Doole and Lowe (2008) emphasizes how important it is for Globalmanagers to understand the economic development in countries where itwants to expand to and how they impact on the overall strategy of theFirm (Doole &Lowe, 2008;pp 12-13). This knowledge is important at aworld level in terms of the world trading infrastructure such as worldinstitutions and trade agreements developed to foster international trade,at a regional level in terms of regional trade integration and at acountry/market level (Doole &Lowe, 2008; pp 12-13).b)
A peculiar trend which was prevalent in the last decade, besidesglobalization, was a limited number of producers which emerged due todiversity among products and uniformity across national markets(Agarwal, 2004). Amid global conditions that amount to an economic andindustry crisis, the world’s auto-makers still consider innovation andtechnology to be the
over the next five years.Fuel efficiency improvements, alternative fuel technologies andenvironmental pressures are considered the three most influential trendsthat managers needs to focus on to combat operational challenges (KpmgGlobal Auto Executive Survey, 2009; p27-28)
Political and Macroeconomics Challenges
According to Stuger-Noguez (2002), political uncertainties include allpossible changes in economic policies in either side of the border. Agarwal(2004) explains how getting hit with unexpected or unreasonable currencydevaluations in the foreign countries in which they operate is a nightmarefor global operations managers. Managing exposure to changes innominal and real exchange rates is a task which the global operationsmanager must master.Doole & Lowe (2008) affirmed that politics is intrinsically linked to agovernment’s attitude to business and the freedom within which it allowsfirms to operate. Doole & Lowe noted that unstable political regimesexposes foreign businesses to a variety of risks that they would generallynot face in the home market therefore posing sometimes difficultchallenges.
[accessed 19 October, 2009