Automobile Industry: Opportunities, Markets, and Globalization

In this video, you will learn how automobile companies are making the transition to producing a lot more fuel-efficient vehicles. CEO, Jack W. Plunkett, guides you through the trends that are going to take over one of the world’s most influential industries.

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The problem is that within the United States, the industry is forced to make

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more investment than it wants to in small highly fuel-efficient cars because

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as the years go by, the C-A-F-E, or the required average fuel efficiency rate for each

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manufacturer gets higher and higher. Pretty soon, automakers are gonna have

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to post more than 50 miles per gallon average per automobile. Now that’s gonna be

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hard to do. It’s going to take a lot of engineering. It also takes away from their investments in big

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gas-guzzling vehicles. In Europe, automakers are pretty well focused on

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selling more fuel-efficient vehicles because fuel prices in Europe are always

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so high, where fuel is taxed at a much higher rate per gallon or per liter than it is

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in the United States. Finally, in many places in Asia, automakers are working

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under the problem that big luxury cars that might be imported, pay huge import tariffs.

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While their local manufacturing is more focused for instance in China on smaller

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lighter cars and vans. Today,

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car-makers are more than ever focused on efficiency, which to them means optimum

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lean production, which means relying more and more on their outsourced makers of

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parts, components, and assemblies, which the automaker’s then bring into their

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own factories and assemble as much as manufacture. They want to rely on

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Mexico is absolutely hot in this regard. What’s the long-term future of the

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automobile industry? At one time, analysts were thinking of as many as

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three billion cars and light trucks on the planet by 2050. Roughly three times

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today’s rate. However, the sharing economy may well put a hold on that thought as consumers

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around the world more and more are using everything from bike sharing to car sharing

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services like Zipcar; eliminating to some extent the need for personally owned

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automobiles. Other things for the future that must be considered, are natural

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gas-powered vehicles with the world awash in natural gas, particularly in

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North America. There will be more reliance on using natural gas for big

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transportation, at least things like buses and long range trucks. What about

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electric cars? All-electric things like Tesla and hybrid cars like the Prius

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still represent a very, very small portion of the total automobile market.

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