Automotive industry is recognized as one of the most global of all industries. "On a global level, the assets of the top ten multinational automotive enterprises represent 28% of the assets of the world's top 50 companies, 29% of their employment and 30% of their total sales.
In 1999, four of the world's ten largest companies were in the automotive sector: General Motors (no 4), Ford (no 5), Toyota (no 6) and Daimler Chrysler (no 7). Several other European based companies can be found within the top 100 companies: Volkswagen (no 12), BMW (no 20), Renault (no 28), Peugeot (no 49), Fiat (no 51) and Volvo (no 88) (European Foundation for the Improvement of Living and Working Conditions, Sector futures, and the automotive sector at a crossroads).
In the middle of the 20th century, there were more than a hundred automotive producers. In the decades since, continuing consolidation of both producers and major suppliers due to overcapacity has led to the creation of major groups. Over the last 20 years, multinational groups have emerged such as Daimler-Benz, Chrysler and Mitsubishi; Ford, Volvo, Mazda
and Rover; Nissan and Renault; and General Motors, Fiat and Saab.
"In 1995, 1.2 million people were employed in manufacturing and assembling vehicles and over half a million in making parts. If the jobs in related industries are included, over 12 million EU citizens are employed in the automotive industry" (European Foundation for the Improvement of Living and Working Conditions, Sector futures, and the automotive sector at a crossroads). But, since the 1970s and 1980s, the native European automotive industry, and particularly, that of the United Kingdom, is declining, because of foreign direct investment by companies such as Toyota, Nissan, and General Motors. In 2005, production of cars was 66.5 million, 2 million more than in 2004. The market is dominated by a few numbers of companies that are known all around the world. General Motors is the first car manufacturer in terms of production (more than 9 million vehicles in 2005) before Toyota (more than 7.3 million) and Ford (almost 6.5 million). In the EU, Volkswagen, Ford (Volvo), PSA Peugeot Citroen, General Motors and Renault are the biggest players in the manufacture of passenger cars.
[...] These barriers can affect Toyota by delaying imports at the frontier, a purchase bias in favor of the government and contracts that specify standards with which domestic producers are familiar but foreign producers are not. Another barrier to trade includes voluntary export restraints. This is a limit that has been imposed on the level of exports by a country. So, a limit has been imposed on the amount of goods or automobiles that can be imported in a financial year. [...]
[...] (Hill, Charles W.L -5th International business: competing in the global marketplace P195) Since then, non-tariff barriers have been key instruments of trade protectionism. In1970, Japanese automobiles entered the U.S. and European markets. The governments of United States and Europe issued relevant policies in order to protect domestic automobile companies. “Voluntary export restraints” and local content requirement” emerged as the main means of restricting auto exports from Japan. Voluntary export restraint is a quota imposed by the exporting country. The U.S. [...]
[...] Foreign direct investments have become an important feature of the company's success and ability to find loopholes in trade barriers. Toyota's decision to become a multinational company was partly due to the effects of globalization. Toyota began to view many different countries as potential markets. This radical view opposed foreign direct investment, arguments arose that the loss of profits to the host country was too much of a disadvantage. This view began to collapse with communism. A more liberal view became apparent, where there were both advantages and disadvantages of foreign direct investment to both the host and foreign countries. [...]
[...] General Motors was the leading car manufacturer in terms of production (more than 9 million of vehicles in 2005) followed by Toyota (more than 7.3 million) and Ford (almost 6.5 million). In the EU, Volkswagen, Ford (Volvo), PSA Peugeot Citroen, General Motors and Renault are the biggest players in the manufacture of passenger cars / 12 Production across the world can be divided into: - Asia-Oceania: More than 25.8 million units than in 2004) Europe: more than 20.8 million units 0.2 Americana: more than 19.3 million units Africa: 522,000 units, i.e of total world production in 2004) As shown by the statistics, Asia-Oceania car production has increased rapidly and represents the most important geographical zone of automotive production. [...]
[...] In response to the political pressure of the United States and Europe, the Japanese government was forced to agree to the barriers imposed by the United States, out of fear of more damaging punitive tariff and quota on imports by the United States, which could result in a loss of market share in the country. Finally, Toyota emerged as the biggest automobile company in Japan; however, it was still plagued by the restrictive trade barriers. If Toyotas are unable to avoid these trade barriers, it could result in a low market share and reduced sales volumes and margins, and may adversely affect Toyota's financial conditions and operation results. [...]
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