The Global Automotive Industry

The Used Car Industry In the past 30 years, the United States auto industry has gone through many changes. In order to stay competitive with a foreign market, constantly threatening to eat away at profits, the American auto industry has had to respond by being flexible and adapt itself to this new situation. Although, in the past, they were slow to get the message sent out by the consumers, the domestic auto industry now seems to be more than willing to analyze, and answer, the demands of a smarter, savior consumer. The growth of the used car field has been a result of these demands. Rising, higher prices for new cars have caused the typical American consumer to examine alternate solutions for their transpiration needs.

The Japanese also responded to the quota by selling larger cars and improved their build quality. Overall, the price of Japanese cars in the United States rose, and the rent was captured by the Japanese firms. The United States’ losses were about $3.2 billion in 1984, which were transfers to Japan rather than efficiency losses. The financial crisis in 2008 hurt the automotive industry hard, causing many manufacturing facilities to shut down. GM and Chrysler both entered bankruptcy, and Congress decided to give government aid to the failing companies.

Weather large or small they are all fighting for a piece of the nation and international market. The larger companies will have just as much trouble adjusting to change as a smaller company. This is because a small car company that does not produce many cars will find that to advertise a car on a small scale will probably take the same percentage of profit as a large company that needs to advertise on a large scale to keep the company going. In the car industry, manufactureres will be bringing out new models and varieties of cars all the time due to the intense competition to be at the top. There are seasonal changes in market demand; these become apparent when looking at car sales figures.

While most industries have an effect on the economy, the automotive industry has far-reaching implications for most Americans. Not only are the workers affected but the many spin-off jobs created as well as the consumers that must purchase the automobiles manufactured. The automotive industry is considered elastic. The prices fluctuate depending on supply and demand. For example, when the economy takes a downturn and car sales are down the automakers attach incentives to the purchase of new vehicles to stimulate sales such as interest-free loans, rebates and lowered prices to encourage Americans to purchase their goods.

Future Outlook For the past many years, the American automotive companies rode the economic booms and success that was built by them long ago. They also knew that the American governments employ the “Too Big to Fail” philosophy, believing companies that are too large and too interconnected to the economy are too valuable to be allowed to fail. It was this lack of incentives that lead to their demise. Apart from ford, the other two big players in the American Automotive industry failed to become competitive and they paid a heavy price. Now that they had their wake up call, consumers can only expect better things in store.

Fickle Customers: The frequent change in customer choice has made the car industry more versatile. People who like i20 may not like it after purchasing. Everyday a model can't be manufactured in daily basis. Earlier getting cars was a big thing a new model used to come in months to years but now getting a car is not a big deal. if you do not like it you can sell it and again get a new one.

It is without a doubt that the automobile industry has resulted to massive effects on globalization. This article discusses the effect of the automobile industry in globalization, and reviews which part of the automobile industry has affected globalization. How did the automobile industry effect globalization? The automotive industry has been in the global scene since its inception. Off shoring of vehicle production was begun with the mass production of system of Henry Ford, which came alongside mass markets.

As auto manufacturers from Japan, China and Europe have started expanding into the U.S. they have taken much of the business. This situation is causing U. S. based companies such as Ford and General Motors to lose not only money but market share. It is clear that this situation is not sustainable and must be remedied if these companies are to stay solvent. As the United States and the world as a whole become more urbanized and less rural the demand for automobiles will begin to decline. Where once the idea of taking the bus or other means of public transit was looked down upon recently mass transit is becoming popular and even encouraged.

Another factor involved with the auto industry, is a pressure on the companies ability to increase prices. Due to excess capacity and the ability of Japanese and Korean auto manufactures to mass produce and thus lower cost prices, many companies in the auto industry are producing vehicles at little to no profit due to the inability to raise prices. A major risk or concern for North American auto makers is the employee's health care expenses. For Ford, in 2006 their health care expens... ... middle of paper ... ... understand the process, and the in's and out's of what is needed and wanted for a car, who also have good business sense. So what does this say about the future of Ford and the auto industry?

Global Outsourcing and Job Loss Outsourcing has become a popular trend among United States companies within the last decade. American companies are feeling challenged to raise profits, lower prices, and put their products to market before the competition. International manufacturing is benefiting both consumers and producers in this regard. However, the question of whether or not offshoring is a positive or negative influence on the United States job recovery, in today’s unstable economy still remains. In this paper I will discuss the pros and cons of outsourcing in regards to manufacturing jobs and IT jobs within the computer industry.