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Automotive Industry Report

Automotive Industry Report. SOM-498-003- Dr. Masoud Yasai Created By: Faraz Uddin, Daniela Maldonado, Tram Vo, Jake Himan & D. Abbey. Industry Performance. The automotive industry is one of the most vital forces in our global economy The global automotive industry grew by 21% in 2010

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Automotive Industry Report

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  1. Automotive Industry Report SOM-498-003- Dr. MasoudYasai Created By: Faraz Uddin, Daniela Maldonado, Tram Vo, Jake Himan & D. Abbey

  2. Industry Performance • The automotive industry is one of the most vital forces in our global economy • The global automotive industry grew by 21% in 2010 • The industry is valued at $1,184.6 billon • Projected to grow by 38.6% by 2012

  3. Industry Performance • Profits have mainly suffered do to the global recession and energy concerns • Car’s must now not only look stylish, but provide good gas mileage and be good for the environment • Car companies had to revamp their lineup to meet the standards of our new global taste: Style, Reliability, Eco-friendly, & Gas-friendly

  4. Key Industry Characteristics • The U.S automobile industry is a 493 billion dollar industry. • Light Car Sales in the U.S • 16.1 million units in 2007 • 13.2 million units in 2008 • 10.4 million units in 2009 • 12 million (expected) units in 2010 • 14.3 million units in 2012

  5. Major Competitors Based on Market Share

  6. Nature of Competition • The global automotive industry is very competitive • Style, Quality, & Cost are major factors

  7. Global Impact • The USA accounts for 1/5 of the global market share • China and India and other emerging countries will be seeking new cars in the future

  8. Socio-Cultural • Due to the global recession many auto companies have been struggling • To help boost sales many companies have to differentiate there products • Prices incentives, stylish looks, and impact on the global environment affect consumers decisions

  9. Generic Industry Structure • The automotive industry is a maturing industry • Most companies use product differentiation as their main strategy

  10. Porters Model: Suppliers • The issue with many companies is the rising cost of raw materials • Metals, Leather, etc. • This leads to a higher price for consumers • Inflation and the job market are going to be major factors for consumers

  11. Substitutes • There are so many automakers to suit the taste of many consumers • Whether you want a fuel-efficient car or a luxury there is a brand for you

  12. Buyers • Buyers have become very smart when shopping for cars with the advent of the internet • The taste’s of buyers have changed from the 90’s when big bulky cars where in • Now most consumers prefer small eco-friendly vehicles.

  13. Potential Entrants • Entry into the automobile business is very tough • The market is very saturated • The only notable companies to make a dent is Hyundai and Kia from Korea • These two companies crept their way into the market by foregoing a cost leadership strategy

  14. Complementors • Gas Prices • Raw Materials: Metals, Glass, etc. • Government Incentives • IPod & GPS

  15. Conclusion • Although The global economy is suffering, the auto industry is growing • The global population will grow to 7 billion people • One day each one of them may want to buy a car • Emerging countries with growing economies will seek mobile workers who need cars to get form point A to point B

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