Final answer:
In the Indian automotive OEM market, technology differences arise from factors such as market power, product similarity, barriers to entry, and competition strategies like price and advertising. Technology strategy evolves as firms adapt to local and global competition, with a shift towards sophisticated technologies driven by environmental concerns and consumer demands.
Step-by-step explanation:
The technology differences between firms in the Indian automotive OEM market are shaped by several factors that determine their competitive landscape. Market power is a critical factor, which relates to the degree of influence each company has in the industry. Firms with high market power can influence prices and exert control over the market, whereas firms with less market power may have to compete more aggressively on other fronts such as technology, price, or advertising.
Another factor is product similarity. Some firms may offer products that are highly similar to those of their competitors, which can lead to intense competition on price or other features. In contrast, companies offering distinctive or innovative products may compete more on the basis of unique technology or other differentiating factors.
Barriers to entry in the Indian automotive OEM market can affect technology strategy evolution. High barriers, which could include substantial capital requirements, access to technology, or regulatory hurdles, might limit new competitors from entering the market. Existing firms, thus, may have more latitude to invest in technology advancements without immediate threat from new entrants.
When it comes to competing dynamics, price, advertising, and product differences are common strategies. However, given the global context of the automotive industry, established local firms in India are not only competing with each other but also with international automakers. This global competition urges firms to adopt advanced technology strategies to maintain competitiveness.
The evolution of technology strategy in the Indian automotive market is continuous. Initially, many local firms focused on cost-effective production for compact vehicles suited to Indian roads and consumers. Over time, environmental concerns, coupled with customer demand for more features and globalization, have pushed these firms to adopt more sophisticated technologies such as cleaner engines, advanced safety systems, and connectivity options.