American Auto Industry : Environmental Analysis

“The US auto industry directly employs 1.55 million Americans and impacting a total of 7.25 million US jobs, generates $500 billion in annual compensation.” (1) With such a large industry looming in the economy, it is inevitable that it will face environmental challenges. Environmental challenges can be hard to control and are essential to the success of a company. The challenges that the auto industry must contend with are many and complex, such as; global competition, consumer opinions, and new technology, a difficult fight lies ahead.

Of course people would have to choose between variety of brands and the best among the others, these are some examples of popular Japanese automotive brands; Toyota, Honda, Subaru, and Nissan.

Over the past decade foreign car makers have outsold American car makes at an enormous rate. Heading this field of foreign makers is the Toyota car of japan and more specifically their most popular selling car the Camry.

us that are old, enough to remember how the Big 3 automakers almost collapsed back in the late 70's, early 80's, the world was made aware of the troubles in these plants. The autoworkers seemed to be sucking the companies dry with their extravagant labor agreements, while their levity, quality and design of their product was lackluster. The oil embargo that OPEC orchestrated also revealed a problem with U.S. automakers, they were unwilling to adapt to the changing environment around them. Meanwhile the Japanese automakers were busy making fuel-efficient, smaller, less expensive vehicles; the Big 3 resisted this change with their very fiber. They continued to crank out their muscle cars, and their gas-guzzlers. Consumers lost confidence in the U.S. automobile and quickly switched to the cheaper more fuel-efficient Japanese models.

With the increase of global competition, the manufacturers of vehicles in the US had been negatively

Asian and European car manufacturers became major threats to the US market shares. The economic

The automobile industry is occupying a special place in the world economy. Since its creation by the end of the nineteenth century, automobile has got a tremendous expansion worldwide and in the United States in particular, so much so that the country witnessed the fastest development of the automobile and the emergence of world largest automobile manufacturers. In this paper, we are going to analyse the environmental challenges facing the American auto industry through the following environmental facets; the global competition in the industry, New technology for powering automobile, the effect of emissions on the environment and government reactions to this and consumer opinions about this product.

very different from the global top manufacturers, where Toyota stands on top with 11.6% of the

Volkswagen, as the name suggests means “people’s car” and defines its objectives to design and manufacture cars which are fuel efficient and affordable. With continuous improvement, Volkswagen has not only subjugated the automotive market with respect to its low priced cars, but also earned industry acknowledgement. The core competency of Volkswagen is structured to build customer loyalty. Although, Volkswagen suffered from erratic sales pattern when the company introduced a new model commonly called as the “Himalayas chart” due to its rise and falls (Austin, 2007).This was because of the management not dealing with situations proactively. This problem was mitigated soon through its

Businesses undergo diverse changes in their aspirations to dominate the market, reduce on costs, and increase their efficiency and profit margins. Tracing these changes from the time the firm was started to its current position would reveal a significant amount of efforts that the company has had to put in to enhance its growth and success. The Porsche Company established in 1931 by Ferdinand Porsche together with his son has seen a fair share of these changes (Henderson & Reavis, 2005, p. 2). The company’s business model revolved around the provision of engineering services and vehicle designs to automakers. Porsche was called upon by the then Germany leader, Adolf Hitler, to come up with a car for the Germany population. The vehicle was known as the “people’s car” or “Volkswagen”. In 1948, the company rolled out its first car,a sport car that it continued to produce earning it a significant share of the market.

The invention of automobiles had been dated long back in history. From that day till now, it had not only made our lives easier but also simpler. From times back then till now many big automobile companies had came into existence, some of them were successful and some were not, thus going out of market and competition. Among them, Porsche and Volkswagen Group(VW) have emerged as one of the world leaders in automobile industry. Through years of hardwork and sheer use of technology and engineering developments, both of these companies have carved a name for themselves in their respective markets. But sometimes, bad management and several areas of conflict arise between two companies that can lead to its downfall. In this case too the CEO of Porsche, just wanted to administer each and everything according to his own ways and rules, but on the other hand the CEO of Volkswagen, even after facing huge loses wanted to continue on with his strategy because he was quite confident about his strategy and clearly had a broader outlook of the scenario. Therefore, due to having different mindsets, there was a conflict between the ideas of two which led to the decline of one of them. These conflicts can be summed up in the following couple of questions:

In 1890 the American auto industry bloomed in the United States leading to hundreds of manufactures. Come 1920’s there were three main auto manufactures known as the “big three” (2015, Wikipedia). Those three manufactures are Ford, General Motors and Chrysler. Global competition started to cut into the American auto market come the 1970s. The international auto market combined with oil prices and economic crisis continue to affect the American auto market. Overall the American auto industry has experienced steady and on occasion harsh drops in the US market while receiving some small gains, however, no gains have brought them back to the hay day they experienced between 1920s and 1950s.

Strengths: The main strengths of the industry are an extended manufacturing base, availability of skilled workers and membership of the EU. The absence of trade barriers between EU member countries facilitates exports, a significant fact since customs duties account for as much as 20 per cent of the vehicle cost. The country also has the technological expertise and infrastructure to make a wide

Toyota 's was the first company to introduce a full hybrid system of vehicles and is the most popular hybrid system in the world. On the other hand, American Auto Industry was late at adopting this hybrid technology. They were using high gas consuming technology which was environmentally unsustainable.

In the early 1980s, Japanese auto makers contemplated building cars in North America. At that time, it was unclear whether cars produced outside Japan could live up to their hard-earned reputation of high quality at low cost. In 1992 Toyota meets a