Surviving Price Wars

Analyze how price wars emerge in industries with rapid model launches, heavy capacity expansion, and low switching costs. Use the automobile sector as the reference point, then compare with other markets where competition can become destructive rather than productive. What strategies help smaller firms survive—niche positioning, design differentiation, cost discipline, partnerships, or exit—and when is consolidation the likely outcome? Finish with a checklist for spotting whether a market is entering a healthy competitive phase or a ruinous one.