The global recession resets the landscape for automotive industry. The giants in the car manufacturing business have suffered disappointing demands and sales. While the automotive industry has suffered recession for the past years, it is still one the most significant sectors in the world by revenue.
The increase on oil prices in the 1990s has caused many people to switch away from vehicles that are high dependent to more compact and lighter cars. In the U.S., sales of cars have dropped significantly as more and more people have preferred to buy more compact and lighter cars that are more fuel efficient. In 2008 financial crisis, the automotive industry has suffered a lot, and the huge car manufacturing companies such as the General Motors, Chrysler, and Ford needed billions of dollars from the government to bailout funds.
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In the recent year, the U.S. automotive industry has recorded the highest sales of 3, 689, 089 cars. A new technological decade ha s unfolded and businesses in the automotive industry are gearing up to emerging trends.
Governments Will Regulate the Necessity for Much Cleaner and Safer Transportation – Due to safety concerns, governments worldwide are focusing on three areas; safety, preservation of resources, and environmental capability. This will prompt car manufacturers to create a diverse range of cleaner and safer vehicles, specially the zero-emission cars. While in the other hand, consumers will weight their buying decisions based on the incentives and penalties.
New Players Are Expected to Set Foot in the Automotive Industry -The advancing technology, the evolving consumer’s needs, and the introduction of Automotive IT solutions have paved entrance for new players to set foot in the automotive sector. Businesses models such as mobility integration, advanced car entertainment systems, and driving performance evaluation will become an integrated part of the automotive industry value chain.
Social Media Initiatives Will Have Huge Impact on Automotive Marketing – Marketing for vehicles have become more social. Consumers these days are becoming wise shoppers and they are doing a thorough research before deciding which brand and model of vehicles to invest in. The eases of access to a plethora of information including the opinions of perception of other people on cars have been facilitated by social media platforms. Lately, consumers are resting their decisions based on the information they have acquired from website, blogs, and other influential online resources. At the same time, car manufacturers are taking advantage of the social media platform to develop a strong bond to consumers.
Vehicle Manufacturers Will Rationalize their Portfolios – Surviving at the recession blues, majority of the car manufacturers will focus on sustainability and profits than volume. Emerging car manufacturing companies will climb up the scale by eyeing on developed nations as their home market and build a strong global presence.
The Globalization of the Automotive Industry Will Result to the Emergence of Risks – The globalization of the automotive sector is paving way for new risks and the car manufacturers are devising radical operational strategies to mitigate these risks. The increasingly becoming volatile prices of the raw materials, the shortage of qualified workers, and the misalignment of the demand and supply have made automotive firms to implement a reality check on their globalization efforts. With these challenges, the automotive industry should implement mitigation strategies to simplify the value chain adaptation. One of the prime solutions being viewed by the automotive sector is the implementation of automotive software solutions.
The Automotive Sector and the Global Trade
Since the beginning of the 21st century, more than 48 million passenger vehicles alone have been manufactured globally. China produces one of every 4 new vehicles and more than 50% of the all vehicles manufactured in Oceania and Asia. Approximately 1 billion passenger vehicles are on the road worldwide and nearly 25% of them are registered in the U.S. The top selling vehicle in the world is the Toyota Corolla with more than 35 million sales.
Major Exporters of Vehicles
China is the world biggest producer of passenger cars, but the country is not on the top of global exporters. The largest exporters of vehicle include Japan, Germany, The United States, Canada, and the Republic of Korea.
- Japan – Japan is one of the top producers or Mazda, Subaru, Honda, and Nissan
- Germany – Germany is one of the world’s top producers of BMW, Porsche, Volkswagen, and Mercedes-Benz.
- The United States – The U.S.A. is the top producer of Ford, General Motors, and Chrysler brand of vehicles.
- Canada – Canada has become a significant part of the automotive industry due to the many car manufacturing plants in the country established by major brands such as Toyota, Ford, Honda, and Chrysler.
- Republic of Korea – Over the past decade, South Korea has become one of the largest exporters of passenger vehicle, thanks to the association between GM, Hyundai, and Daewoo Motors.
Major Importers of the Vehicles
Many countries are now producing domestic brands of vehicles, but automobile import is still strong in economies. The top importers of vehicles are following.
- The United States – Ford, General Motors, and Chrysler are the top brands of automobile in the U.S., but the country is bringing more compact and lighter vehicles from other lands. The United States is among the top importers of the Toyota Corolla and Camry, the Honda Civic and Accord, and the Nissan Altima.
- Italy – Italy is among the major importers of the Ford Fiesta, the Volkswagen Golf, and the French Citroen C3.
- United Kingdom – Aston Martin, Rolls Royce, and Bentley are the popular brands of cars in UK, but French Peugot, Volkswagen, and Ford are often seen in the roads in the country.
- Germany – In 2011, German brands has dominated the domestic sales in Germany. But, foreign models have become in demand in the country, which makes Germany the top importers of Hyundai, Ford, and Skoda.
- France – The French have strong commitment to domestic brands such as the Peugot and Renault. But, France is one of the top importers of foreign models such as the Romanian Dacia, Volkswagen, and Ford.