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Business in context 2 - Essay Example

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The global economy was drastically affected due to the recent credit crisis which engulfed the whole world into its gamut of realty losses creating vacuum in the market by forcing the, once upon a time leaders of the industry, banks like Lehmann Brothers, Merrill Lynch, AIG, RBS…
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Business in context 2
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Business in context 2

Download file to see previous pages... most 90,000 workers in the year 2007 and according to Challenger Gray and Christmas, plant closures by Ford and General Motors will ripple through the economy possibly resulting in more job cuts in the coming year. (www.allbusiness.com) The world economic crisis has hit the car industry with real intensity forcing the major car companies to adopt strategies of short time working, redundancies or closures. (www.fifthinternational.org)
The automotive sector is one of the largest and most multinational of all industries which is the key indicator for economic growth in regard to GDP of many countries. The car industry is important in view of its employee strength, its contribution to countries development, assets and total sales which can be known from the fact that in the year 1999, four of the top ten companies in the world included General Motors, Ford, Toyota, and Chrysler.(www.eurofound.europa.eu) The Koontz, H and Weihrich, H. (2006) stated that car industry may be indicative of how many industries become globalized making it difficult to predict the future. It is further stated that countries such as China and India will be the drivers not only of economic growth in general and car industry in particular. The Economic Intelligence Unit had predicted that 40% of the car sales will be in Asia by 2020.
Jian Suan (2006) stated that in early 2000s China was a dream market for many multinational auto companies with only 24 cars per 1000 residents as compared to 700 cars per 1000 residents in United States and worldwide average of 120 cars, the China market was widely regarded as the largest growth opportunity. China reported an increase of 6% in global auto market from 4% in the year 2001 to 10% in ranked equally with Japan which reported a decrease of 1%. Carlos Gomes (2010) reported that global car sales continued to gain momentum with more than double of sales taking place in China, the world’s largest auto market. The auto sales in United States too reported ...Download file to see next pagesRead More
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