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Archive of posts published in the category: BERA
May
8

BERA: Issue 2 Automotive Industry: Global Automotive Industry

Increasing global trade has enabled the growth in world commercial distribution systems, which has also expanded global competition amongst the automobile manufacturers. Japanese automakers in particular, have instituted innovative production methods by modifying the U.S. manufacturing model, as well as adapting and utilizing technology to enhance production and increase product competition.

There are a number of trends that can be identified by examining the global automotive market, which can be divided into the following factors:4

Global Market Dynamics – The world’s largest automobile manufacturers continue to invest into production facilities in emerging markets in order to reduce production costs. These emerging markets include Latin America, China, Malaysia and other markets in Southeast Asia.

U.S. automakers, “The Big Three” (GM, Ford and Chrysler) have merged with, and in some cases established commercial strategic partnerships with other European and Japanese automobile manufacturers. Overall, there has been a trend by the world automakers to expand in overseas markets.

Industry Consolidation – Increasing global competition amongst the global manufacturers and positioning within foreign markets has divided the world’s automakers into three tiers, the first tier being GM, Ford, Toyota, Honda and Volkswagen, and the two remaining tier manufacturers attempting to consolidate or merge with other lower tier automakers to compete with the first tier companies.

1st Tier Company Mergers – Volkswagen-Lamborgini; BMW-Rolls Royce
2nd Tier Company Mergers – Chrysler-Mercedes Benz; Renault-Nissan-Fiat
3rd Tier Company Mergers – Mazda-Mitsubishi; Kia-Volvo

This section presents literature that examines three major automotive markets in North America, Europe and East Asia. This material is intended to provide a thorough examination of industry trends, structure, and the effects of global market dynamics of the automotive industry within each region, as well as their interrelationships, followed by literature researching the East Asian automotive market.

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Research on the Global Automobile Industry

The Beyond BRIC Auto Markets: A Close Look at Four Clusters: An In-Depth Look at the Challenges and Opportunities. Boston Consulting Group, October 22, 2013.
https://www.bcgperspectives.com/content/articles/…_close_look_four_clusters/ External Link

The full report is only available to subscribers but this is looking at BRIC countries – Brazil, Russia, India and China.

Fitch Solutions
https://store.fitchsolutions.com/autosExternal Link

Fitch Solutions (formerly BMI) produces industry reports by country available for purchase online.

Global Auto Report Scotia Bank, March 13, 2017.
http://www.gbm.scotiabank.com/scpt/gbm/scotiaeconomics63/GAR_2017-03-13.pdf External Link [PDF format: 287 KB/9 p.]

Brief overview of the automotive industry worldwide.

Hashmi, Aamir Rafique and Johannes Van Biesebroeck. Market Structure and Innovation [electronic resource] : a dynamic analysis of the global automobile industry. Cambridge, MA : National Bureau of Economic Research, c2010.
LC Catalog Record: 2010655999
Full text on NBER web site External Link

This is a study of the relationship between market structure and innovation in the global automobile industry from 1982 to 2004.

Hiraoka, Leslie. S. Global Alliances in the Motor Vehicle Industry. Westport, CT: Quorum Books, 2001.
LC Call Number: HD9710.A2 H57 2001
LC Catalog Record: 00037269

This study examines the origins, consequences, and trends of globalization in the motor vehicle industry, with chapters on transplants from Japan, US recovery, the DaimlerChrysler merger NAFTA,