Japanese Automotive Industry

Japanese Automotive Industry

Introduction

The 3 biggest automakers of the world are known to be Ford Motor Company with a market share of 10%, Toyota Motor Company with a market share of around 11% and General Motors occupying a market share of 13 %. The productivity of these companies matched their percentages of the market share. It is important to note that the centre of automotive production is known to be the region of Asia-Pacific. The statistics of 2004 highlighted that this region contributed to the production of over twenty three million units. Japan was witnessed to dominate the production, whereas China attained a distant second position, with its production being half compared to Japanese production. Furthermore, the regions of North America and Western Europe were ranked 2nd and 3rd in the competition with the production of seventeen and sixteen million vehicles. Considering the Western Europe, Germany was known to be dominating the competition, where in Northern America, the US managed to produced the lion's share (Freyssenet, 2000).

Considering the consumption of these vehicles, the northern Americans have been known to consume the most, whereas the Western Europeans as well as the Asian Pacific attained the next two positions. In China, the per-capita ownership of automobiles is substantially small (1.5 automobiles per 100 households in comparison to Japanese statistics of 50 vehicles per 100 households). In 2004, the sales of Japan outmatched the Chinese sales with over a 100,000 vehicles. However, it is important to note that the growth rate within Japan was known to be a meager 0.1% as compared to the statistics of China, which experienced a growth rate of around 17.2% in that same period of time.

There were various other countries which experienced a growth of double figures, but with the sales of just over a million automobiles. These included Spain, with a growth of 10.2 percent, Mexico experiencing 11.8 percent, Brazil 17%, India 18.2% and Russia experiencing a growth of 24%. The macroeconomic policies and performances highlight the opportunities within these markets. Hence, producers of automobiles follow a portfolio approach to marketing as well as production, given the regions' vulnerability of economic growth.

The analysts of automobiles, since 1960 have observed a few sources of new productive capacity. These were known to be China, India, Eastern Europe as well as Latin America. However, by 1980s the automobile industry of Eastern Europe witnessed a severe decline. The major reason behind this was the severe political and economic turmoil causing a halt to the vehicle sectors of Latin America. The 1990s witnessed the trade liberalization as well as the development of the policies relating to investment within China and even India. In the present times, China has managed to gain the attention as becoming the new location for the production of automobiles. The first company to opt for China was Volkswagen in 1985. Since then, the majority of the automobile producers have managed to establish operations within China. This was mainly done through entering in to joint ventures with the local ...