Past statistics tell the story of when fuel prices surge, smaller fuel efficient cars are more in demand. Higher fuel prices cause households to reallocate money from other areas to purchase fuels at higher prices because fuel is needed for transportation to and from work. When fuel p... ... middle of paper ... ...lopment far exceeds any other industry in the United States. (McAlinden et al., 2003) There is no doubt that the United States depends heavily on the automotive industry. The economy has always responded to the fluctuations of the automotive industry as well as the automotive industry responding to the economy.
The growth of the automobile industry caused an economic revolution across the United States. The beginning of the 20th century, horse-drawn vehicles and the railroads were the dominant sources for transportation of both goods and people. Before the assembly line each vehicle was created individually. The assembly line created by Henry Ford, made automobile production faster and easier. The assembly line doubled production and reduced costs, and made each worker an expert at installing his particular car part.
Ford's innovation of the assembly line transformed the automobile industry from just an expensive piece of fancy metal with wheels to a productive machine of American society. Many people assume that Henry Ford invented the assembly line, however, they were wrong. Henry Ford only improved it very greatly and used it in his factories to produce them better and faster. Ford perfected it to be used for mass production. The assembly line allowed for production to increase in the factories.
The 1920's and the Automobile Industry In the 1920s, the USA's economy was booming. People felt that they had a right to prosperity and many had aims of owning a nice house and car. Most people in the USA had this state of mind. I believe that the automobile industry was extremely important in the economic boom! In the 1890s cars were only made by skilled blacksmiths, and were very expensive.
The development of the automobile in the late 18th century transformed the structure of society in the United States. Initially, cars were meant to give someone status in society, only the rich and privileged owned a vehicle. However, in today’s society, vehicles come at all kinds of price ranges making it easier for the average American to own his or her own vehicle thus, the ban on cars would change society drastically. Economically, the automobile industry significantly defines the economy of a nation manufacturing cars. “Despite the fact that many large companies have problems with overcapacity and low profitability, the automotive industry retains very strong influence and importance.
Rising, higher prices for new cars have caused the typical American consumer to examine alternate solutions for their transpiration needs. As the average car on the road is 8 years old, compared to 5.8 years in 1970, the signal to the auto industry has been that cars are being built better and consumers are not afraid to buy them. Of course, this choice does not come without an opportunity cost for the consumer. A used car will generally be bought on the condition "as is" or, at best, with a very limited warranty. If a buyer of a used car drives off the lot and finds they have purchased a vehicle that needs lots of money spent on it for repairs, they may possibly find themselves out of luck.
The company also makes different models that are constrained by the need to lower costs so that the car-pricing options can generate profits and revenues. Due to the extreme competition in the car market fragment, all worldwide carmakers need to balance the advantages of showcasing more cars to attract customers against the increasing cost that come about when there is an increment in the number of car models made to meet different needs of different
Assembly line: Dawn of a new age of manufacturing A motor car for the great multitude a goal for Henry Ford(Schlager 593). In the 1920s, automobiles are rapidly changing the American lifestyle forever because of their affordability and also the development of new assembly technology to lower the cost. Technological innovations of assembly begin to expand and advance for the better throughout the 1920s, which impacts Americans and the people of the world today. Henry Ford, a bold figure during the 1920s, owner of Ford automobiles. His ideas and innovation like the assembly line forever changes the automobile and the way goods are produce.
However despite its impact Fords competitive advantage was short lived and was soon taken over as Alfred P. Sloan at General Motors sensed consumers wanted more variety than what they were being offered and he offered “a car for every purse and purpose” (Holweg, 2014, p. 14). Customers were soon given a choice with a broader range of products to include cars of different colour which was in contrast to Fords standard black car. Employment Europe is the largest automobile producing region with nearly 20 million vehicles assembled in 2001. It is the world’s largest market in terms of size and the competition is intense. The automotive industry represents up to one third of European manufacturing jobs.
Although all these factors were very important to the "boom" the car industry was a major contributor to it. The car industry was so important to the boom as it had a knock on effect to other industry. It didn't just provide hundreds of thousands of jobs for people, from which the money would go back into America, but also provided jobs in other industries such as leather, steel, rubber and glass. 75 per cent of US glass production went into making automobiles in the 1920's, and a large amount of petrol was needed to power them. All of these growing industries improved the economy of America.