IntroductionThis report focuses on determining which country is better for Daimler AG to export SMART cars. It consists of PESTE analysis, primarily focusing on Economical part. Daimler AG is German car manufacturing company, 13th largest in the world. The main brands include such names as Maybach, Smart, Mercedes-Benz, Setra buses. The most shareholders are from Germany. The primary objective of Daimler AG is to seek and expand to new car market either in China or USA with Smart brand. The strategy is to export from France. China is located in both the eastern and northern hemispheres. China has 1.3 billion citizens. Today China is seen as one of emerging economies with growth rate of 11.4%, political controls still remain tight, but more and more economic controls continue to be relaxed (China information 2008). The continental United States of America (48 states) is in both the northern and western hemispheres.
As the world's largest economy, it's a significant leader in the fields of high-tech, manufacturing etc. (USA information 2008).
Political aspectsChina's Trade BarriesEurope's trade deficit with China is growing, which has achieved ÃÂ£13 billion in 2007. (Workman. D.) The EU Trade Commissioner Peter Mandelson complains that China's failure to honour commitments made when it joined the WTO. For example, under Chinese law, if imported parts make up more than 60% of the vehicle they are taxed at a rate equal to the tariff on an imported car - raising their tariff from 10-14% to the higher rate of 28%. (BBC) The reason for this tariff barrier is that China discourage automakers of foreign countries from using imported vehicle parts, and instead force multinational auto-parts companies to move their facilities and production jobs to China. This issue will be big barrier for France to export the car to China.