People all around the world use cars and trucks to transport themselves and their goods from place to place, so analyzing the auto industry gives insight into hundreds of millions consumers worldwide. Since there are cars in nearly every country, the supply and demand of automobiles greatly increases each year, as people want a faster, more convenient way of travelling. At the same time, emissions from automobiles add to the growing pollution in the environment, which also affects people around the world. Since environmental change and automobile use are directly linked, the environment and climate change, as well as ideas to pursue new regulations, have a strong impact on the auto industry.
Based on the case analysis of the auto industry (Highfill, David, et al., 2004), there are many ways in which the auto industry has changed in recent years. Regulations are not just a recent development: since 1960, according to Highfill, regulations from the government affected the industry. Many of these changes are for safety and environmental reasons, and these new regulations still occur today. Since so many people want to buy large vehicles in order to travel, and the population of the world keeps increasing, every country has its own demand for vehicles. Some places require different types of cars than others: smaller cars are popular in South Korea, while big vehicles are common in the USA. In order to combat this trend of buying large cars, some cities have started banning types of cars: according to Highfill, the city of Paris wants to ban SUVs from inside the city limits, because they take up too much space and use too much fuel. This is a great way for cities to take action to reduce the negative impact on the environment that most automobiles have.
There is significant global competition in the industry, but only between a handful of groups that dominate the markets. In the USA, the auto industry is the biggest consumer of computer chips, certain metals, textiles, plastics, vinyl, and rubber (Highfill, 2004). Because of all the jobs necessary to create these cars, sales of automobiles are almost four percent of the GPD in the USA, which is a huge percentage for one industry! Other companies around the world are Volvo, Toyota, Saab, Aston Martin, BMW, etc. Since different countries want different types and brands of cars, certain car companies tend to be popular in one place or another. Kia trucks are common in South Korea, since they’re small enough to get through narrow alleyways that SUVs could never pass through. In contrast, large semi-trucks are typical in the USA, because they need to carry large amounts of goods long distances on highways. This requirement in different countries helps the consumers choose to support certain auto companies over others, but since there is such a variety in choice, all the companies stay relatively stable.
New technology plays a major role in the auto industry. The push for alternative fuel vehicles and...