Final answer:
Volkswagen may have made the decision to stay in Russia due to the potential for long-term growth and to strengthen its brand reputation. The pros include gaining a competitive advantage and positioning for future profitability, but there are also risks such as political instability and economic downturns. In the tutor's opinion, it is a reasonable decision considering the potential rewards.
Step-by-step explanation:
Volkswagen's decision to stay the course in Russia despite current political and economic headwinds could be driven by several factors. One reason is the potential for long-term growth in the Russian market. Despite its current challenges, Russia has a large population and a growing middle class, which presents a significant market opportunity for automakers like Volkswagen. Additionally, by demonstrating its commitment to the Russian market, Volkswagen may be able to strengthen its brand reputation and customer loyalty.
There are both pros and cons to this decision. On the positive side, Volkswagen may be able to gain a competitive advantage by establishing a strong presence in Russia while other automakers are hesitant. By investing in manufacturing and infrastructure in the country, Volkswagen could position itself well for future growth and profitability. However, there are also risks involved, such as political instability and economic downturns that could impact sales and profitability in the short term.
In my opinion, it is a reasonable decision for Volkswagen to stay the course in Russia. While there are inherent risks, the potential rewards are significant. By taking a long-term view and investing in the Russian market, Volkswagen can position itself as a leader in the region and potentially reap the benefits as the market grows and stabilizes.