BMW

Companies // Automobile

• Background

  This company is a constituent of the automobile sector. Highly sophisticated scientific programmes and groundbreaking designs have turned the automobile industry into a technological trendsetter for other sectors such as aerospace and defence. Be it the latest tyres, clutches, or engines, innovations can be ported into areas where vehicles have to withstand much more pressure than on the road. A catalyst for new technologies is motor sports, where cars are tested under extreme conditions and by highly skilled engineers and drivers. The automobile sector is a major contributor to the global economy. Many countries manufacture, export and import vehicles and parts. Millions of people work in the industry worldwide, from manufacturing plants to insurance sales. Through sponsorship programmes and research projects, the automobile sector is also a major contributor to education and science. Passion for fast cars and comfort as well as the need for practical vehicles have created a broad range of products for the consumer to choose from. This sector is about so much more than just cars. It covers vans, trucks, buses and motorcycles, plus appliances, maintenance and marketing. The top global manufacturers have production and distribution facilities across the globe. Some have branched out into other areas such as chemicals, electrical equipment or financial services and become conglomerates. Internationalisation has led to a highly competitive environment in which the global brands fight for market share or – increasingly - survival. Besides safety concerns, the green movement has created new challenges. While the goal of fuel efficiency and quieter engines is an old one, the amount by which emissions are expected to be reduced is a tough task. The industry is under constant pressure to come up with ever new solutions requiring more lavish R&D budgets. The automotive sector depends heavily on the overall health of the global economy. It is consumer-dependent and when households cut back on their spending, unsold cars can quickly pile up, leading to cuts in production. Watch this space: To date, China has not cracked the international automotive sector, although there have been attempts to build a cheap domestic car that could also flood the global marketplace. China could still become a major protagonist in automobiles through its own research or by acquiring foreign manufacturers.

• Influencing Factors

  The state of the economy determines whether people and businesses spend on new vehicles or upgrade them. Other factors include the growing demand in the emerging markets as well as taxation and the overall increasing running costs of vehicles in many countries across the world.