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Ford and the Automobile Industry Essay

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Ford and the world Auto-mobile industry 2012

Ford And the world Auto-mobile industry 2012

Name: Lakna Peththawadu Stage: 2 Date of completion: 30/11/2013

Page 1

Ford and the world Auto-mobile industry 2012
1) The world automobile industry has experienced low profitability during the past two decades. What features of the industry have caused intensify competition and low profitability? The automobile industry was the homeland of major management concepts that made significant changes in the world economy. For an instance Henry Ford’s mass production and later lean production techniques brought to light by Toyota as a means of catering to tremendous changes requiring flexibility and efficiency. Being the guru of the management techniques, the automobile industry yet face declining profitability owing to its own inherited inefficiencies. As per the above discussion, the main source of falling profits is the industry structure itself. By 1995 the automobile industry had many suppliers; where most of them were under utilized as too many supplies were chasing too little demand. But a story with emergence of BRIC economies they saw chances of increased sales. However, given profitable market this led to new management being born within those nations it self which further worsened the situation. So the world automobile industry is highly saturated and concentrated. (Table 1) This led to idling capacity and falling returns on equity. Latest trend of, alliances has somewhat aided recovery. Nevertheless, the financial crisis, which was spreading in Europe having its implications on the rest the world, has its own say on declining incomes and rising unemployment rates specially Europe caused people to scrap off their comfortable lives and be more economical figure and move on further options on transport that would be discussed further in the essay. In addition to this the falling Indian rupees caused severe damaged to manufacture of Indian which is one large...

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