Factors influencing Chrysler's sales decline, 1999-2011

¶ … Decline in Chrysler Sales

Chrysler Sales and U.S. Car Manufacture

Chrysler Sales and Gas Prices

Chrysler Car Sales and Unemployment

Validity and Reliability

Validity

Reliability

Future Changes to Research

In the previous paper research was undertaken to gather data which could be used to examine potential influences on the sales patterns seen Chrysler cars. The dependant variable is the number of cars sold, with information taken from the period 1999-2011. It has been hypothesized that it is the decline in sales which lead to the firms' failure. However, while some data, such as units sold, is obtainable, as the firm was part of other companies and is now in private hands full financial data is not available. However, in terms of general trends, as seen in the graph in figure 1 shows the decline in sales, where the units sold is it at the lowest at the time the organization faces failure.

Figure 1; Number of Chrysler cars sold 1999-2011

However, this does not tell us how or why the sales declined. Independent variables which may have impacted in the decline in sales have been identified as the decline in the number of cars manufactured in the U.S., the cost of gas and the level of unemployment.

To assess the potential relationship between the independent variables and the dependent variable the use of a regression analysis can be undertake along with ANOVA to determine of there may be a causal relationship. Each f the independent variables will be examined in turn.

2.

Analysis

2.1

Chrysler Sales and Gas Prices

Figure 2 uses the same approach, with a scatter chart draw with a trend line to assess if there is any correlation between the two data sets. The gas price, which is given in cents per mile, appears to have an inverse correlation seen with the downward sloping trend line.

Figure 3; Chrysler sales against gas prices

The data points are more spread out away from the trend line compared to the patterns seen in figure 1. The R2 statistic is 0.61, which indicates that there is a looser correlation. However, the significant f is 0.001. This means that although there appears to be a relationship it is not sufficiently strong to be determined that it may be a clear predictor, but it is useful.

2.3

Chrysler Car Sales and Unemployment

The same analysis process is conducted as seen with the first two independent variables, with car sales plotted against the unemployment rate.

Figure 4; Chrysler cars sales against unemployment rate

The R2 statistic is 0.9372, indicating a very good