NUST Business School

International Business
Project Proposal

Submitted to;
Ms. Ayesha Pervaiz

Submitted by;
Asadullah Sher
Dure Sameen
Kainaat Zulfiqaar
Muhammad Ahmad Sami
Muhammad Ali Qasim
Rafay Ahmad

BS ACF 2K16 A

Date: 13 Feb, 2019

 Investment Project Proposal (FDI)
As part of a US Multinational Corporation Tesla, we propose a very healthy opportunity in a very
emerging and developed industry of Germany.
We advise the company to set up their business in Germany and introduce an electric car there,
because German automotive industry is highly lucrative but still is out of the race of electric cars.
As Tesla dominant in production of high quality electric cars, they can invest in Germany and
attract their tech-savvy audience. This foreign direct investment, which involves introduction of
their product in new country will be an effective mean of expanding to new market.
Why this foreign direct investment is attractive?
Investment in Germany will be very attractive as Germany’s highly competitive automotive
industry is lacking this, at this stage it will be very beneficial for our company to launch electric
cars in Germany.
As Germany is recognized in the world for its excellent automobile industry and excellence in
engineering and it is one of the leading Europe’s production and sales market. The country’s
world class R&D infrastructure and its highly qualified workforce will create an peerless
automotive environment to help our vision to grow the business of Tesla in Germany.
Germany is Europe’s number one automotive market; accounting for over 30 percent of all
passenger cars manufactured (5.65 million) and about 20 percent of all new car registrations
(3.44 million). (German trade & invest, 2018)
Germany has an open and welcoming attitude towards foreign direct investment (FDI). The legal
framework for FDI in Germany favors the principle of freedom of foreign trade and payment
transactions as laid down in the Foreign Trade and Payments Act and the Foreign Trade and
Payments Ordinance.
Among other the country’s strengths are a highly powerful and diversified industrial network, a
highly skilled workforce with a good command of English, reliable infrastructure, a favorable
social climate, a stable legal framework and a location at the heart of Europe which makes it a
very good opportunity for such foreign direct investment which has very good growth prospect.
Few Concerns:
We cant say that this opportunity will be a 100% success as automobile industry is a cyclical
industry, so far economy of Germany is in very well condition but no one knows what happens in
the future. On the other hand political conditions of Germany are unsettled which is largely due
to the difference that is public opinion polling around about the state elections. Bavarian election
has confirmed the cold reality of both the AfD and Chemnitz lies in Germany’s most enduring
contemporary problem: the east-west divide.
Moreover Germany took more than a million asylum seekers at the height of the refugee crisis
in 2015-16. In the seven years up to 2014 – so before the war-induced refugee influx mostly from
Syria and Iraq, this has induced social pressure and is described as surely unfairly – as inward-
looking.
Apart from these political concerns, which is common in about all countries it is a very attractive
opportunity and we advise the firm to look upon it.