The automobile industry touches our lives in many ways. Almost every car trip ends with either an economic transaction or another benefit of our quality life. According to SIC3711.3713, Automobile industry includes new on- road volume-produced completed vehicles that carry cargo and passengers (U.S Industry &Trade Outlook 2000). It manufactures passenger cars, trucks, commercial cars and buses. It also contains other kinds of business that provides services to automobiles, such as maintaining and repairing, car dealer, car shipment, etc.
The auto industry is among the biggest industry in the economy world. Global sales of automobiles averaged 50 million units annually in the 1990s, and by the year 2000, this figure had already grown to nearly 60 million units (Encyclopedia of global industries, second edition, Scott Heil editor, HD2324.E53 Ref). It creates 6.6 million direct and spin-off jobs and produces $243 billion in payroll compensation in U.S.A, according to a 2001 report on the "Contribution of the Automotive Industry to the U.S. Economy" prepared by the University of Michigan and the Center for Automotive Research (CAR). More than 3.7% of US's total gross domestic product (GDP) is generated by this industry.
(Source: http://www.autoalliance.org/umstudy/quickfacts.htm). .
B) Market .
The global automobile market can be divided into roughly six segments: 3 mature markets and 3 relatively new markets. Western Europe, North America and Japan were dominant in the 1990s. They accounted for 75% of global motor vehicle production and sale (Encyclopedia of global industries, second edition, Scott Heil editor, HD2324.E53 Ref). However, in the 21st century, Eastern Europe, the Pacific Rim and Latin America present a rapidly developing secondary consumer market. Nearly all of the industry's future growth will come from the three emerging markets.
c) Operations and trends.
Because of the concentration of production, the industry is characterized by intense competition.