Question

FAW Group is an automobile manufacturer known for producing efficient, durable, and low-priced cars. Recently, the company launched a new range of luxury cars to broaden its market appeal and to add prestige to its existing line of cars. This is an example of ________.

Answer 1

Diversification

Step-by-step explanation:

Diversification is a type of growth strategy that has the goal of broaden the type of products that a company offeres.

FAW Group is engaging in a diversification strategy, because it is opting to produce a luxury car, which is not typical of the company, because it specializes in low-priced, reliable cars. The goal of this strategy is to reach the higher-income people who seek luxury over cost or realibility.