StudentShare solutions
Triangle menu

How EU policy affects the European Automotive Industry - Essay Example

Nobody downloaded yet

Extract of sample
How EU policy affects the European Automotive Industry

However, during the last five years, there has been a slowdown in economic output across the EU, and, while the forecasts are positive, modest growth of 2.0%-2.3% is expected in 2004. Weak growth has led to reduced consumer and business confidence. Industrial production has decreased, including the production of durable consumer goods. Levels of private consumption have fluctuated during early 2003, following modest growth in the previous two years. This is partly due to poor labor market conditions, with EU unemployment rising during 2003. Economic indicators are weak in some major EU economies such as Germany, France, Italy and Spain. Only the United Kingdom (UK) has managed to resist these trends (Trends and drivers). This has greatly affected the car industry, given the car's status as the ultimate consumer and fashion item, as well as the importance of engineering and design in the manufacturing process. Average profit margins have declined from around 10% in the 1960s to less than 5% today, and some volume car makers are actually losing money (EMCC dossier).
Despite increasing competition worldwide, European automotive has maintained a strong position in exports and global sales. The strong bond between Europe's vehicle manufacturers and the sophisticated customer base in the largest car market in the world constitutes a prominent competitive advantage, while the notable presence of European producers in emerging markets, such as China and the Russian Federation, offers a potential for future growth and profits (info-crono-archivio). Furthermore, EU enlargement created new opportunities for the European automotive industry. The combination of expertise, affordable labor and the proximity to the large European markets has led to the emergence of a very dynamic cluster in the new Member States - especially Poland, the Czech Republic, the Slovak Republic and Hungary (info-crono-archivio).
Despite these advantages, many challenges remain: the EU automotive industry lags behind the US and Japan in terms of productivity. Labor productivity in the EU-15 is 25 per cent lower than in the US and 30 per cent lower than in Japan; labor costs per hour worked in the EU-15 are comparable to those in the US, but more than ten per cent above those in Japan and almost three times as high as in Korea (data for 2001, converted using purchasing power parities). Annual working time in the automotive industry in EU-15 is more than 20 per cent shorter than in the US (in 2001); there are major technological challenges ahead, most prominently the fuel cell (info-crono-archivio).
Influences of EU policies
European legislation is one of the main drivers of the European automotive industry. Emissions and recycling legislation have a strong impact both on vehicle technologies and construction (Trends and drivers). EC, industry and consumer concerns for environmental sustainability, road safety and mobility have led to a number of significant technological developments. These have both positive and negative effects on profitability. For example, a limited number of specialist high technology suppliers might prosper while vehicle makers see their already narrow profit margins cut even further. Such a development would make vehicle makers vulnerable to further consolidation and restrict ...Show more


The automotive industry is one of the biggest of all industries. It manufactured nearly 60 million cars and trucks a year and employs several million people around the world. It is a key indicator of economic growth and a main contributor to the gross domestic product (GDP) of several Member States and the EU (EMCC dossier)…
Author : okunevamaddison
How EU policy affects the European Automotive Industry essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"How EU policy affects the European Automotive Industry"
with a personal 20% discount.
Grab the best paper

Check these samples - they also fit your topic

EU Aviation Policy
In addition, the policy is success for availing more choice in the sense that there has been an increase (approximately 220% from 1992-2009) in the number of cross-border intra-EU routes. This in turn, has led to lower fares emanating from emergence of market for low-cost air services.
3 pages (750 words) Essay
The automotive industry in For almost the past hundred years the automotive industry has dominated Michigan's economy. How and
However, the place was not only home to auto manufacturers, it was also home to dealers and suppliers of auto parts. There are many reasons behind this. For instance, even before motor vehicle were invested or brought to America, Detroit was an industrial city boasting of a diverse, extensively regional manufacturing hub.
5 pages (1250 words) Essay
Global Marketing - Automotive Industry
.................................................................................................................. 2.1 Industry analysis................................................................................................ 2.2 Competitor analysis.
16 pages (4000 words) Essay
Automotive Industry Marketing
The industry is involved in the design, development, manufacture, marketing and sale of motor vehicles. The industry is involved in the production and sales of more that 70milino cars in the world. There are major places in the industry with Japan leading as the world's largest car producer of its brand Toyota.
5 pages (1250 words) Essay
Car Industry in Europe
It reviews the different Euro standards of emissions and continuous progress in the direction as well as the present emission norms, which has to adhere by the car industry in Europe. It also reviews all the protocols and steps to achieve the emission standards by EU and how it affects the present status of car industry and its requirements.
20 pages (5000 words) Essay
Global Automotive Industry
The automobile industry for example has really expanded their computer and electronic components of their vehicles. These developments have led to improved fuel economy and better and improved chassis systems. Even as the automobile industry continues to grow, it is evident that the market is becoming more competitive by the day, and this has forced many manufacturers to reduce their costs of production, look for new markets, reduce the time for the production for development of a new product, also there has been the need to form mergers and alliances with other business partners and create more newer and innovative design and content.
14 pages (3500 words) Essay
Analysis of the Pricing policy in Automotive Industry over the Years 2001-2005
It is shown that, by the year of 2005, automobile industry had suffered slumps due to rising prices, taxes, competition and most of all, the skyrocketing oil price hikes. The price of the new cars therefore went down. With the globalizing car industry, the prices of automobiles were an important issue in determining the condition of the industry.
7 pages (1750 words) Essay
The European & Global Automotive Industry
In 2002, 17.4 millions were manufactured in Europe alone out of the global total of 59 million units (EMCC, 2004). It is the second most competitive region in automotive industry after the
8 pages (2000 words) Essay
How the economy has affected the automotive industry
mic dip will force the public to cut down their expenses and they will first reduce their spending on purchasing luxury things like automobile vehicles. This paper analyses the effect of economic shifts, price elasticity, monetary and fiscal policies on automotive
7 pages (1750 words) Essay
The United State Automotive Industry
As the report declares the auto industry comprised of local companies alone. However, since Honda established it plant in the U.S. other major automotive industries from Europe, and Asia have opened their plant or established partnership with the existing plant to produce their brand of vehicles.
2 pages (500 words) Essay
Hire a pro to write
a paper under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
Comments (0)
Click to create a comment
Contact Us