The Economy Of The Automobile Industry

A vehicle is one of the biggest purchases a person will ever make. Over the years, the prices of an automobile have increased due to the rise of inflation. Due to a price index, the price of an automobile changes over a certain period of time. Economists compare averages of automobiles to calculate the cost of each vehicle that presents itself on a car lot. When all of the above is calculated within the purchase of an automobile, it affects every area of making the automobile to selling the automobile. All of these factors are impacted together for the automobile industry as a whole.

The American Auto Industry has flourished ever since it’s uprising in the early 1900s. “Although the blueprint for the modern automobile was perfected in Germany and France in the late 1800s, Americans dominated the industry in the first half of the twentieth century. Henry Ford innovated mass-production techniques that became standard, with Ford, General Motors and Chrysler emerging as the “Big Three” auto companies by the 1920s (Foner & Garraty 1991).” But this industry has always been one of the leading industries for environmental issues and hazards around the world, especially in the United States. Many of the issues in this industry include: global competition, new technology for powering the product, the effects of emission on the environment and the government’s response, as well as consumer opinions about the product.

Lean is an approach that can be used in every organization to increase customer satisfaction, decrease costs, improve quality, and increase the output, by eliminating waste and creating value (Manos & Vincent, 2012, p.1).

Contributing 3 percent to 3.5 percent to the overall Gross Domestic Product, the automotive industry is essential to the United States’ economy.1 The automotive industry would critically affect our national economy if it ceased to exist. In 2008 through 2010, the automotive industry suffered a crisis. Many things lead up to the crisis, putting the economy into an unstable condition and putting distress into the minds of the American people. This forced some of the country’s automakers to go into bankruptcy, causing a fall in the workforce. Eventually, the crisis was solved, and the economy returned to its stable state. This whole disaster started through one event. Fueled by the 2008 recession, the automotive industry suffered a crisis that hurt the United States’ national economy.

The auto industry in Canada has been one the biggest contributors to the economy since its conception. Autonomous State by Dimitry Anastakis discusses both the political and economical impacts of the automobile industry. In the book, Anastakis examines aspects of the auto industry including the Organization of Petroleum Exporting Countries (OPEC) in 1973, which spiked oil prices causing a slow down in exporting goods and a decrease in the general economy. Additionally, Anastakis discusses the downfall of Chrysler in the late 1970’s, which eventually inspired a deal with the government in order to save the company. The book also references the continuation of globalization in Canada, focusing on elements such as the entrance of over seas (mostly Japanese) car companies and in what way they impacted North American domestic companies. Moreover, it explains the effects of the 1989 Free Trade Agreement that was signed between Canada and US. This agreement helped govern trade and economically boosted both Canadian and US markets.

Today’s auto industry is characterized by competition, both global and local, as well as a definite drive to make faster, cleaner, and more fuel-efficient vehicles. American automobile manufacturers have responded to the global competition by aiming to be more productive, and improving their cars in order to compete with the market overseas. What kind of competition are the American auto companies facing from foreign markets?

Most companies leaving on lean manufacturing soon find that their accounting processes and management methods are inconsistent with the lean changes they are making. The reason for this is that traditional accounting and management method were intended to support traditional manufacturing; they are based upon mass production thinking. Lean manufacturing breaks the rules of mass production, and so the traditional accounting and management methods are unsatisfactory and more often than not effectively unfriendly to the lean changes the company

The American Auto Industry has flourished since the early 1900s; it is one of the industries that represents one of the largest segments within the U.S economy and forms the core of the nation’s industrial strength. Americans dominated the industry in the first half of the century. By the 1960s the car market was flooded by the big three (Chrysler, Ford and General Motors) whose manufacturing relied heavily on promotions and model changes to boost their sales (Foner & Gratty, 1991) However the blue print for the modern automobile was perfected by Germany and France in the 1800s.

In as much as businesses are faced by challenges which occur within the working environment, they are also faced by environmental challenges which can determine the success or failure of the business. The American auto industry though viewed to be one of the top in the world; it faces its own challenges.

This report traces the fascinating trajectory of the evolution of cars, and delves into emerging trends shaping the automobile market for future growth. The report highlights major market players, discusses their products, and forecasts the growth of the automobile market through 2020.

Lean Principles have been essential to numerous organisations all over the world for achieving outstanding results in terms of efficiency, quality and manufacturing times. Large organisations are especially acknowledged to implement lean principles successfully. However, in recent years small and medium sized enterprises have been in emphasis due to their flexibility and capabilities that provides the necessary robustness in the global economic crisis (Matt , 2007). Therefore, this paper will critically appraise and assess two separate case studies by authors Matt and Rauch (2013) and Kumar et al. (2006) respectively.

Lean originally comes from the thought of scarce resources. The Japanese automotive manufacturer called Toyota was the one who introduced this method with innovations such as JIT, and so forth [14; 44; 28]. Lean operations were used as a different method for capital-intensive mass manufacture in order to help firm use resources more effectively and efficiently. As a result, the firm will be able to reduce muda activity and non-value adding tasks. The procedure of lean implementation and research had been widely used by many organizations across the world. Conglomerates found out that the manufacturing process need not only improvement in performance, but also the development must be extended and

When it comes to Lean Enterprise, it focuses mainly on reducing cycle time and also waste in the process. Lean Enterprise was at first developed by Toyota Motor Corporation as the Toyota Production System which became popular after 1973. The energy crisis facilitated the increasing demand at that time. “The term ‘Lean Enterprise’ is used to broaden the scope of a Lean programme from manufacturing to embrace the enterprise or entire organization”. (Alukal, 2003)

© 2004 Department of Statistics Malaysia The Development of the Automobile Industry and the Road Ahead Mohd. Uzir Mahidin and R. Kanageswary Abstract This paper discusses the development of the automobile industry in Malaysia in terms of production and sales of motor vehicles. The Malaysian Automotive Policy has been the key impetus for the development of automobile industry leading to the dominance of the national car in the ASEAN motor vehicle market since 1998.

NTF India is a manufacturer of engineering and composite plastic parts primarily for the automobile industry. It operates two plants in Manesar, Haryana and Neemrana, Rajasthan. Both the plants are certified to ISO9001:2008 and produce around 100 products which are used for interiors and exteriors of automobiles, commercial vehicles, locomotives and heavy industrial automobiles. For the automobiles and Commercial vehicles include automobile bumpers, mud flaps, side skirts, door trims. Locomotives and heavy industrial vehicles include the inner housing units, comprising of all the panels, dashboards, toilets.