The Automotive Industry Essay

1111 words - 5 pages

The Automotive Industry Recovery

Prepared for:


Transmittal Letter

TO:
FROM:
DATE:
SUBJECT: Report Overview

The following report discusses the automotive industry recover from the “Great Recession” that occurred in 2008/2009. Information presented will be the state of the automotive industry before the recession, after the recession, how the industry is doing now and how the future looks for automakers.


Contents

The Automotive Industry Recovery 1
Transmittal Letter ii
Contents iii
Figures iii
Executive Summary iv
Introduction 1
Finding 1
Pre-Recession 1
Post Recession 2
How is it now? 3
The Future Outlook 3
...view middle of the document...

FINDING
The automotive industry is making a comeback in America but it’s not quite back to its glory. Each year automakers are selling more, making more, and hiring more employees.

PRE-RECESSION
The automotive industry in America was a strong force in the economy. Employing over 1.1 million people in a very large supply chain, the success of the industry had great effect spreading across the country. Sales were climbing upward to 17 million vehicles a year, the most ever in the history of the automotive industry (Automotive Industry: Employment, Earnings, and Hours, 2014). Auto makers were heavily relying on the sales of their trucks and SUVs which brought them a 15 to 20% profit compared to just 3% or less on cars.

POST-RECESSION
In 2008, the economies struggle was apparent to the auto industry. Vehicle sales dropped to just 10.4 million vehicles in 2009, more than 5 million less than 2 years before as seen in Figure 1 (Holecek, 2014).
Automotive industry workers lost jobs with employment falling to under 624,000 (Automotive Industry: Employment, Earnings, and Hours, 2014). With the recession and financial crisis combined with the sky-rocketing price of oil, the automotive industry about collapsed. Sales decreased by a dramatic 40% as Americans loss access to credit and car loans. The Bush Administration provided $17.4 billion dollars in bridge loans to the Big 3 for a temporary fix leaving the problem for Obama the following year. In 2009, GM and Chrysler submitted plans to Obama to receive help from the government to get their companies back on track. Obama denied giving money to the automakers initially and urged them to make drastic changes. At this point automotive jobs in the U.S. dropped to 653,000 as a result of sales dropping to 10.4 million vehicles, a 15 year low, ultimately leaving GM and Chrysler to file for bankruptcy. A short time later the “Cash for Clunkers” program was launched which gave $3500 to $4500 in bonuses to buyers for trading in their older vehicles. It is estimated that 35% of buyers would have not replace their vehicles without this program. By the beginning of 2010, both GM and Chrysler repaid their loans to the U.S. Treasury (The Resurgence of the American , 2011). At the end of 2010 into the beginning of 2011, the automotive industry in the United States was back on the up rise and started to see solid increases in sales and employment.

CURRENT STATE OF THE INDUSTRY
The...

Other assignments on The Automotive Industry

International Trade And Finance Speach Essay

357 words - 2 pages eventually stop. This will to the lay-off of workers and the potential to close manufacturing facilities. Trade deficit is when the goods the U.S imports are greater than the total it exports. The automotive industry is one of the categories where the U.S. ran a trade deficit in 2011 (Amadeo, 2012). As companies are unable to sell the surplus that has accumulated, and workers are no longer working, the economy goes deeper into debt. The trade

Constraint Theory Essay

359 words - 2 pages The Theory of Constraints and the Automotive Industry The bottleneck appears in many aspects of the automotive industry. Not only is the specified branch of the manufacturer but also in more specific branches of products such as locally owned dealers, individual parts suppliers, and then on the consumer service side, repair shops. Looking at all of these some bottlenecks or constraints are easily identifiable. For this I will look closer at

Bandag

1563 words - 7 pages MGMT 315 - Human Resources Management Bandag Automotive Automotive Parts Distributor to improve Human Resources function Introduction/ Executive summary Customer name: Bandag Automotive Location: Illinois, United States Industry: Automotive supplies – distribution and retail Employees and Customers * 300 employees * 5 retail stores * Service stations * Repair shops Organization chart Customer Profile Bandag Automotive is a

Badm

682 words - 3 pages Examen #1 1. Are the Chinese domestic vehicle producer’s strategies good enough to be implanted in another country? With this few arguments is very difficult to determine if the strategies used by the Chinese are good enough to be implemented in another country. What is true is that the automotive industry in China represents an extraordinary case of industry development. In recent years, China has become the world’s fastest growing

Conclusion And Future Model For Supply Chain - Toyota

528 words - 3 pages Conclusions and Future Model The auto industry has been a global business for a long time. The last few years how much a problem in just one of those regions, however, can affect everyone in the industry. When assessing the strengths and the weaknesses the most prevalent issues arise around demand for the product and external factors. Demand Risk Demand risk is the downstream equivalent of supply risk and is present on the demand/outbound

Marketing Plan

3997 words - 16 pages ). These components allow AAA the opportunity to market themselves beyond their current membership. For example, on Earth Day 2000, AAA clubs collected 7,500 used batteries and properly disposed of them to keep landfills clean (AAA MountainWest, 2013). AAA has a long-standing history of automotive and travel products and services for its members. Despite the history of consumer satisfaction, AAA has also shown a community commitment in its

Garmin

1739 words - 7 pages devices is to enrich the lives of their customers, by providing high quality products that create value for consumers. Classified as a technology and scientific instruments company, it operates in five business sectors which serve the marine, outdoor, fitness, automotive, and aviation markets. The company advances the idea of their superiority in value and performance, ease of use, innovation, and ergonomics of its products, and offers an

Government Should Give Subsidies Manufacturesto

321 words - 2 pages In this essay am going to agree that the government should give subsides to car manufactures. In recent days there is a lot happening regarding car manufacturing industries.We see business being taken over by other shareholders overseas and the common news which we hear every day that is cutting jobs. If the government does not provide the automotive industry with enough assistance, the companies will easily go to liquidation. In my opinion this

Diamond Model Of Porter With Reference To Indian Automobile Industry

1907 words - 8 pages sustain growth in the automotive sector, a roadmap is needed to steer, coordinate and synergize the efforts of all stakeholders. Exogenous and endogenous factors affecting industry also affects the competitiveness of the firms. Competitiveness captures the awareness of both the limitations and the challenges posed by global competition as an exogenous factor. Underdeveloped economies tend to be competitive by producing cheaper products

Indian Auto-Component Supply Chain At The Crossroads

281 words - 2 pages Balakrishnan, K., Seshadri, S., Sheopuri, A., & Iyer, A. (2007). Indian auto-component supply chain at the crossroads. Interfaces, 37(4), 310-323. Brief Overview In this article Balakrishnan, Seshadri & Sheopuri attempted to trace the evolution of the auto-component supply chain in India. This paper examines the determinants of competitiveness for Indian automotive component manufacturing industry, in special context to its supply

Sks Manufacturing

305 words - 2 pages Introduction SKS Manufacturing has recently hired Deloitte & Touche as they are in a critical cash position with various internal inefficiencies in their procurement and production processes. Deloitte & Touche and SKS Manufacturing will need to work together in order to solve the issues present at SKS Manufacturing so they can be successful within the automotive parts industry. Issues & Analysis There are three key issues that are present

Similar Documents

Scm In Automotive Industry Essay

3533 words - 15 pages features of Toyota business model 7 Drivers of supply chain 8 Parts Ordering 9 Parts and Supplier Master 9 Forecasting 9 Toyota distribution model 10 Best practices 10 COMPARISON 10 ISSUES 11 RECOMMENDATIONS 12 REFRENCES 13 INTRODUCTION The Indian automotive industry, comprising vehicle and component manufacturers, has grown steadily since the economic liberalization of the early 1990’s. The arrival of major

Automotive Sector Essay

1677 words - 7 pages . The manufacturers focus on satisfying Price sensitive consumer segment produce vehicles with low fuel consumption sold at affordable prices. For driving enthusiasts, automobile manufacturers produce cars with different accessories and techniques (racing seats, high acceleration technologies, good roadholding etc.)” Automotive industry product segments consist of Light Commercial Vehicles, Heavy Commercial Vehicles and Passenger Vehicles. The

Automobile Industry In Uk Essay

1134 words - 5 pages specialist brands and niche manufacturers. Some of the best premium and sports cars manufactured in UK are Aston Martin, Bentley, Daimler, Jaguar, Lagonda, LandRover, Lotus, McLaren, MG, Mini, Morgan  and Rolls-Royce. UK automotive industry is producing over 1.5 million vehicles and 2.5 million engines every year. Another key point about the UK automobile industry is that it exports around 75 % of its production which makes UK the largest exporter

Toyota Motor Company Essay

391 words - 2 pages name and competitive position in automotive manufacture industry(S3,02) | 1. Closely monitor quality and overhaul its design and manufacturing operations to enter growing global automotive industry (W1,W4,O1) 2. Joint venture with GM cause Toyota strive for continuous improvements and enhance the sales and market share in particular geographic market(W2,02) | Threats | ST Strategy | WT Strategy | T1: Facing intense competition in