Automotive Industry/ Economic Theory

Global competition in recent years has had a great effect on the American automotive industry. More efficient cars being developed overseas posed a threat to local companies’ market shares (Investopedia, 2015). Market shares of largely well-known companies such as General Motors, Ford, and Chrysler all suffered losing between three and ten percent of their previously held market shares between 2000-2014 to foreign competitors (Investopedia, 2015). For decades, the United States had the best technological advances in the industry and it was very difficult for competition to survive. In response to this, companies overseas invested significant amounts of money into researching new innovations and ways to produce better automobiles than the United States (Investopedia, 2015). Also, because of the difference between currency values, the cost of labor in other countries is lower than here. This allows foreign companies to be able to sell their products at lower costs and attract customers through undercutting their competitors’

The burning of gasoline by automobiles releases carbon dioxide and other types of air pollution

These barriers include, but are not limited to, the following: large established competitors, high capital requirements, limited initial access to distribution networks, and environmental regulations. Due to the existence of massive brand name manufacturers like General Motors and Ford, any new entrants in the automobile industry will be competing with companies benefiting from strong customer loyalty, economies of scale, and impressive marketing budgets. Therefore, new entrants must be able to achieve the difficult task of entering automotive manufacturing at high capacity while simultaneously building a solid consumer base. Such an entry would be quite expensive, especially in conjunction with the billions of dollars needed to construct high-volume manufacturing facilities and develop effective distribution networks to deliver new automobiles. Finally, new entrants must be able to design and manufacture their automobiles according to contemporary environmental regulations. Abiding by such regulations would further drain new entrants’ funds. Overall, entering the automotive industry competitively requires an exorbitant amount of money, so the threat of new entrants is low.

While car manufacturing is a global industry, automotive companies such as JLR operate in broader regions such as Europe and Asia. Three major trends were identified affecting car production in mature markets, the first was the fragmentation of mature markets, customers were demanding more choice, and this has made it difficult for manufacturers to obtain economies of scale, so cost had to be reduced and with the general

The American Auto Industry, in the form of vehicles it produces, account for almost one-fifth of emissions in the United States. Subtracting emissions created from production,

The purpose of this paper will be to explain how the supply and demand as well as the elasticity of demand exists for the automobiles produced by the Ford Motor Company. The early history of the company through the present will be highlighted in an effort to show how the firm became a global leaders in the production of automobiles.

The automotive industry designs, develops, manufactures, markets and sells motor vehicles, and is one of the world’s most important economic divisions by profits. This analysis focuses on the industry, specifically, manufacturers of automobiles. There are five competitors in the StratSim environment: Firm A, B, C, D, and E. Industry sales in the most recent year were 4.3 million units, with expected growth in the next year. Within this industry, there are seven-vehicle classes: Economy, Family, Luxury, Sports, Minivan, Truck, and Utility. There are two new classes with potential – if properly marketed.

Ever since the 2008 recession US automobile companies have been on a steady downhill slide, but actually you can trace this downward trend even further back than 2008. US car companies have been feeling the heat since as early as the late 1980s when Japanese car companies laid claim to American manufacturing plants . Despite a shot in the arm in sales over the past five years, American firms are still on the decline. This case analysis aims to diagnosis the problem, provide analysis of the problem, and propose a viable solution to the problem from the perspective of the US automobile market share leader, General Motors.

Pollutants that are given off through the emissions of automobiles are hydrocarbons, nitrogen oxides, carbon monoxides, and carbon dioxides. Hydrocarbons emitted by automobiles create smog. Smog can create health problems for people. These problems include lung and respiratory problems. Nitrogen oxides form acid rain that hurts plants, wildlife, and the paint on our cars. Carbon monoxide reduces the flow of oxygen in the bloodstream. Carbon dioxide is a "greenhouse gas" and is a primary factor contributing to global warming.

Just like the other industries such as apparel, electronics, and consumer goods, the automobile industry has accelerated its foreign direct investment, cross border trade and global production. The automobile industry has increased outsourcing and bundled value chain activities in major supplier chains. As a result, more developed countries that serve as suppliers have increased their involvement in trade and FDI. With these increased supplier capabilities, large national suppliers have become global suppliers and are now controlling multinational operations. This is because of their increased capability of providing good and services to various lead firms all over the world. The automotive industry has a distinct firm structure. This

·         The vehicles that are being sold are expensive so selling such products would have a good impact on the economy.

Over the years, the U. S. auto industry's market has been experiencing fluctuations due to many reasons including: price, quality and foreign competition. General Motors Corporation (GM) which had been the leading car and truck manufacturer had been experiencing declining market share and facing stiff competition from both U.S manufacturers and foreign imports such as the Asian auto producers that included Toyota, Honda and Nissan. The main reason for increased foreign competition was that foreign cars were more fuel efficient, smaller, less expensive, and often more reliable than their American counterparts.

In 1913, Henry Ford revolutionized product manufacturing by introducing the first assembly line to the automotive industry. Ford’s hallmark of achievement proved to be a key competence for the motor company as the low cost of the Model T attracted a broader, new range of prospective car-owners. However, after many decades of success, customers have become harder to find. Due to relatively new threats to the industry, increasing numbers of cars and trucks are parked in dealer lots and showrooms creating an alarming trend of stagnation and profit erosion. Foreign-based automakers, such as Toyota and Honda, have expanded operations onto domestic shores and, in turn, have wrestled

The United States Automotive industry has been dominated by five major auto manufacturers: GM, Toyota, Ford, Chrysler, and Honda. As globalization increases the domestic automotive market (GM, Ford, Chrysler) suffers from foreign competitors. Although with high entrance barriers the market suffers little to none from new entries. There are several reasons for this the largest being capital. It takes a lot of capital to obtain manufacturing plants, raw materials, as well as to hire and train employees. PASTEL Analysis

A thorough analysis of the external forces that shaped the global automotive industry in 2009 reveals how the rivalry between established car makers set the stage for some to successfully survive the global recession while others were forced to seek Chapter 11 bankruptcy. A closer consideration of the impact of consolidation, demand and supply, fixed costs, product differentiation, and exit barriers on rivalry within the industry reveals how new entrants and weaker competitors were able to take advantage of environmental opportunities during the recession and gain profit shares. These considerations illustrate the critical importance of analyzing the forces that shape competition in an industry and how such an analysis serves as the