Abstract. This paper analyzes competitive strategy of late followers in auto industry in the case of Hyundai Kia Auto Group (HKAG). The global economic crisis has had a strong impact on the leaders in auto industry

This paper analyzes how leaders in premium segments adapt their competitive strategies to the radical restructuring of the automotive industry. The analysis is based on the case study of the BMW Group. The automotive industry faces disruptive innovations which threaten to radically change the competitive structure. Leaders’ traditional competencies are no longer sufficient to satisfy the customers’ changing preferences within the premium automotive segment. This research points out the new competencies in the digitalization and electrification that a premium automotive company has to abide by in order to survive the hyper competition and sustain competitive advantage. The study highlights the necessity of reshaping the existing competitive strategies within the premium automotive segment to cope with the rising technological uncertainty and fierce competition. Strong investment in new technologies, efficient, agile and flexible production systems and implementation of hybrid competitive strategy result in strong performance within the premium automotive segment. Findings show that the transformation from the traditional premium auto company to a mobility tech company represents a key to gaining and sustaining the competitive advantage within the premium automotive segment. The paper expands the existing research literature by providing a detailed analysis of how disruptive innovations affect competitive strategies of leaders within the premium automotive segment.

Automotive industry has faced frequent and radical changes of business environment during 21st century. Great recession, disruptive innovations, rise of emerging markets competitors, and Covid-19 pandemic have resulted in new customer preferences and constrains in managing supply chain. These factors significantly have affected business operations in automotive premium segment. Traditional competencies are not sufficient to gain and sustain competitive advantage in the market segment. The paper analyzes: trends in premium automotive segments and restructuring of business models, competitive and marketing strategies in the market segment. Technological innovations and digitalization have changed customer perception of premium vehicles. To sustain market position in unpredictable business environment and deal with these factors the competitors have to be agile and flexible. Automotive companies in premium segment have to deal with increasingly complex products, to achieve business efficiency. At the same time the companies have to differentiate their products in the new way, aiming to compete traditional competitors and new comers. To achieve these opposite goals, the companies develop new technological processes, which result in lower operating costs, and integrate hardware, software and service, to create the most valuable premium packet for customers in the segment.