The development of the automotive assembly line by Henry Ford in 1908 increased the success of the American car industry exponentially, helping it become one of the most prominent industries in the world. The increased manufacturing efficiency and affordability of the Ford Model-T made the American industry the first industry to mass produce affordable automobiles. Another technological development that benefitted the American car industry was the interchangeability of car parts pioneered by Henry Leland. This added to the practicality of owning a car because now if a part was broken in any way, it could be replaced with an identical piece. The development of the battery-operated ignition by Charles Kettering in 1910 was another benefactor to the success of the American car industry in the early 20th century. The battery-operated ignition system provided a more user friendly substitute to earlier ignition systems. Although there were many technological developments that helped the American automotive industry keep its position as the most successful in the world for decades, when the Japanese car industry was formed in the 1950s they introduced more innovative, efficient, and consumer friendly vehicles that were especially appealing to consumers during and after the fuel crisis in the 1970s. Not only did these Japanese manufacturers consistently introduce more appealing cars than the American companies, but they also kept their pride in their products and their passion for the automotive industry as a whole.
Car loan is one of the consumer’s credits that are applied for personal use of a vehicle. This is usually unsecured and it is based on the borrower’s ability to pay. Most consumers need financing or leasing to acquire a vehicle. This paper explores how the defaulted consumer car loan affects the Philippines Automotive Industry. Base on Esquire Financing Incorporation, they seek the five C’s of ...
Although the first car built in Japan was assembled in 1902, most of the Japanese car manufacturers began producing cars in the ’50s and ’60s; the exceptions being the two largest manufacturers, Toyota and Nissan. Toyota began experimenting with cars in 1935. Their first models were essentially copies of American and European models, as were most of the other Japanese cars that emerged from this era of manufacturing. Nissan started manufacturing cars in the ‘40s which were as unsuccessful as Toyotas first models. Toyota and Nissan began exporting cars to the United States in 1958. Both car manufacturers sold a minimal amount of cars and did not make much of a dent in the U.S. market. The manufacturers decided that the cars were not right for the U.S. market and pulled back both to study the situation and because they were losing money by exporting all of these vehicles.
Toyota and Nissan studied American marketing techniques, improved service networks, and designed cars that were more appealing to US buyers without copying existing American models (essentially “Americanizing” their vehicles).
These improvements helped Toyota and Nissan move up in the sales charts in the late ’60s. This “Americanization” is still evident today. The former simple, reliable, and affordable Japanese Toyota Camry has become a pseudo-luxurious, bulky, Americanized Camry with a plastic finished interior that drives like a cloud. The first foreign car company to assemble cars in the United States was Volkswagen, a German maker with a high reputation for quality, and it reported the same results between the quality of German plants and the American plants. Honda, who started exporting cars to the states in 1970, was the first Japanese car manufacturer to have their cars assembled in the US in 1982. Its plant in Marysville, Ohio, has been so successful that it now manufactures nearly all the cars Honda sells in America and even exports cars to other countries, including Japan. In 1984, Toyota merged with General Motors to manufacture cars like the Toyota Corolla and pickup trucks like the Toyota Tacoma on American soil. Since then, Toyota, Mazda, Nissan, Mitsubishi, and Subaru, have developed American plants in which to manufacture their cars. In addition, German companies Mercedes-Benz and BMW are preparing to build their own American facilities as well.
Wal-Mart is the largest American retailing company. There are close to 3.000 Wal-Mart discount stores in U.S. alone. Nowadays, many people think of a Wal-Mart as the symbol of American consumerism, however, not many of them do realize that the word American is the least applicable, when it comes to describing the essence of Wal-Mart as commercial enterprise. This retailing company is nothing but ...
In 1995, foreign car makers sold more U.S.-made automobiles in the United States than they sold in the country that they originated from. Meaning that Japanese car companies were having more success and making a larger dent in the American car industry than in the Japanese car industry. Car imports into the United States in 1995 decreased to 1.7 million, dropping lower than the number of foreign cars already being assembled in America (1.9 million).
The amount of American built foreign cars sold in 1996 totaled 2.4 million and 200,000 of these U.S.-made cars were exported. The percentage of American cars sold in Japan has dropped from over 25 percent in the early ‘90s to about 13 percent by 1996, the smallest market share between these two companies in 20 years. In 1996, these foreign-owned American plants employed about 40,000 Americans and built more cars than Ford Motor Company or Chrysler Corporation.
Manufacturing and selling cars in foreign countries has had an enormous effect on American car companies since the automobile industry began in the US. Ford, founded in 1903, sold the sixth car it built to a Canadian buyer, and in 1904, Ford of Canada was founded in Windsor. Ford began building cars in England in 1911, Brazil in 1919 and in Germany and Australia in 1925. Ford now assembles cars in Argentina, Ireland, Malaysia, Mexico, New Zealand, the Philippines, Spain, South Africa, Taiwan, Uruguay and Venezuela. It recently acquired the venerable Jaguar in Great Britain. General Motors, founded in 1908, made the transition into the international market a little later than Ford. It began building cars in Canada in 1918, then took over the British auto company Vauxhall in 1925. In 1929, GM bought the German car company Adam Opel, one of Germany’s oldest auto makers, then bought Holden’s in Australia in 1931. In the ‘90s, GM considered buying Rolls-Royce, but opted for the Swedish car company Saab instead. GM also assembles cars in Europe, Asia and Africa. In the ‘90s GM and Toyota came to an agreement in which, GM assembles Japanese cars in the United States and advertises them with the General Motors name.
American Companies & Globalization American companies working with International companies are rumored to believe it is hurting the U.S. economy by outsourcing jobs to other countries because of cheaper labor. Contrary to widely held public opinion, the expansion of offshore manufacturing and other activities by U.S. based multinational businesses benefits the domestic economy, and has not ...
The delineation between what was an American car and what was not was becoming unclear. Several cars assembled in the United States have always contained major components, such as engines or transmissions, made in foreign countries. Some cars built in other countries are marketed with American nameplates. And several cars with foreign nameplates are assembled in the United States. This brings up the question: Is a car assembled in England by an American company American or English? Is a car built by a Japanese company in the United States Japanese or American? National borders began to lose significance. Auto corporations were becoming citizens of the world, not of the nations in which they were created. GM and Ford were American auto makers by definition, but they built many of their cars in foreign countries. Making them British, German, Spanish, Korean, Mexican, etc. as well as American.
Why did Japan surpass and essentially beat the United States at its own automotive game? Several explanations have been offered. One of which is the high labor costs in the United States. This is what the management divisions of the US car companies blame. The labor forces of the large US auto companies blame poor and corrupt management. The workers gained credibility when Japanese car companies started building cars in the United States and were able to hire a large amount of skillful American workers. Many people blame American management’s attention on short-term financial performance whereas Japanese makers focused on their long-term financial situation while maintaining flawless quality and technological excellence.
“’Made in Japan’ used to mean ‘cheap imitation’ and second-rate quality to most Americans until the ’50s — the Korean war, to be specific, where photographers first noticed that Japanese lenses were as good or better than German and about half the price. Now “made in Japan” means high tech and high quality. About one in four cars sold in the United States are made in Japan or assembled in the United States plants owned by Japanese firms.”(Richard A. Wright author of: A Brief History of the First 100 Years of the Automobile Industry in the United States)
Financial Ratios: What They Mean In assessing the significance of various financial data, managers often engage in ratio analysis, the process of determining and evaluating financial ratios. A financial ratio is a relationship that indicates something about a company's activities, such as the ratio between the company's current assets and current liabilities or between its accounts receivable and ...
American managers are thought of as looking for the quick buck and are more interested in their salaries and benefits than in corporate growth and successful investments. Craftsmen who put their names on their products and took personal interest in them created the American auto industry. They obviously wanted to make money, but this idea was far inferior to their lust of automotive glory. “A business that makes nothing but money is a poor business.” Henry Ford. Now craftsmen are not as much interested in the quality of their creations but are more focused on the next quarter’s results. They are out of style, company loyalty is not on their mind, and they take their creations for granted. The evidence is that the management divisions of these companies had a lot more to do with America’s decline than the labor divisions.
Japanese companies, however, took pride in their products and demanded perfection. They maintained this mentality even when their businesses grew into massive corporations and that is why they have become the most prominent car makers in the world. They understand the direct relationship between the product that their company produces and the profits that their company makes. Toyota has a philosophy that they call “The Toyota Way” which was adopted in 2001 as an expression of values and principles that is embodied by the entirety of the Toyota work force. With the two main headings being, “Respect for People” and “Continuous Improvement” the “Toyota Way” also consists of four main components. These include;
I. Long-term thinking as a basis for management decisions.
II. A process for problem-solving.
III. Adding value to the organization by developing its people.
IV. Recognizing that continuously solving root problems drives organizational learning.
This philosophy that Toyota developed not only ensures their management and work force that this massive driving force in the world automotive industry is not only about making money, it makes this known to the world. This instills a sense of certainty that Toyotas vehicles are manufactured with pride and completed with the utmost precision into their buyers. As far as I could find, none of the big three auto manufacturers in America had any sort of philosophy or set of values.
American Industry in undoubtedly one of the strongest in the world. Numerous nations are recipients of many of our plethora of exports. From cars, to books, to corn, and everything in between. But where did this amazing system come from? Was it some aspiring urban businessman? Or maybe a tired housewife. It could have even been a son of a farmer. The system itself did not come from one person, but ...
The 1970’s marked the beginning of the fall of the American Auto Industry. This decade included American economic problems including, high inflation, high interest rates, price control, and both the energy crisis of 1973-74 and the energy crisis of 1979. All of these economic situations had an immense effect on the American auto industry. To add to these preexisting situations, the decade began with a devastating strike by the United Auto Workers (UAW) in 1970. This strike resulted in the production of the big three American Auto companies decreasing by 1 million vehicles, 10% lower than the previous year. While the American industry was suffering a great loss in sales, the foreign auto companies sold one hundred thousand more cars in America in 1970 than they had in 1969. A vast majority of these 100,000 vehicles were small, inexpensive, simple cars such as the Toyota Corolla. In 1972 when the UAW strike ended, GM produced 8.5 million vehicles that same year, the third highest in industry history. Although this high production rate improved company confidence and morale, the profits were being constrained by the government due to President Nixon’s new wage and price controls and the regulations concerning standard safety features in all vehicles. Again while the American industry was suffering from governmental regulations and economic difficulties, the Japanese industry kept improving. These American governmental regulations did not pertain to foreign car companies. The Japanese were already selling generally cheaper cars than American companies thus the price control did not affect their sales as much.
A less direct cause of the oil embargo of 1973 was America’s fuel consumption habits. When the American Highway system was developed in the 1950s, the automotive industry in America changed. Public transportation was used less frequently because most people could afford their own car. This affected the gas consumption, as a country many people purchased large, luxurious, comfortable cars for driving long distances on interstate highways. Although these cars had atrocious fuel economy, fuel in America was cheap compared to Europe and Japan. On the other hand, European and Japanese cars were generally designed to have better fuel economy because the fuel prices were much higher in these areas. The first gas crisis in the States took place in 1973 when the Arab countries who supplied America with oil, proclaimed an oil embargo with the US because of a conflict with Israel. Needless to say, this crisis raised the price of fuel in the States enormously. The American people needed more fuel efficient vehicles. So what did many people do? They sacrificed comfort and luxury and turned to foreign cars. After the price of gas decreased people went back to their large comfortable gas guzzlers until the most recent gas crisis the 2000’s. Again many Americans chose to buy Japanese fuel efficient vehicles which were not only more fuel efficient but provided the same luxury and comfort that they were used to in their large American cars.
Starbucks, an American global coffee company and coffeehouse chain that’s been distributing all around the world has been continuing to grow to the point where you basically see a Starbucks in every corner. Starbucks advertises the idea of chic and professionalism to the upper and middle classes through the earthy, smooth décors, relaxed environment, and its modish, trendy music. When we walk into ...
“The 1970s changed everything for the auto industry in the United States. No longer was it the envy of the world; the Japanese now held that title. The car itself became less of a status symbol than a mode of transportation. Consumers were looking for cheaper more fuel efficient cars. After the 1970s the Detroit car-makers were faced with a decade of rebuilding lines of cars, restoring their reputation for quality, and recovering a domestic market. That they had survived such a tumultuous decade was a stunning, if not satisfactory, achievement.” (George S. May, editor of The Automobile Industry, 1920-1980)
Today, Toyota has not only maintained its prominence as a car company in the world automotive industry, it has made strides to improve auto manufacturing as a whole and has developed new innovations to keep up and even stay ahead of the ever changing modern era. Cars such as the Toyota Prius, which was the first mass produced hybrid vehicle, is now the bestselling hybrid car in the world, and is the most fuel efficient gasoline car sold in America, have been paving the way for auto manufacturing all over the world. The Prius provided people with a contemporary, stylish, and innovative vehicle to manage the endless increase in fuel prices in the US and all over the world, and to give its owner a good sense of environmental awareness. Fortunately, Toyota has influenced American auto companies who are now starting to follow suit. American companies started manufacturing hybrids and as long as innovative companies like Toyota stay a step ahead of the game and American companies stay modest enough to follow, the automotive industry in America and all over the world, should continue improving for years to come. The American automotive industry started off strong. With innovations such as the automotive assembly line, the interchangeability of vehicle parts, and the battery operated ignition they had the potential to lead the industry for decades. But they did not. They fell by the wayside when modern foreign companies not only stayed true to their values, but also excelled in developing innovative creations that were both appealing to consumers and paved the way into new exciting eons of automotive excellence. These corporations have not shown any signs of deteriorating, and look as though they plan to stay at the top of the industry for the foreseeable future.