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Automotive Industry Report. SOM-498-003- Dr. Masoud Yasai Created By: Faraz Uddin, Daniela Maldonado, Tram Vo, Jake Himan & D. Abbey. Industry Performance. The automotive industry is one of the most vital forces in our global economy The global automotive industry grew by 21% in 2010

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Automotive industry report

Automotive Industry Report

SOM-498-003- Dr. MasoudYasai

Created By: Faraz Uddin, Daniela Maldonado, Tram Vo, Jake Himan & D. Abbey

Industry performance
Industry Performance

  • The automotive industry is one of the most vital forces in our global economy

  • The global automotive industry grew by 21% in 2010

  • The industry is valued at $1,184.6 billon

  • Projected to grow by 38.6% by 2012

Industry performance1
Industry Performance

  • Profits have mainly suffered do to the global recession and energy concerns

  • Car’s must now not only look stylish, but provide good gas mileage and be good for the environment

  • Car companies had to revamp their lineup to meet the standards of our new global taste: Style, Reliability, Eco-friendly, & Gas-friendly

Key industry characteristics
Key Industry Characteristics

  • The U.S automobile industry is a 493 billion dollar industry.

  • Light Car Sales in the U.S

    • 16.1 million units in 2007

    • 13.2 million units in 2008

    • 10.4 million units in 2009

    • 12 million (expected) units in 2010

    • 14.3 million units in 2012

Nature of competition
Nature of Competition

  • The global automotive industry is very competitive

  • Style, Quality, & Cost are major factors

Global impact
Global Impact

  • The USA accounts for 1/5 of the global market share

  • China and India and other emerging countries will be seeking new cars in the future

Socio cultural

  • Due to the global recession many auto companies have been struggling

  • To help boost sales many companies have to differentiate there products

  • Prices incentives, stylish looks, and impact on the global environment affect consumers decisions

Generic industry structure
Generic Industry Structure

  • The automotive industry is a maturing industry

  • Most companies use product differentiation as their main strategy

Porters model suppliers
Porters Model: Suppliers

  • The issue with many companies is the rising cost of raw materials

  • Metals, Leather, etc.

  • This leads to a higher price for consumers

  • Inflation and the job market are going to be major factors for consumers


  • There are so many automakers to suit the taste of many consumers

  • Whether you want a fuel-efficient car or a luxury there is a brand for you


  • Buyers have become very smart when shopping for cars with the advent of the internet

  • The taste’s of buyers have changed from the 90’s when big bulky cars where in

  • Now most consumers prefer small eco-friendly vehicles.

Potential entrants
Potential Entrants

  • Entry into the automobile business is very tough

  • The market is very saturated

  • The only notable companies to make a dent is Hyundai and Kia from Korea

  • These two companies crept their way into the market by foregoing a cost leadership strategy


  • Gas Prices

  • Raw Materials: Metals, Glass, etc.

  • Government Incentives

  • IPod & GPS

The future
The Future

  • Key Drivers of industry change:

    • Reducing the carbon footprint

  • Future Profits

  • Industry Attractiveness


  • Although The global economy is suffering, the auto industry is growing

  • The global population will grow to 7 billion people

  • One day each one of them may want to buy a car

  • Emerging countries with growing economies will seek mobile workers who need cars to get form point A to point B