The marketing, manufacture, development, design, and sales of motor vehicles are the main objectives of the automotive industry. The automotive industry manufactures and sells millions of vehicles every year all over the world. The industry is currently experiencing a change in consumer buying habits and price increases for raw materials because of a steady and sharp increase of oil prices never before experienced to this degree. As a result, most consumers are also changing their vehicle usage habits. This greatly affects the automotive industry.
Because of the oil crisis in 1973, many car users in the United States opted for smaller cars that had greater fuel economy. Historically, most Japanese preferred small, fuel-efficient cars. This made the Japanese improve the quality of these small cars that have now become very popular the world over, especially with current oil prices skyrocketing on a daily basis.
Toyota is a household name all over the world and has several manufacturing plants that are strategically positioned to serve its global clientele. There has been considerable investment in the development and manufacture of more environmentally friendly vehicles to counter global warming, caused in part by carbon emissions from cars. Toyota alone invested 15 billion dollars to employ an impressive 35,000 employees in the United States alone. This shows just how massive the automotive industry is in the world economy.
The second largest automotive manufacturer in the world is General Motors Corporation (GM) with its headquarters in the United States. Global industry sales rated GM as the world’s largest automobile manufacturer on January 1, 2008. General Motors makes its cars in 35 different countries, with a total work force of nearly 284,000 people. It manufactures some of the world’s most famous brands such as Cadillac, Opel, GMC, Hummer, and Chevrolet, among others. Working Mothers’ magazine named General Motors as one of the best companies for working mothers in 2004. GM also developed special programs to improve the quality of life for its employees. These programs provide medical care, tuition assistance, education, and diversity issues for all GM employees, in addition to the usual joint union-employer health benefits and safety programs.
Another big player in the automotive industry is the Volkswagen group, started in the year 1937. Initially, the Volkswagen Beetle didn’t have many admirers as it was perceived by some as less aesthetically attractive than other cars, and some claimed that it didn’t meet basic technical requirements for a modern vehicle. In July 1985, Volkswagenwerk changed its name to Volkswagen AG to increase its global appeal. Volkswagen is currently ranked as the third biggest car maker in the world, and the leader in Europe, with Porsche having a 51% controlling interest in the company. Its most well-known brand is Volkswagen, while some of its subsidiaries include Skoda, Audi, Porsche, Lamborghini, and Bentley. China is Volkswagen’s second largest market worldwide. Selling over 25 million cars in 2006, the Volkswagen Golf is the third best-selling car in the world, with the intention of hitting the number one spot in the automotive industry by the year 2018.
Volkswagen’s workforce totaled over 200,000 in 2007, and continues to grow. Volkswagen employees enjoy flexible working conditions. This makes it hard for the employees to leave for another company; Volkswagen has a higher employee retention rate than many of its competitors.
The Volkswagen group comprises nine active companies with their respective brands. The companies Auto union GmbH and NSU GmbH retain and manage the Heritage names, which are completely owned by Audi. Volkswagen has a 38% controlling share in Scania AB, the Swedish commercial car manufacturer.
Ford Motor Company is the fourth-largest car manufacturer in the world, based on global sales. Based in suburbs of Detroit, it was founded by Henry Ford. Ford has several shares in many different automotive companies, like Mazda of Japan, where Ford possesses one third of its controlling shares, Volvo of Sweden, and England’s Ashton. Due to the high demand for fuel-efficient cars, Ford has changed the type of vehicles that it produces to meet current market demands.
This is the reason why it has changed from its legendary body-on-frame chassis to the uni-body car platforms employed by vehicles such as the Crossover SUV. Ford Company recently suffered the largest loss in its history of 12.7 billion dollars, and management thought that it would not be profitable until 2009. For the sum of 2.3 billion dollars, Tata Motors agreed to buy both Jaguar and Land Rover from Ford in March 2008. Unfortunately, 30,000 jobs will be lost as 14 factories will be shut down by Ford due to restructuring. All this is being done to return the company to profitability. Since 2003, Toyota has been selling more cars than Ford. In 2006 Toyota also overtook Ford as the number two automobile manufacturer, in sales, in the United States. Seeking to license hybrid technology from Toyota Motor Corporation, The Ford Motor Company could further lend its influence to make Toyota’s system eventually become a requirement for every manufacturer in the automotive industry.
