The automobile is a primary mode of transportation for many developed economies. About 250 million vehicles are in use in the United States. Around the world, there were about 806 million cars and light trucks on the road in 2007, consuming over 260 billion US gallons (980,000,000 m3) of gasoline and diesel fuel yearly. What are the main conditions for a well-developed Auto industry? Basic and key reasons for any successful Auto business are:
- Stable business and political environment (NAFTA member)
- Highly developed technical base
- Highly educated workforce, good access to university graduates with technical education
- Strategic position
- Production costs
- Employee salaries
- Automobile dealers
- Auto parts, accessories, and tire stores
- Promoting the product, such as advertising, billboards
Sources
(1) http://www.hybrid.cz/1-miliarda-tolik-dnes-jezdi-po-svete-aut
(2) http://www.czechinvest.org/en/1automotive-industry
(3) http://en.wikipedia.org/wiki/Automotive_industry
(Image) http://www.fashionera.in/website/fashionera/gift/automobile/automobile%20industry.htm
2 comments:
Monika you laid out some valuable information in a very comprehensive way, nice job! Something that stuck out to me was talking about the industry itself, and the successful components needed in order for it to run efficiently. What you listed: "Business/political environment, high technical base, educated workforce, and strategic position" are all very difficult goals to achieve overnight. So another point that may be important in your future analysis of the auto industry is how difficult it is for new companies to enter into the market. Think about the amount of capital, economies of scale, and investment it takes to run an auto company in the U.S. These 'entry barriers' will be important for companies when developing a strategy in their business in order to compete with other major companies.
@EaSeidell - Interesting you mention the barriers to entry to the Auto industry. This coming week I will be researching and writing a draft for the Entrepreneurship section of our final paper. I haven't done all my research yet, but the direction in which I want to go is looking at different start-ups trying (and often failing) to break those barriers, especially in the alternative vehicle segment (Tesla Motors and other lesser-known companies).
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