Economic Overview In Auto Industry Essay

In 1895 there were only four cars officially registered in the U.S. Little more than 20 years later in 1916, 3,376,889 were registered! Because of the automotive industry 's major technological advances the automotive industry has been able to pull ahead of other industries over the years. This industry has also proven that to be successful in the business world, you have to take some risks. which has allowed them to get advancements that other industries who weren 't willing to make such risks fail to take advantage of.

Economic factors: Automobile industry plays an important role in national economy. Over the past few years, automobile

According to (Economic Contributions) “building 60 million vehicles requires 9 million people directly in making the vehicles and the parts that go into them.”That’s 9 million people without including the ones who work indirectly like in steel, rubber, and other manufacturing jobs. Between and 2007 and 2009 when the recession hit there was a 7.4% decrease per year in labor productivity. The Big Three suffered a loss of 17% in the market share between 2001 and 2008. Both Chrysler and GM were obliged to file for chapter 11 bankruptcy and both received aid from the Automotive Industry Finance Program, which was created from TARP funds. The controversial bailout saved 1.5 million U.S. jobs and about

The Auto Industry in the United States has flourished ever since its revolution in the early 1900s.

challenges, however, are the most difficult ones to face and overcome. Some environmental issues that

The United States automobile industry is one characterized by incumbent behemoth corporations whose distribution channels span the world. Companies like Toyota, General Motors, and Volkswagen form entire segments of their respective countries’ economies and have dominated the auto industry for generations.

The American automotive industry provides a unique and very important role in the economy of the United States of America. Not only in the United States but even around the world, the American Auto Industry is a leader in job creation, production, exportation and even in research and development. In the mid-20th century, America’s top auto manufactures have been General Motors, Ford and Chrysler. They were producing two-thirds of all the cars and vehicles sold around the world. There are still other smaller car manufacturers such as Anteras, Avanti, Shelby American, De Lorean, Dragon and several others. As of 2010 the auto industry contributed to about 4% of the United States Gross Domestic Profit and employed about 8 million jobs.

The housing industry isn’t the only American business that has gone through withdrawals in the last fifteen years. In 2008, the automotive industry hit a critical point when the United States government was forced to bail out General Motors and Chrysler. However, this wasn’t the first time the automotive industry had struggled in this nation. The years following the United States’ involvement in the Vietnam War saw many American automotive companies losing their profits. As with any business, the car companies fought to make it through several United States recessions which greatly reduced their income. An article by Business Insider tells us that as America fought through the Gulf War in 1991 and the Iraq War from 2001-2003, many

The front-line workers in manufacturing, production, and sales of the auto industry generally require minimal education and receive on-the-job skill training. These workers may have a high school diploma and great variance in skill level for manufacturing and sales. They will receive the training needed on the job and their wages will not greatly vary; therefore, the effect of changes in training and wages for those workers of the industry would be considered minimal in changes to the supply curve. For this group, advances in technology would have a greater impact. In reviewing the labor supply for the business segment of the automobile industry such as business management, engineering, and marketing, this is the population of the industry which must: understand and keep track of changing consumer demands, understand how to maximize opportunity for growth, how to forecast, how to market, and be innovative in design and features of automobiles as technology continues to advance and the market remains competitive.

The financial crisis starting in 2008 and the following recession hit hard the US auto sector. Traditional car makers had to realise that substantial changes were needed in order to maintain their strong position in the

Global competition is an important factor for many industries including the auto industry because a breakdown to it 's simplest form, personal accomplishment and group camaraderie is achieved in the process. What is something if it doesn 't mean something to someone else? To illustrate this, I look at the most innosent form of competition between my two dogs. One was whining because the other had the ball. I threw out two balls and they fought over the newest one. The essential point is the same with people. We find value in what other people want, especially if it is popular or new. It makes it seem more valuable. We also find value in knowing that we have others wanting to beat us at what we do. Look at American football for instance. Everyone wants their team to be the top team and we pay a lot of money, and spend a lot of energy to watch the fight and engage in the rivalry. Competition is good because it creates something to out-perform. It creates a sense of worth that what we are doing is making a difference even for a short time. "Americans dominated the industry in the first half of the twentieth century" (Bland, n.d.) However, " By 2000 Japan became the largest car producing nation in the world." (Bland, n.d.) When a country finds a product that they can manufacture well, we find global customers that will pay for exports. This helps our economy flourish because it creates jobs. When that same company has global pressure to

General Motors is belongs to an automotive industry. This is the significant industry to the economy of the United States of America. Despite the fact that there are many firms in this industry, the main automakers in this sector are General Motors, Chrysler, and Ford. In the past few years, the automotive industry has faced some challenges pertaining demand

The automobile industry plays an outsized role in the economy due the industry’s cyclicality and the multiplier effect. For instance, a gearbox is purchased from a supplier that has to employ labor, purchase raw materials such as, copper, steel, wire, and other related components and services to support the activity. All of these parts are in turn purchased from other suppliers with costs to support their businesses. Therefore, as each supplier purchases components and services that they need, an increasing propensity to consume and invest in the economy raises.

Today, the automotive industry is one the top profitable industries in U.S. and all around the world. More than 1.5 million people involved in different segments such as engineering, designing, ordering, sell, and marketing. As a result of this statement, automotive industry has huge effects on employees, customer support, jobs vacancies, revenue and finally GDP which is the most important part of the economy for any countries (Statista Portal, 2016).

A second point of consideration relating to the intensity of rivalry within the industry was the level of industry demand. “Demand declines when customers are leaving the marketplace or each customer is buying less” (Hill &Jones, 2012, p. 62). This was the case in 2009 in many developed nations due to the recession, which was marked by job loss, credit problems, and high gas prices that increased the demand for fuel-efficient vehicles or left consumers unable to purchase vehicles altogether. At the same time, growth was expanding in China and some other developing nations, which opened the doors for automobile companies in these countries to expand at home and