AUTO MOTORS IN ASIA PACIFIC

Motives and strategic operations for US and European Car Manufacturing in Asia Pacific and Emerging Countries

Motives and Strategic operations of General Motors in Asia Pacific and Emerging Countries

Introduction

The performance of General Motors in the New Car Dealers industry in the developed countries like US is largely reflective of the automotive sector as a whole not only in European and US market but also in the Asia Pacific and emerging markets. The financial crisis has taken a toll on dealers, and a significant proportion of companies had trouble finding funds to stock their showrooms in 2010. Stocking woes and falling consumer demand have negatively affected demand for automobile manufacturing in the past year (Biswajit, Saikat & Rittwik, 2007, p.17). The demand from Gnereal Motors is expected to increase during 2013 - 14 throughout the world and this is the target which is significantly pointed out by the European and US leading automotive markets.

The price of gas also represents a significant part of the running costs of a vehicle. The retail price of gasoline has grown rapidly; combined with declining disposable income, it has led consumers to think twice about their fuel consumption. This is one reason that the major target for US and other European countries is to hit the market where these prices are significantly low which not only reduce their production costs but also they could face an increasing demand. Consequently, consumers have demanded smaller and more fuel-efficient vehicles particularly in the Asia Pacific region, even though domestic automakers have historically focused on larger, less fuel-efficient cars (Humphrey, Lecler & Salerno, 2000, pp.9-11). The world price of crude oil is expected to decrease during 2013, but is still at a historically high level, posing a potential threat to the industry.Steel is a key input in the production of automobiles and represents a significant cost to automakers. High steel prices lead to cost pressures that cannot always be passed on to consumers. Automakers' production costs could exceed sales revenue in some instances. The world price of steel is expected to increase during 2013.

The yield on the 10-year Treasury note is a proxy for and analogous to the interest rate set by the central bank. As the interest rate decreases, demand for cars increases because it costs consumers less to finance vehicle purchases. The yield on the 10-year Treasury note is expected to increase during 2013.Exchange rates play an important role in the industry's ability to remain competitive (António, 2001, p.36). Traditionally, the market consists of Korean automakers at the low end, Japanese automakers in the middle and European automakers at the high end. A depreciation of the US dollar typically leads to a rise in exports, which has a positive effect on industry revenue. The trade-weighted index is expected to increase during 2013 (Mukherjee & Sastry, 2006, p.21).

Comparison of Motoves and Startegic Operative of General Motors in India and United States

Startegis of GM in US

The global industry of automobile has been going through excess ...