Sanger Automotive Case

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Sanger Automo Sanger Automotive Companies Case | The Fisker Franchise Decision | Leigh Gerke |

Luxury car retailer, Sanger Automotive is considering entering into a franchise agreement with Fisker Automotive to sell hybrid electric vehicles. The market for electric cars is increasing and an early entry into the electric car market would help to establish themselves in the market.
Issue /Problem Definition
Sanger needs to determine if it would be cost effective to enter into an exclusive franchise agreement with Fisker automotive due to the market demographic, newness of product, and overhead involved.
Brand awareness
Market size and location – two markets in Florida have been identified as the up and coming target markets- Lee and Collier County. The average incomes for people in the Naples/Marco Island areas is $81,250 as opposed to the average US income of $49,445. Here there is an older population; whereas the Fort Meyers/Cape Coral area has a lower median average income around $50,120 but the total population is six times larger and the age demographic here is much younger.
Some Key Information: | Total Households | Incomes over 100K | Estimated Sales Volume per Year | Collier County | 133,640 | 20.20% | 16.2% | Lee county | 270,485 | 18.30% | 29.7% |
2.6% of total new passenger car sales in 2011, 7% in 2015
Estimate annual growth rate: 28.09%

Fisker is already established in electric car market from their initial sale of the Fisker Karma Sedan, it was highly sought after and was deemed a responsible luxury automobile. Initial set up for dealership is approx $200,000. Sanger believes that early entry to the market is important because he sees a future in electric cars, and there is a high possibility that competition may beat him to it if they do not take this opportunity. In addition, there is an empty…...

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