(A Machine learning regression model project 3 )
A Chinese automobile company Geely Auto aspires to enter the Nigerian market by setting up its manufacturing unit and producing cars locally to compete with their Nigerian, US and European counterparts. GEELY AUTO wants to understand the factors on which the pricing of cars depends. Specifically, they want to understand the factors affecting the pricing of cars in the Nigerian market, since those may be very different from the Chinese market. The company aims to understand :
- Which variables are significant in predicting the price of a car
- How well do those variables describe the price of a car
- Model the price of cars with the available independent variables(i.e car price determinants). The management will use it to understand how exactly the prices vary with the independent variables. They can accordingly manipulate the design of the cars, the business strategy etc. to meet certain price levels.
- The model will be a good way for management to understand the pricing dynamics of a new market.
From the above explorative data analysis (EDA) and Model building, it can be observed that:
- The Nigerian car market majorly preferred Gas to desiel as fuel type of choice.
- Honda civic models are highly demanded considering their average price sustainability. bmw x3 is the most cost car brands yet amongst the most demanded in the market which could be due to it meeting the demands of the luxury class and also the standard of it's price detrerminants.
- Four doors sedan cars and two doors hatchback are in high demand in the market.
- Engine size of 122 is also amognst the highest choiced in the market
- The mean absolute error of Random Forest Model(RF) shows 1354 as price prediction and a performance rate of 91%, making it a model of preference.