Perodua is one of the largest local car manufacturer in Malaysia that produce a high quality of compact car at affordable price. With technological and technical support from Japanese company, Perodua successfully produce variety range of vehicle. Perodua has been growing as the bestselling car brand after introduced Perodua Myvi in 2005. Due to rapid changing in the automobile industry, Perodua has face several challenges and problems to maintain and improved its competitive position in the market. Therefore, Perodua has emphasized on identify and implement the best business strategy in order to stay competitive in the market. This assignment is serve as the solution for Perodua to analyze the strategic management of Perodua and choose the best business strategy to achieve its objectives. In the second chapter of this assignment, strategy formulation framework will be discuss in briefly. The purpose and function of all the tools such as IFE and EFE matrix used to analyze the data in this assignment will discuss step by step in the strategy formulation framework. The chapter 3 will discuss about the internal and external environment of the Perodua. In the following chapter 4, the data from previous chapter will be used to identify the competitive position of the Perodua in the market and find out the critical success factor for Perodua. The chapter 5 will use the information from the chapter 4 to identify and evaluate the opportunity, weakness, strength and threat of the Perodua in order to determine several business strategy suggestion for the Perodua. In the following chapter 6 will analyze all the strategy or alternative and select the best business strategy with the highest score. The best business strategy will then used in the last chapter to explain in details. The last chapter will explain what is the best strategy selected and why it is recommended, how to implement the best strategy such as what resources needed, which department will involve and others.