The Automobile Industry Has Changed Throughout The Years

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In 1769, the first human transport automobile was created and used the steam engine. The steam engine evolved into the internal combustion engine that was powered by gas in 1806. Nearly eighty years later, the petrol-fueled internal combustion engine was created. In the 20th century, the use of electricity for power was also briefly utilized. Beginning in 1769 until present day, the automobile industry has went through exciting innovative changes and there is no telling what lies ahead. According to the Economist (2013) “A variety of driver assistance technologies are appearing on new cars, which will not only take a lot of the stress out of driving in traffic but also prevent many accidents.” The Economist also states that…show more content…
automobile industry and have done so in a highly competitive way. The automobile industry is categorized as an oligopoly. In this particular structured market, outside organizations have the capability of entering the automobile industry, but in some cases there can be barriers of entry and exit. According to Colander, D. (2010) “Implicit collusion among U.S. automobile firms led to foreign firms’ entry into the U.S. automobile market.” Basically, a collective decision is made to reduce or increase pricing in the industry without companies specifically meeting to do so. In the global market, the automobile industry is competitive and creates opportunities to increase production along with establishing operations in other countries throughout the world. The ability to sustain a level of profits will be a challenge. With fluctuating market pricing, market share of the automobile industry can be increased or reduced. In some cases, making a significant price reduction can eliminate a competitor from the industry, which can result in long-term profits. Merger Activity The automobile industry has a long history of mergers, acquisitions, partnerships and alliances. In 1904 Ford Motor Company partnered with a Canadian carriage-maker. Though not a vertical merger, the partnership increased Ford’s production efficiency. The most recent automobile
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