Automotive Industry Analysis in the Us
AUTOMOTIVE INDUSTRY ANALYSIS
Submitted by Team A
Donald Bradley
Morgan Bruns
Adam Fleming
Jay Ling
Lauren Margolin
Felipe Roman
Presented to:
Prof. Alan Flury
December 5, 2005
ME 6753: Principles of Management for Engineers
Team A ii
Executive Summary
Chosen industry:
This analysis focuses on the automotive industry, specifically, large-scale manufacturers of automobiles.
The automotive industry is inherently interesting: it is massive, it is competitive, and it is expected to undergo major restructuring in the near future due to globalization and decreasing oil reserves. The analysis team members (we) feel qualified to perform this investigation due to our familiarity with the industry and our educationseveral of us have studied and worked on problems associated with automobile manufacturing and we are all mechanical engineering graduate students.
Analysis Methodology:
The report begins with a historical overview of the automotive industry. This is followed by an analysis of the industry 's structural characteristics using Porter 's 5 Forces Model as a framework, which provides an understanding of the automotive industry as a whole in its current state. Next, ten representative companies of varying sizes are analyzed and compared; the chosen companies and selection criteria follow. General Motors, Ford, and Toyota were chosen because they are the current market leaders.
DaimlerChrysler, Nissan, Volkswagen, and Honda were chosen because of their status as stable international companies who have been in the automobile business for many years. Hyundai, Maruti
Udyog, and Shanghai Automotive Industry Corp., based in Korea, India, and China, respectively, were chosen based on their growth potential and their status as relatively new to the industry.
These ten companies are analyzed in terms of their market position, their financial situation, and their management strategy. Where useful, specific statistics have been incorporated into the
Submitted by Team A
Donald Bradley
Morgan Bruns
Adam Fleming
Jay Ling
Lauren Margolin
Felipe Roman
Presented to:
Prof. Alan Flury
December 5, 2005
ME 6753: Principles of Management for Engineers
Team A ii
Executive Summary
Chosen industry:
This analysis focuses on the automotive industry, specifically, large-scale manufacturers of automobiles.
The automotive industry is inherently interesting: it is massive, it is competitive, and it is expected to undergo major restructuring in the near future due to globalization and decreasing oil reserves. The analysis team members (we) feel qualified to perform this investigation due to our familiarity with the industry and our educationseveral of us have studied and worked on problems associated with automobile manufacturing and we are all mechanical engineering graduate students.
Analysis Methodology:
The report begins with a historical overview of the automotive industry. This is followed by an analysis of the industry 's structural characteristics using Porter 's 5 Forces Model as a framework, which provides an understanding of the automotive industry as a whole in its current state. Next, ten representative companies of varying sizes are analyzed and compared; the chosen companies and selection criteria follow. General Motors, Ford, and Toyota were chosen because they are the current market leaders.
DaimlerChrysler, Nissan, Volkswagen, and Honda were chosen because of their status as stable international companies who have been in the automobile business for many years. Hyundai, Maruti
Udyog, and Shanghai Automotive Industry Corp., based in Korea, India, and China, respectively, were chosen based on their growth potential and their status as relatively new to the industry.
These ten companies are analyzed in terms of their market position, their financial situation, and their management strategy. Where useful, specific statistics have been incorporated into the
References: November 9, 2005 6 7. Rear View Mirror - automotive industry history, Al Binder, Ward 's Auto World, March 1, 2003, http://www.findarticles.com/p/articles/mi_m3165/is_3_39/ai_99101938 10th, 2005, pp. 63-65. Hill. 2004 Daimler Chrysler January 5, 2005. http://www.detnews.com/2005/autosinsider/0501/06/A01-50668.htm 14 15. Daimler Chrysler, "Updated Management Report." Interim Report Q32005. October 25, 2005. 17. 2004 Annual Report. Ford Motor Company. Available from http://www.ford.com/en/company/investorInformation/companyReports/annualReports/2004annualR October 25, 2005 19 http://finance.yahoo.com/q/bc?s=F&t=5y&l=off&z=l&q=l&c=%5EGSPC accessed October 21, 2005 GM 20. Letter to Stockholders (2004). 41. "Toyota, Nissan Add U.S. Market Share as Ford 's Drops," Bloomberg.com. August 3, 2004. Fortune. 4 October, 2004. Vol. 150 Issue 7, p102-110. http://www.busrep.co.za/index.php?fArticleId=2950138. October 17, 2005 56 57. "Major changes in auto industry since China 's WTO entry." April 6, 2004.