The Impact of Globalization on the US Automotive Industry

In the contemporary China’s economy, it is no doubt that Auto parts Industry has become one of the fastest growing industries which plays a major role in the development of the domestic manufacture as well as the GDP Growth.

The American automobile industry has quite a history. From the sale of the first Ford Model A on July 23rd, 1903 (Ford Motor Company, n.d), to the first Corvette rolling off the assembly line June 30th, 1953 (http://corvettestory.com/1953-Corvette-C1-First-Year-Modest-Beginnings.php, n.d.), to the automobile crisis and bailout from 2008 to 2010, and to many other historic achievements and crisis’ throughout the lifespan of the industry.

The Effects of Globalization on Labor Relations in the Auto Industry in the 80s and 90s

The Auto Industry in the United States has flourished ever since it’s revolution in the early 1900s. “Although the blueprint for the modern automobile was perfected in Germany and France in the late 1800s, Americans dominated the industry in the first half of the twentieth century. Henry Ford innovated mass-production techniques that became standard, with Ford, General Motors and Chrysler emerging as the “Big Three” auto companies by the 1920s (Foner & Garraty 1991).” Henry Ford’s focus was to produce an automobile that could be accepted by middle class Americans. The American automobile industry is subject to global competition like any other industry. As stated earlier, the automobile was first perfected in Germany and France. In 1995, the United States and Japan made a trade agreement that provided more dealer outlets and allowed easier replacement part selling in each other’s countries (Nauss 1995). This makes auto parts and auto-replacement parts for Japanese cars easier to access in the United States and vice versa. Not only does this provide for more US jobs, but it also provides for more Japanese jobs in the auto industry (Nauss 1995)! But furthermore, it increases the global competition. “Japanese automotive manufacturers include Toyota, Honda, Daihatsu, Nissan, Suzuki, Mazda, Mitsubishi, Subaru, Isuzu, Kawasaki, Yamaha, and Mitsuoka. Cars designed in Japan have won the European Car of the Year, International Car of the Year, and World Car of the Year awards many

The 3 largest powerhouses of the United States of America automobile sector have a very good view.

The international automakers invested more than $72 billion to capitalize 425 facilities and offices. This created jobs for 123 thousand Americans with $9.3 billion and products purchased from US suppliers for $104 billion to produce 5.3 million vehicles in which 46% of all US vehicle production. There are nearly 10 thousand dealership franchises sold that employ more than 500 thousand American gaining $29 billion. Further, nearly 900 thousand US-built vehicles were exported. These figures clearly shows that there has been a domino effect of success in the US auto industry and it means that it is a great contributor to the US economy.

The American auto industry will face major competition in the next five years from Europe, China, Japan and other emerging markets. In order to remain viable U.S. auto manufacturers must continue to seek out new markets, mergers and invest in new technology.

Just like any other industry competing in the global arena for market space for their products, the American auto industry has faced and has had to grapple with many environmental challenges in its business endeavors. Over the years, it has not been business as usual nor a walk in the park for the American auto Industry. This has been due to the advent of global cut throat competition, the innovation race, collaborative strategies, and both local and international protocol regulatory framework demands such as emissions control, safety standards etc. The struggle for penetration and maintenance of foreign market shares has also tested the American auto industry`s mettle

The rapid pace of Globalization has led to a change in the global economy during the past several decades; it is believe that factors such as trade liberalisation, access to cheaper labour and resources, similarity of consumer demand around the world, and advances in technology and communication has widened the market of consumption, investment as well as production on a global scale. These globalization driven factors created new challenges and global competition for businesses around the world thus as a response many companies decided to expand their operation across national borders in order to be competitive. A company that operates their business in at least one country other than its country is called Multinational

Globalization is now present now more than ever, as it is the international amalgamation of people, cultures, and companies, derived from international exchanges mainly aided from technology. Globalization makes it easier for companies to enter and compete in foreign markets. As a result of abundant competition, it is crucial for companies to enter

* Political/Legal: The political portion of the general environment is often overlooked because businesses and people alike think that it is enough to follow the laws and abide by regulations set forth by the government. This is incorrect. Many automobile companies such as Chrysler operate in foreign countries and look to export their products to foreign countries as well. The laws and regulations in these foreign countries have to be navigated and understood just as precisely as those in the home country. In the case of Chrysler, when it was acquired by Daimler-Benz, the company had to develop a whole new outlook on its business practices. Taxation policies had to be revamped polices on the export, import, and manufacturer of

In today’s fast paced world, many would say that globalization is electrifying, bringing with it worldwide advancement and opportunities as well as economical business growth across nations. Many would also suggest that it has opened doors to the larger demographics of information and communication that crosses geographic, social and cultural boundaries. As a result of globalization, the worldwide market has expanded; bring together companies, workers, experience, knowledge and consumers, making their products easily attainable in different countries and regions. Take for instance the automobile industry, many American cars are built in other countries such as Japan but assembled here in America. Some would consider this as a partnership between both countries. The automobile company is providing employment and advancement to both countries by sharing the designing, management and production process and execution of automobiles which would be sold mainly in the United States. Another great result of globalization is the ability to unify medical and political resources during trying times such as war and to combat the spread of infectious diseases. In many incidents throughout history all participant nations medical and military armed forces have unified with other nations to protect each other 's country, investments and relationships which, if infiltrated could weaken or collapse the world’s economy.

Today automobile industry is recognized at global level. For every automobile company it is important to enter into foreign market because of increase in competition if companies will not expand their market they can face a huge loss and every company wants to grow and wants to be recognized all over the world. For example if manufacturers such as Ford, Toyota or Volkswagen expanded their market for growth if such manufacturers had still been dealing in their own country they wouldn’t have been able to generate good profit. And competing globally also helps company to learn new technologies and ideas. Therefore it is important for such automobile companies to grow globally for long term success and competitive advantage.

The main driving force behind the decision of BMW to turn to globalization was competition from global companies in Germany, the United States and Japan who are major competitors in the luxury segment. The automobile industry is highly globalised with many major manufactures operating all over the world. Automobiles built in one region are sold, with necessary changes, around the world. The main force for global convergence was the virtual disappearance of the national manufactures being squeezed out by the international giants and the standardization of markets across international boundaries. Forced by international regulatory bodies at regional level and fuelled by ever more intensive global communication.

) The economic characteristics of the global motor vehicle industry are very complex. It takes a lot of effort and a lot of moving parts to ensure continued and successful grow. For a company to maintain good economic characteristics a company must continually set out to grow their business, they must have a defined buyers, number and scope of their direct and potential rivals, product development and innovation, supply/demand relationship, technological change, knowledge and experience of the vehicle and global markets, economies of scales, and value vertical integration. All of these characteristics are vital to success in the global vehicle industry. As mentioned above, the first economic characteristic would be to grow their business and market size. These companies either expand domestically, but most importantly internationally. When expanding internationally most companies seek to enter in developing counties because of the potential future benefit. Tata motors has excelled at this tactic because they gained a humongous presence in their home country and then expanded to developing countries such as Africa, ------,--------,---------. The second example of characteristics of a global motor vehicle company would be defining their buyers. Tata has set itself apart from it competitors by offering affordable cars to the middle-income family. -------The affordable car------- The cars they offer are the most basic cars, but they suit the need of their core customers. As