ECONOMIC PROFILE OF THE GERMAN AUTOMOTIVE INDUSTRY

Economic profile of the German Automotive Industry

Economic Profile

Germany's economic strength was based on production cars to a large extent. The automotive industry is one of the dominant sectors, since many economic activities are based on and related to automotive products (Kwon 2004). If you enable the suppliers, service stations, garages or retail, for a total of about 5 million people (1 out of every seven jobs in Germany) depend on the success of the automotive industry.

Market structure

Today, parts of more complex and technologically advanced in order to cope with the diversified demand and need for flexibility by car manufacturers. Some vendors are large and produce different products for other industries as well. Most suppliers are however, small and medium-sized firms. There are two types of suppliers (Becker 2006). The first type of firms produces systems, modules and components in close cooperation and coordination with final producers. Final producers, because of specialization in core competencies, strengthen their competitiveness. They shift tasks, such as research and development and storage to the suppliers. The second type of suppliers produces large volumes of standardized parts low cost. These firms are vulnerable to international price competition. They strongly depend on the policies and decisions Car producers. With changing technology, production concepts, strategies and products, the automotive industry is often the initiator of innovations in other industries. Its success was due to technological competencies of manufacturers, suppliers and their employees.

In 2007, the number of people employed in the automotive industry (including manufacturers of trailers, parts, spare parts and organs) were 792,000 and 57,500 in West and East Germany, respectively. In terms of number of employees and firms in land (Map 4.1!), Baden-Wuerttemberg, Bavaria, Lower Saxony, North Rhine-Westphalia and Hesse were major centers of automobile production. With the automation and streamlining in 1970, firms try to avoid a crisis (Osswald 2007). Even a new concept of production, such as Just-In-Time (JIT), which is the supply of parts for assembly plants in the exact time they are needed, and the use of advanced technologies, have been insufficient to cope with the structural and market changes. Since mid-1990, the automotive industry was back on the path to success. This is partly due to increased exports and higher diversification, but also a sharp job cuts and other restructuring measures which have helped increase sales and profits.

Policy

Production concepts, processes and ...