The Global Car Industry Case Study Essay Example | Topics and Well Written Essays - 2000 words

The worldwide Car Industry Case Study - Essay ExampleIn developing countries, governments be seen to powerfully favor the development of the simple machine industry as it generates revenue through taxes and employment. China and Indias political sectors ar seen to expand their infrastructure in order to support industrialization and the juicyer demand for durables such(prenominal) as cars. However, in industrialized economies with population having larger purchasing powers, governments are more concerned with the wardrobe bares of sustainable development and environmental preservation. Economic The difference in the economic situation of various nations exit be having different effects on the markets of the global car industry. The United States is forecasted to outpace the Euro Zone in terms of economic addition while the whole Asia Pacific will be experiencing robust growth except for Japan. In general, it should be noted that growth and wage levels are expect to be slugg ish in the real terms in the immediate future. This, in turn, can lead to low consumer authority which is expected to suppress demand for new cars while encouraging the retention of old ones or twist to the second hand market. This bleak outlook is even coupled with the fact that most countries are employing tighter insurance measures which squeezes the consumers disposable income through grittyer taxation schemes. Social One of the social factors which have a high impact in c...However, this level of nationalism is expected to be eroded by the subsequent development in education, travel, and integration. Technological Technological developments have greatly contributed to the improvements in process, design, and efficiency of car manufacturers. It is expected that scientific innovations in the global auto industry will focus on reducing the environmental hazards and contaminant caused by emissions. Fuel cell technology will also become the most important issue for car manufac turers. The widespread use and popularity of using robots in production will also affect the job preference of auto makers.Environmental Environmental issues are increasingly becoming important in the decisions and operations of car manufacturers worldwide. It is expected that environmental concerns will force automakers to concentrate their efforts in producing cars with less emissions. Legal Currently, there are no legal issues and concerns faced by the global car industry. However, it can also be expected that automakers will be faced with the issues of sovereignty in light of the increasing globalization. 5-Forces Model of Competition Barriers to penetration/Exit Moderate The barriers to entry in the global car industry are high cod to high costs of initial investment, required aggressive marketing strategy to combat incumbents, and required high costs of research and development. However, this is balanced by the encouragement of the foreign direct investments in major market s worry China and India through fiscal incentives. In Russia, the barrier to entry is quite high because of the policies put in place by the state.