While the political climate is not nearly as turbulent and disruptive as the auto industry, the fact remains that this industry that thrives on disposable income and the availability of easy credit, both of which are constrained by current economic conditions.
Opportunity and Threat Analysis
The greatest opportunity for the industry today is in creating more energy-efficient, highly customizable cars that also meet the needs of car buyers who want eco-friendly engines that have very small carbon footprints (Oliver, Lee, 2010). The broader trend of mass customization, where consumers are dictating their own brands or personas by their purchases, has invaded auto marketing and car buying. To make this selling strategy effective however, the supply chains of auto manufacturers must be synchronized to build-to-order requirements. The entire value chain of the industry is going through a shift due to this requirement today.
The greatest threat to the industry is consumer confidence coupled…...
mlaReferences
Bernoff, J., & Li, C.. (2008). Harnessing the Power of the Oh-So-Social Web. MIT Sloan Management Review, 49(3), 36-42.
Bilek, G. (2010). The Value of Information Sharing in a Build-to-Order Supply Chain. The Business Review, Cambridge, 15(1), 131-136.
Jeffrey H. Dyer, & Nile W. Hatch. (2004). Using Supplier Networks to Learn Faster. MIT Sloan Management Review, 45(3), 57-63.
Jeffrey H. Dyer, & Kentaro Nobeoka. (2000). Creating and managing a high-performance knowledge-sharing network: The Toyota case. Strategic Management Journal: Special Issue: Strategic Networks, 21(3), 345-367.
Other monetary policies that can affect the automotive industry in the U.S. include mandated price ceilings on the price of gasoline (Mankiw, 2004). These approaches, though, have not proven particularly effective in the past and created more problems than they solved. In this regard, this author also emphasizes that, "Eventually, the laws regulating the price of gasoline were repealed. Lawmakers came to understand that they were partly responsible for the many hours Americans lost waiting in line to buy gasoline. Today, when the price of crude oil changes, the price of gasoline can adjust to bring supply and demand into equilibrium" (Mankiw, p. 117).
Finally, U.S. foreign policy initiatives that use import tariffs and isolationist policies can increase the cost of the raw materials used by the automotive industry in ways that can also have a profound effect on their ability to remain competitive and profitable. According to Carlos Ghosn, CEO…...
mlaReferences
Baily, M.N., Farrell, D., Greenberg, E. et al. (2005, November 7). Increasing global competition and labor productivity: Lessons from the U.S. automotive industry. Federal Reserve Board. [Online]. Available: www.frbsf.org/economics/conferences/0511/4_IncreasingGlobalCompetition.pdf.
Beene, R. (2007, February 22). U.S. auto industry is already in a recession, Ghosn says. Associated Press: Autoweek. [Online]. Available: http://www.autoweek.com/apps/pbcs.dll/personalia?ID=AUTOMOTIVENEWS&category=contact .
Elasticity of demand. (2008). University of Rhode Island. [Online]. Available: http://www.uri.edu/artsci/newecn/Classes/Art/INT1/Mic/Elast/index.elast.html .
Mankiw, N.G. (2004). Principles of economics, 3rd ed.
Consumers at the same time are much more knowledgeable of technology factors within the industry and thus demand much more from their cars than in previous generations. Which means that automobile companies must simultaneously focus on producing efficient vehicles, but also provide all the new commodities that make the driving experience safer and more entertaining at the same time?
Finally, legal aspects of the worldwide landscape have molded the automotive industry primarily through the breakdown of barriers. The greater globalization seen in contemporary world politics means that standards across countries are becoming the same, which makes it much easier for competitors to enter foreign markets. Emission standards, gasoline standards, and general safety standards have all become much more uniform from country to country, and this helps automobile companies to manveur on the global stage. Traditional methods of import/export laws to protect domestic corporations are much a thing of the past…...
mlaSturgeon, T. And R. Florida, "The world that changed the machine:
globalization and jobs in the automotive industry," final report to the Alfred
P. Sloan Foundation (Cambridge, MA, MIT, May 1999).
U.S. Automotive Industry
Chosen industry:
automotive industry is the focus of this analysis. More emphasizes are made on the large -- scale automobile manufacturers. This is because of the inherently interesting industry as a result it being competitive and projected to go through a major restructuring due to globalization in the near days to come. The issue of decreasing oil reserves is the other reason that is going to trigger this restructuring. This analysis is carried out by a team of experts who have had extensive experience in the industry and have the right qualifications for the industry.
Analysis Methodology:
An historical overview of the U.S. automotive industry forms the introductory part of the report. Using the Porter's % forces model as the analysis framework, industry's structural characteristics is made carried out providing the current state of the U.S. automotive industry. An analysis of some of the leading companies is then carried out…...
mlaReferences
A Brief History of the First 100 Years of the Automobile Industry in the United States, Chapter 1 - A
century whittles auto makers to 3,
A Brief History of the First 100 Years of the Automobile Industry in the United States, Chapter 16
Japan's sun rising as new world becomes one,
United States Automotive Industry and Porter's Five Forces Model
American Automotive Industry
United States Automotive Industry and Porter's Five Forces Model
United States Automotive Industry and Porter's Five Forces Model
The purpose of this report is to analyze and discuss the automotive industry of the United States in the light of Five Forces of Competition presented by Michael Porter. The report starts with an in-depth introduction to the U.S. automotive industry; including its profile, present structure, major participants, evolution, and future outlook. The main body of the report discusses the competition present in the U.S. automobile industry from five different perspectives. The manufacturers in the U.S. automobile industry face a dual competition from the local and international competitors and from the substitute transportation mediums. The entry of new competitors in the industry is also a big threat for these manufacturers.
In the U.S. automobile industry, the customers make their purchase decisions according to certain preferences;…...
mlaReferences
Bigelow, L.S., & Argyres, N. (2008). Transaction Costs, Industry Experience and Make-or-Buy Decisions in the Population of early U.S. Auto Firms, Journal of Economic Behavior & Organization, 66 (4): 791-807.
Clarke, S.H. (2007). Trust and Power: Consumers, the Modern Corporation, and the making of the United States Automobile Market, 1st Edition. New York: Cambridge University.
Hill, C.W., & Jones, G.R. (2008). Strategic Management: An Integrated Approach, 8th Revised Edition. [S.I.]: Houghton Mifflin.
McCarthy, T. (2007). Auto Mania: Cars, Consumers, and the Environment, 1st Edition. New Haven: Yale University Press.
4).
2.4 Effects of Environment:
Concerns related to carbon emission were heightened in mid-2000s and in 2007 Al-Gore in his book 'An inconvenient Truth' condemned the big three saying "They keep trying to sell large, inefficient gas-guzzlers even though fewer and fewer people are buying them." In comparison to other developed countries in Europe and Asia, American standard for distance covered in one U.S. gallon was only 25 mpg (miles per gallon). We see a sharp contrast here as Japan has a standard of 45 miles per U.S. gallon followed by 35 miles per U.S. gallon in China and 47 miles per U.S. gallon in European Union. Having least concerns for environment when the state of California raised its standards the big three went to courts. An amount of USD 25 billion was provided to the big three in October 2008 to upgrade themselves and produce vehicles with a standard of at…...
mlaReference: Bureau of Labor Statistics (2012), Automotive Industry: Employment, Earnings, and Hours
Figure 4: Automotive government funding
$ billions Purpose
$19.4 GM Pre-filing
30.0 GM DIP Financing
Microeconomics on the Automotive Industry
A Study of Elasticity and Demand Generation
Global and national economic cycles have a direct effect on demand for the majority of durable goods consumers purchase, with the automotive industry being the most influenced by the cost of capital, interest rates, and elasticity of demand that varies by type of auto and market segment. The intent of this analysis is to evaluate how pricing strategies can be defined to attain the optimal level of profitability in the auto industry given specific microeconomic conditions. Included in this analysis is an assessment of how economic and liquidity impact the purchase of vehicles over the long-term, and how automotive manufacturers strive to attain lower costs of manufacturing through lean production and Six Sigma methods of production. In addition, the aspect of consumer behavior and its impact on the economic cycles of elasticity are also discussed. Favoritism or ethnocentric-based approaches to…...
mlaReferences
Bajic, Vladimir. (1988). Market Shares and Price-Quality Relationships: An Econometric Investigation of the U.S. Automobile Market. Southern Economic Journal, 54(4), 888.
Cassel, Herbert S., & McCormack, Vincent F.. (1987). The Transfer Pricing Dilemma -- And a Dual Pricing Solution. Journal of Accountancy, 164(3), 166.
Chu, T., & Su, Y.. (2010). Will the U.S. Auto Market Come Back? Business Economics, 45(4), 253-265.
Jeffrey H. Dyer, & Kentaro Nobeoka. (2000). Creating and managing a high-performance knowledge-sharing network: The Toyota case. Strategic Management Journal: Special Issue: Strategic Networks, 21(3), 345-367.
Introduction A manufacturing system includes four different components together with the production machine, material handling system, computer control system, and human resources (Lee, 1998). In recent times, due to the technological advancement, automation of manufacturing systems has continued to become prevalent. A key aspect in the contemporary automotive manufacturing systems and automotive industries is automation. An automated manufacturing system alludes to an intersected or interrelated system of material processing stations with the capability of automatically processing an extensive range of part types simultaneously under computer control. Imperatively, the system is not just interlinked by a material transport system but also interconnected by a communication network for assimilating all aspects of manufacturing. This sort of system portrays flexibility in handling, routing, processes, and changing of tools. Also, an automated manufacturing system demonstrates key features, including a high magnitude of automation, integration, and flexibility (Swamidass, 2000). This paper examines the four different parts…...
(Das; Puri, 2003)
Innovation Management systems are also able to generate structured processes for evaluation and sharing ideas, such that decision makers are able to target those who possess the maximum potential. Nevertheless from the perspective of a manufacturing industry, the two costs which are important are material cost and processing costs which together accounts for 60% to 70% of the cost of goods sold. Material cost reduction in this perspective is defined as any attempt to lower the cost of bought-out components/raw materials through procedures like value engineering, part rationalization, competitive standardization, alteration in packaging, enhanced transportation etc. Normally, the suggestions emanate from several components in the value chain like customers, suppliers, staff in charge of procurement and designers of products as well as stores personnel. Productivity improvement signifies modifications of any processes which can be core manufacturing process or support processes like material handling. Various challenges can be…...
mlaReferences
Bollig, Hanns Guenther. (2002, Nov) "Survey on the growth perspectives of the European
Automotive Supplier Industry: How suppliers can win more business in Europe" Retrieved at http://www.themanager.org/resources/European_Automotive_Supplier_Industry.htm
Dannenberg, Jan; Burgard, Jan. (n. d.) "2015 Car Innovation: A comprehensive study on innovation in the automotive industry" Retrieved at http://www.oliverwyman.com/ow/pdf_files/CarInnovation2015_engl.pdf
Das, Monish; Puri, Rajiv. (2003, Sep) "Using Innovation Management for Cost Reduction in the Automotive Industry" Retrieved at http://www.infosys.com/research/publications/cutting-edge-CE-07-03.pdf
Thus, it is clear that one of the major reasons why the Edsel failed to sell or become as popular as Ford had anticipated was because it was really nothing new as compared to the dozens of models offered by Ford's competitors, such as GM and Desoto. In essence, the people in charge of sales at Ford did not have the foresight to understand that the American consumer had changed after the war years.
In his excellent study on the Edsel, Rob Daines provides several reasons which supports the idea that the Ford executives responsible for sales did not know what they were doing in relation to selling the Edsel to the American public. First of all, "the market for medium-sized cars" which stood at about 40% when the Edsel was introduced, "had dropped to 25% by 1957 because of the inroads made by imports and smaller American cars," such…...
mlaBibliography
Daines, Rob. Edsel: The Motor Industry's Titanic. Los Angeles: Yesteryear Books, 1994.
Edsel." Search.com. 2007. Internet. Retrieved at http://www.search.com/reference/
Edsel.
Ervin, Kathleen a. "Auto Biography: Failure Examines the History of the Edsel."
TeslaThe company that I identified in this case is Tesla. In basic terms, Tesla is U.S. company that concerns itself with not only the design and development, but also the manufacture and sale (as well as lease) of electric vehicles and energy generation and storage systems, and offers services related to its sustainable energy products (Reuters, 2021). The company operates in the automobile industry. In essence, the U.S. automobile industry happens to be rather competitive and comprises of a number of players with the main players being inclusive of Ford Motor Company, General Motors Company, and Chrysler. Collectively, these are referred to as the big three automobile manufacturers in the U.S. Having been incorporated in the year 2003, Tesla has been in operation for the last 18 years. It is, however, important to note that it was not until Elon Musks entry (via purchase of majority stake in the…...
mlaReferences
Congressional Research Service (2021). Motor Vehicle Safety: Issues for Congress. https://sgp.fas.org/crs/misc/R46398.pdf
Higgins, T. (2021). Power Play: Tesla, Elon Musk, and the Bet of the Century. Knopf Doubleday Publishing Group.
Isidore, C. (2021). Elon Musk admits Tesla has quality problems. https://edition.cnn.com/2021/02/03/business/elon-musk-tesla-quality-problems/index.html
Chrysler-Fiat alliance has been particularly fruitful and this has likely come as a surprise to many, considering that in the international automotive environment both companies have lost significant ground at particular times in their history. Managers on both sides of the Atlantic seem to have a complex understanding of the attitudes required in order for the company to be successful and make use of these respective behaviors effectively. Chrysler in particular experienced a lot of progress as a consequence of its role in the alliance. This is likely due to the general public starting to perceive the company differently from how it was until recent years (Chrysler is no longer the typical American motor company that has trouble integrating in other markets).
Question 2
Fiat was typically seen as an auto company focused on producing small cars for the European market. As the company comes to put its logo on larger and…...
mlaBibliography:
Loska, T. "Strategic Alliances: The Renault & Nissan Alliance - Celebrating 10 Years of Synergies." (GRIN Verlag, 2013)
Introduction
Automatic vehicles are used across the globe for transportation from one point to another. The automotive industry comprising of passenger vehicles and heavy-duty trucks are a key source of pollution the in the world, comprising of ozone, particulate matter, in addition to other smog-forming emissions. Notably, passenger vehicles are a key contributor to pollution, generating substantial amounts of nitrogen oxides, carbon monoxides, in addition to other pollution. Statistics indicate that transportation constituted more than 50 percent of the carbon monoxide and nitrogen oxides, as well as approximately 25 percent of the hydrocarbons discharged to the air (Holdsworth, 2018). In this regard, in recent years, automotive corporations have made significant efforts to develop innovations and technologies that provide means of diminishing transportation-associated air pollution and climate change emissions. An emission reductions level from automotive vehicles is pivotal for attaining air quality standards and safeguarding the environment.
One company that has been on…...
mlaReferences
Holdsworth, M. L. (2018). Vehicles, Air Pollution, and Human Health. Union of Concerned Scientists. Retrieved from: Strauss, K. (2018). The World\\\\'s Most Sustainable Companies, 2018. Forbes. Retrieved from: https://www.forbes.com/sites/karstenstrauss/2018/01/23/the-worlds-most-sustainable-companies-2018/#57e190a132b0Valeo. (2018). Double Dry Clutch. Retrieved from: http://www.valeo.de/en/our-activities/powertrain-systems/technologies/dry-double-clutch-358.htmlValeo. (2018). Environmental Responsibility. Retrieved from: https://www.valeo.com/en/environmental-responsability/https://www.ucsusa.org/clean-vehicles/vehicles-air-pollution-and-human-health#.W_dXTzgzbIU
Industry Specific
My industry of choice is the auto industry, and I will analyze it using the PESTEL framework. The political environment is critical to the auto industry for a couple of reasons. In most countries, the auto industry is significant, and therefore becomes politicized. The bailouts of GM and Chrysler are just two examples -- albeit extreme ones -- of the intense government involvement in the shape and size of the automotive industry. Another good example is NAFTA, which has resulted in production shifts to Canada and Mexico, but also the opening of the Mexican market. The current climate holds that the governments of the U.S. And Canada are divesting some of their control over GM and Chrysler, but will remain heavily involved in the industry, with the objective of supporting the Big Three, as well as major foreign automakers. The political environment also shapes demand conditions. For example, high…...
Industry and Firm Analysis
Bennett, J. (2016). Fiat Chrysler to Build Parts Distribution Center in Virginia. Wall Street Journal. etrieved 25 May 2016 from: http://www.wsj.com/articles/fiat-chrysler-to-build-parts-distribution-center-in-virginia-1463662804
Fiat Chrysler Automobiles NV is investing $12.2 million to build a new distribution center in Virginia amid growing demand for parts used by its dealerships to both repair and customize its vehicles.
The 400,000-square-foot Mopar distribution center, located in Winchester, will employ about 70 people and ship more than 9.2 million parts and other items annually. This will be the 22nd center Fiat Chrysler has in operation in North America. It will primarily supply more than 200 dealers in the mid-Atlantic region after it opens sometime in the fourth quarter.
Mopar is the hidden gem of the Fiat Chrysler operation. Currently, the unit distributes more than 500,000 different parts and accessories to more than 150 markets around the world. That number is only expected to continue to grow since…...
mlaReferences
Flak, A. (2014). Fiat Chrysler to spin off Ferrari, issue $2.5 billion convertible bond. Reuters. Retrieved 26 May 2016 from: http://www.reuters.com/article/us-fiatchrysler-ferrari-divestiture-idUSKBN0II1DB20141029
Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting, (6th Ed.). Hoboken, NJ: Wiley.
Bennett, J. (2016). Fiat Chrysler to Build Parts Distribution Center in Virginia. Wall Street Journal. Retrieved 25 May 2016 from: http://www.wsj.com/articles/fiat-chrysler-to-build-parts-distribution-center-in-virginia-1463662804
Sylvers, E. (2016). Fiat Chrysler Finds New Boss for Alfa Romeo, Maserati. The Wall Street Journal. Retrieved 26 May 2016: http://www.wsj.com/articles/fiat-chrysler-finds-new-boss-for-alfa-romeo-maserati-1464088964
1. The Future of Transportation: The Rise of Electric Cars
2. Embracing Sustainability: The Benefits of Electric Vehicles
3. A Greener Option: The Environmental Impact of Electric Cars
4. The Evolution of Electric Vehicles: From Concept to Mainstream
5. The Driving Force of Change: How Electric Cars are Reshaping the Automotive Industry
6. Charging Ahead: Exploring the Technology Behind Electric Vehicles
7. Cruising Towards a Clean Energy Future: The Growing Popularity of Electric Cars
8. Powering the Change: The Infrastructure Needed for a World of Electric Vehicles
9. Electric Cars: The Solution to Combating Climate Change
10. The Electric Revolution: How Electric Cars are Driving Towards a Sustainable Future
11.....
Electrifying the Future: Captivating Titles for Your Global Electric Car
Introduction
The automotive industry stands on the cusp of a transformative era, with electric vehicles (EVs) poised to revolutionize transportation. As you embark on the journey to introduce your global electric car, a compelling title serves as the cornerstone of your marketing strategy, captivating the attention of potential customers and igniting their imaginations. Here's a comprehensive guide to assist you in brainstorming catchy and impactful titles that will set your EV apart in the global marketplace:
1. Highlight the Revolutionary Nature of Your EV
E-volution: Evoking the transformative power of electric propulsion, this....
Brazil's Economic Wealth
Brazil, the largest country in South America, boasts a diverse economy with significant wealth and natural resources. However, despite its economic prominence, Brazil faces substantial challenges related to inequality, poverty, and socioeconomic disparities.
GDP and Economic Indicators
Brazil's gross domestic product (GDP) is the ninth largest in the world, reaching over USD 1.6 trillion in 2022. This represents a significant contribution to the global economy. Brazil's GDP per capita is around USD 7,600, placing it in the upper-middle-income category.
The country's economic growth has been driven by several factors, including its abundance of natural resources, such as oil, minerals, and agricultural....
1. The Evolution of the Automobile Industry: From Horseless Carriages to Electric Vehicles
2. The Impact of Automobiles on Modern Society: Transportation Revolution or Environmental Hazard?
3. Automotive Safety: Innovations and Challenges in Creating Safer Cars
4. The Role of Autonomous Vehicles in Shaping the Future of Transportation
5. The Economics of Owning a Car: Calculating Costs and Benefits
6. Car Culture and Identity: Exploring the Symbolism of Automobiles in Popular Culture
7. The Environmental Consequences of Automobile Emissions: Can Electric Cars Save the Planet?
8. The Psychology of Car Preferences: Exploring the Factors that Influence Car Buying Decisions
9.....
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