier for the ongoing product. The suppliers can directly benefit if it can sell its products to some other company. In that case, the market is already saturated with producers. It provides an extra edge to the supplier. The supplier holds major bargaining power in this case. </p>
<h2 align="justify">References </h2>
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Deloitte. (2019). New Markets, New Entrants, New Challenges. Available at: https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/manufacturing/deloitte-uk-battery-electric-vehicles.pdf<br />
Fortune. (2019). Global 500. Available at: https://fortune.com/global500/2019/peugeot/<br />
Fortune. (2019). Global 500. Available at: https://fortune.com/global500/2019/renault/<br />
Fortune. (2019). Global 500. Available at: https://fortune.com/global500/2019/volkswagen/<br />
Group Psa. (2020). Brand &; Technology. Available at: https://www.groupe-psa.com/en/brands-and-services/<br />
Group Psa. (2020). Groupe PSA, committed to clean and sustainable mobility. Available at: https://www.groupe-psa.com/en/automotive-group/innovation/groupe-psa-lelectrification-en-marche/<br />
Peugeot. (2020). Brand &; Technology, History. Available at: https://www.peugeot.ph/brand-and-technology/history/</p>