AUTOMOBILE INDUSTRY

Impact of Global Economic Crisis on the Automobile Industry

Impact of Global Economic Crisis on the Automobile Industry

Introduction

The global economic crisis started in 2007. This was the biggest and the most harmful recession after the Great Depression. The world had suffered a lot. Businesses all over the world were facing huge losses and people were losing their investment. The stock markets all over the world faced great recession and the people who had invested in the stock markets were not at all getting any returns on their investment, instead their investment shrunk and they lost a major part of their investment. This made them think about reinvesting their money, but they could not because the amount of their investment had reduced significantly and they were left with very less money which they could not invest (Wells, 2003, pp. 15).

The global economic crisis was one of the most harmful events for the economy of every country. The financial crisis caused the businesses to slow down and the industries faced huge losses. The import and export between countries became very slow and difficult, and people were unable to recover from the loss that they had suffered.

The crisis of 2008 has tarnished faith in the world financial system and in free enterprise. What is the capacity of democratic capitalism to reform itself? We will find out over the next few years. Mere pragmatism obliges us to ponder the odds that capitalism will commit suicide; that the events of 2007-2010 are only its next-to-last crisis. Economic policy is partly about politics, a game of give-and-take, locally, nationally, and internationally. A war of words, deadlock and impasse are common in complex negotiations. To be sure, money matters. Yet, justice is the bond that keeps society together and that makes the continued existence of global capitalism feasible. At this point, a great deal of effective action as well as symbolism is needed to restore the moral dimension of capitalism (Mitchell, 2010, pp. 25).

This paper will analyse the impact of economic crisis on the automobile industry of United Kingdom, and what steps should the company take in bringing out the best in it.

Automobile Industry

During the financial crisis, the UK produced 1,649,515 vehicles which ranked the company 12th in the world. In Europe the country is ranked 4th since 2000. The country's automobile industry, like others, was impacted by the economic global crisis. The country's trades reduced which caused people to withdraw their investment and invest in other opportunities. The same was the case with the rest of the world. The automobile industry throughout the world was adversely impacted by the global economic crisis.

Characteristics of Automobile Industry

Every industry has certain characteristics which differentiates it from the other industries. Such characteristics help the industry in making sure that they gain from the situation and earn from the economy. The following characteristics are of the automobile industry (Hill, 2000, pp. 45).

Employment

The automobile industry employs around 1/4th of the labour of the whole ...