External Environment Chosen Organization | What is Environmental Analysis

External Environment Chosen Organization is a solution of External Environment Of Chosen Organization in which we discuss Developing business BMW by making use of the PESTLE method.

External Environment Chosen Organization | What is Environmental AnalysisAnalysis of Micro and Macro of BMW

Macro Analysis

PESTLE Analysis: The following is an analysis of the external environment for the chosen organization BMW by making use of the PESTLE method –

Political: The political environment of the different has an impact on the laws and regulations of the country in which the companies operates in and has been affecting the automotive since its outburst. It was essential for the automobile manufactures like the BMW to follow the laws regarding the protection of the environment of the company as proper disposal of wastes was a matter of concern for the government as well as for the company owners. Moreover the foreign policies of the government as well as the taxes levied upon the automobile manufacturing companies were the determining factors of the success of the company or its product in the markets and especially in the international markets. Moreover the introduction of the new schemes within the automobile industries in the countries of Europe and US where the regulations are in favor of the production of the high mileage cars also influenced the production as well as the sales of the cars or the other vehicles. Moreover the political instability in the countries like Russia, India, Brazil, China have a negative impact on the spending power of the customers and hence affects the sales of the BMW as well. However there are various instances where BMW made efforts to influence the political factors in order to make such factors favorable for the company.


The economical factors related to the fluctuations in the GDP of mostly the countries belonging to the European Union (EU) had a significant negative effect on the performance of the BMW Group on the whole. Moreover the revenues of the BMW Group are also affected by the exchange rate of the currencies. Due to the depreciation in the home market currency of the BMW Group which is basically Euro has proved to be beneficial for the company as it exports maximum of its products in the US markets.

External Environment Chosen Organization | What is Environmental Analysis

The following figure shows the change in the currency exchange rates for Euro as discussed above –

(research-methodology.net 2016)

Some of the other economical factors that affected the sales of the BVMW Group include the economic downturn which took place in the country of the US which is the largest importer of the products of the BMW Group. Moreover the surplus capital as well as the buying power of the huge potential as well as the developing markets like China and India has a significant impact on the BMW Group.

Social: The social factors also have significant impact on the automotive industry and hence the BMW Group as well. The changing preferences of the customers as well as their perception regarding the cars whose image got a makeover from being a status symbol for the people to being a fuel efficiency as well as low emission cars which good looks as well. Moreover the changes in the buying behavior of the customers because of the global recession as well as due to the passage of time and due to the continuous change in the preferences of the customers.

Furthermore the increasing awareness among the people regarding the emission of fuel and harmful gases from the automobiles and also regarding the protection of the environment has affected the sales of BMW significantly.


Maximization of the use of the advanced technologies by BMW has provided the company a competitive advantage over the other automobile manufacturing companies existing in the market. Moreover the BMW Group believes in incorporating new and innovative models and designs which in turn helps them to maintain their position in the market as well as to maintain a competitive over its competitors.

Legal: Strict laws and restrictions regarding the protection of environment as well as pollution especially in the markets of Europe and the US had a negative impact on the sales of the company BMW.


The increasing awareness of the people regarding the concepts of global warming, green house effect has lead to the shift in the preferences of the customers towards the hybrid cars, eco-friendly as well as solar or electric cell cars, etc. Moreover the strict laws and regulations as well as the strict application of the EURO Norms which mostly responsible for cutting down the pollution in the developing  countries has an impact of the BMW Group.

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