Strategic foreign direct investment in the automotive leather industry of South Africa.

Abstract

The objective of strategic management is to enable an organisation to assess its strategic position. This study is concerned with identifying the strategic position of Branaa South Africa, and to determine the most suitable expansion strategy in order for the company to increase the current level of monetary benefits offered to Original Equipment Manufacturers under the Motor Industry Development Program. An in-depth literature review is conducted and the relevant business management tools are identified. These tools are used to analyse the position of the company and to evaluate how the current benefits offered, compare to those of competitors. An analysis is carried out regarding the influence and value of the Motor Industry Development Program benefits. A costing model is then applied to determine how competitive Branaa South Africa is in the automotive leather seat market. The study determines how the benefits offered under the current Motor Industry Development Program structure could be increased in the South African Automotive market, and concludes with proposals on how to achieve new targets. This study aims to prove that the strategic direction that Branaa South Africa is envisaging is correct. The company should continue to gain a competitive advantage under the current strategic goals which are reviewed annually. Through the effective use of strategic management principles, and applying these to Branaa South Africa, the company would retain its competitive advantage in the South African Automotive market.