Automotive industry explained

The automotive industry comprises a wide range of companies and organizations involved in the design, development, manufacturing, marketing, selling, repairing, and modification of motor vehicles. It is one of the world's largest industries by revenue (from 16% such as in France up to 40% to countries like Slovakia).[1]

The word automotive comes from the Greek autos (self), and Latin motivus (of motion), referring to any form of self-powered vehicle. This term, as proposed by Elmer Sperry[2] (1860–1930), first came into use to describe automobiles in 1898.[3]

History

See main article: History of the automobile.

The automotive industry began in the 1860s with hundreds of manufacturers pioneering the horseless carriage. Early car manufacturing involved manual assembly by a human worker. The process evolved from engineers working on a stationary car, to a conveyor belt system where the car passed through multiple stations of more specialized engineers. Starting in the 1960s, robotic equipment was introduced to the process, and most cars are now mainly assembled by automated machinery.[4]

For many decades, the United States led the world in total automobile production, with the U.S. Big Three General Motors, Ford Motor Company, and Chrysler being the world's three largest auto manufacturers for a time, and G.M. and Ford remaining the two largest until the mid-2000s. In 1929, before the Great Depression, the world had 32,028,500 automobiles in use, of which the U.S. automobile enterprises produced more than 90%. At that time, the U.S. had one car per 4.87 persons.[5] After 1945, the U.S. produced around three-quarters of the world's auto production. In 1980, the U.S. was overtaken by Japan and then became a world leader again in 1994. Japan narrowly passed the U.S. in production during 2006 and 2007, and in 2008 also China, which in 2009 took the top spot (from Japan) with 13.8 million units, although the U.S. surpassed Japan in 2011, to become the second-largest automobile industry. In 2023, China had for the first time in history more than 30 million produced vehicles a year, after reaching 29 million for the first time in 2017 and 28 million the year before. From 1970 (140 models) over 1998 (260 models) to 2012 (684 models), the number of automobile models in the U.S. has grown exponentially.[6]

Safety

See main article: Automobile safety.

See also: 2009–2011 Toyota vehicle recalls, General Motors ignition switch recalls and Firestone and Ford tire controversy.

Safety is a state that implies being protected from any risk, danger, damage, or cause of injury. In the automotive industry, safety means that users, operators, or manufacturers do not face any risk or danger coming from the motor vehicle or its spare parts. Safety for the automobiles themselves implies that there is no risk of damage.

Safety in the automotive industry is particularly important and therefore highly regulated. Automobiles and other motor vehicles have to comply with a certain number of regulations, whether local or international, in order to be accepted on the market. The standard ISO 26262, is considered one of the best practice frameworks for achieving automotive functional safety.[7]

In case of safety issues, danger, product defect, or faulty procedure during the manufacturing of the motor vehicle, the maker can request to return either a batch or the entire production run. This procedure is called product recall. Product recalls happen in every industry and can be production-related or stem from raw materials.

Product and operation tests and inspections at different stages of the value chain are made to avoid these product recalls by ensuring end-user security and safety and compliance with the automotive industry requirements. However, the automotive industry is still particularly concerned about product recalls, which cause considerable financial consequences.

Economy

See also: Automotive industry by country.

In 2007, there were about 806 million cars and light trucks on the road, consuming over 980e9litres of gasoline and diesel fuel yearly.[8] The automobile is a primary mode of transportation for many developed economies. The Detroit branch of Boston Consulting Group predicted that, by 2014, one-third of world demand would be in the four BRIC markets (Brazil, Russia, India, and China). Meanwhile, in developed countries, the automotive industry has slowed.[9] It is also expected that this trend will continue, especially as the younger generations of people (in highly urbanized countries) no longer want to own a car, and prefer other modes of transport.[10] Other potentially powerful automotive markets are Iran and Indonesia.[11] Emerging automobile markets already buy more cars than established markets.

According to a J.D. Power study, emerging markets accounted for 51 percent of the global light-vehicle sales in 2010. The study, performed in 2010 expected this trend to accelerate.[12] [13] However, more recent reports (2012) confirmed the opposite; namely that the automotive industry was slowing down even in BRIC countries.[9] In the United States, vehicle sales peaked in 2000, at 17.8 million units.[14]

In July 2021, the European Commission released its "Fit for 55" legislation package,[15] which contains important guidelines for the future of the automotive industry; all new cars on the European market must be zero-emission vehicles from 2035.[16]

The governments of 24 developed countries and a group of major car manufacturers including GM, Ford, Volvo, BYD Auto, Jaguar Land Rover and Mercedes-Benz committed to "work towards all sales of new cars and vans being zero emission globally by 2040, and by no later than 2035 in leading markets".[17] [18] Major car manufacturing nations like the United States, Germany, China, Japan and South Korea, as well as Volkswagen, Toyota, Peugeot, Honda, Nissan and Hyundai, did not pledge.[19]

Environmental impacts

The global automotive industry is a major consumer of water. Some estimates surpass of water per car manufactured, depending on whether tyre production is included. Production processes that use a significant volume of water include surface treatment, painting, coating, washing, cooling, air-conditioning, and boilers, not counting component manufacturing. Paintshop operations consume especially large amounts of water because equipment running on water-based products must also be cleaned with water.[20]

In 2022, Tesla's Gigafactory Berlin-Brandenburg ran into legal challenges due to droughts and falling groundwater levels in the region. Brandenburg's Economy Minister Joerg Steinbach said that while water supply was sufficient during the first stage, more would be needed once Tesla expands the site. The factory would nearly double the water consumption in the Gruenheide area, with 1.4 million cubic meters being contracted from local authorities per year — enough for a city of around 40,000 people. Steinbach said that the authorities would like to drill for more water there and outsource any additional supply if necessary.[21]

World motor vehicle production

By year

See also: List of countries by motor vehicle production.

YearProductionChangeSource
199754,434,000[22]
199852,987,000 2.7%
199956,258,892 6.2%[23]
200058,374,162 3.8%[24]
200156,304,925 3.5%[25]
200258,994,318 4.8%[26]
200360,663,225 2.8%[27]
200464,496,220 6.3%[28]
200566,482,439 3.1%[29]
200669,222,975 4.1%[30]
200773,266,061 5.8%[31]
200870,520,493 3.7%[32]
200961,791,868 12.4%[33]
201077,857,705 26.0%[34]
201179,989,155 3.1%[35]
201284,141,209 5.3%[36]
201387,300,115 3.7%[37]
201489,747,430 2.6%[38]
201590,086,346 0.4%[39]
201694,976,569 4.5%[40]
201797,302,534 2.36%[41]
201895,634,593 1.71%[42]
201991,786,861 5.2%[43]
202077,621,582 16%[44]
202180,145,988 3.25%[45]
202285,016,728 6.08%[46]

By country

See main article: Automotive industry by country.

The OICA counts over 50 countries that assemble, manufacture, or disseminate automobiles. Of those, only 15 countries (boldfaced in the list below) currently possess the capability to design original production automobiles from the ground up, and 17 countries (listed below) have at least one million produced vehicles a year (as of 2023).[47]


Country Produced vehicles 2023[48]
China
(plus Taiwan)
30,160,966
(30,446,928)
USA 10,611,555
Japan 8,997,440
India 5,851,507
Republic of Korea 4,243,597
Germany 4,109,371
Mexico 4,002,047
Spain 2,451,221
Brazil 2,324,838
Thailand 1,841,663
Canada 1,553,026
France 1,505,076
Turkey 1,468,393
Czechia 1,404,501
Indonesia 1,395,717
Slovakia 1,080,000
U.K. 1,025,474

By manufacturer

See main article: List of manufacturers by motor vehicle production.

See also: List of car brands.

Top 10 (2016–2020)

These were the ten largest manufacturers by production volume as of 2017,[49] of which the eight largest were in the top 8 positions since Fiat's 2013 acquisition of the Chrysler Corporation (although the PSA Group had been in the top 8 1999 to 2012, and 2007 to 2012 one of the eight largest along with the seven largest as of 2017) and the five largest in the top 5 positions since 2007, according to OICA, which, however, stopped publishing statistics of motor vehicle production by manufacturer after 2017. All ten remained as the ten largest automakers by sales until the merger between Fiat-Chrysler and the PSA Group in early 2021; only Renault was degraded to 11th place, in 2022, when being surpassed by both BMW (which became the 10th largest in 2021) and Chang'an.[50]

Rank Group Country data-sort-type="number" Produced
vehicles (2017) !
data-sort-type="number" Sold vehicles
(2018) !
data-sort-type="number" Sold vehicles
(2019)[51]
1Japan 10,466,051 10,521,134 10,741,556
2Germany 10,382,334 10,831,232 10,975,352
3General Motors
(except SAIC-GM-Wuling)
United States 9,027,658
(6,856,880)
8,787,233 7,724,163
4HyundaiSouth Korea 7,218,391 7,437,209 7,189,893
5FordUnited States 6,386,818 5,734,217 5,385,972
6Japan 5,769,277 5,653,743 5,176,211
7Japan 5,235,842 5,265,892 5,323,319
8Fiat-Chrysler
(now part of Stellantis)
Italy /
United States
4,600,847 4,841,366 4,612,673
9France 4,153,589 3,883,987 3,749,815
10PSA Group
(now part of Stellantis)
France 3,649,742 4,126,349 3,479,152

Top 20 (2012–2013)

These were the twenty largest manufacturers by production volume in 2012 and 2013, or the 21 largest in 2011 (before the Fiat-Chrysler merger), of which the fourteen largest as of 2011 were in the top 14 in 2010, 2008 and 2007 (but not 2009, when Changan and Mazda temporarily degraded Chrysler to 16th place). The eighteen largest as of 2013 have remained in the top 20 as of 2017, except Mitsubishi which fell out of top 20 in 2016, while Geely fell out of the top 20 in 2014 and 2015 but re-entered it in 2016.

Rank Group Country data-sort-type="number" Produced
vehicles (2013)[52] !
data-sort-type="number" Produced
vehicles (2012)[53] !
data-sort-type="number" Produced
vehicles (2011)[54]
1 Japan 10,324,995 10,104,424 8,050,181
2 United States 9,628,912 9,285,425 9,031,670
3 Germany 9,379,229 9,254,742 8,525,573
4 South Korea 7,233,080 7,126,413 6,616,858
5 United States 6,077,126 5,595,483 5,516,931
6 Japan 4,950,924 4,889,379 4,631,673
7 Italy 4,681,704 4 498 722 2,336,954
8 Japan 4,298,390 4,110,857 2,909,016
9 France 2,833,781 2,911,764 3,582,410
10 Japan 2,842,133 2,893,602 2,725,899
11 France 2,704,675 2,676,226 2,825,089
12 Germany 1,781,507 2,195,152 2,137,067
United States part of FCA part of FCA 1,999,017
13 Germany 2,006,366 2,065,477 1,738,160
14 China 1,992,250 1,783,548 1,478,502
15 India 1,062,654 1,241,239 1,197,192
16 Japan 1,264,173 1,189,283 1,165,591
17 China 1,238,948 1,137,950 1,108,949
18 Japan 1,229,441 1,109,731 1,140,282
19 China 1,109,889 1,063,721 1,167,208
20 China 969,896 922,906 897,107

Notable company relationships

Stake holding

It is common for automobile manufacturers to hold stakes in other automobile manufacturers. These ownerships can be explored under the detail for the individual companies.

Notable current relationships include:

Joint ventures

China joint venture

Outside China

See also

Further reading

Notes and References

  1. The 2021 EU Industrial R&D Investment Scoreboard . 27 February 2022. European Commission.
  2. Book: Scientific and Technical Societies of the United States . 1968 . National Academy of Sciences . Washington, DC . 164 . Eighth . 25 March 2014.
  3. Web site: Automotive Industry . carbidebur.com . 26 November 2023.
  4. Web site: 24 September 2010 . The Timeline: Car manufacturing . Alice-Azania . Jarvis . The Independent . 19 April 2024.
  5. U.S. Makes Ninety Percent of World's Automobiles . Popular Science . November 1929 . 84 . 115 . 5 . 6 August 2013 .
  6. Aichner . Thomas . Coletti . Paolo . 2013 . Customers' online shopping preferences in mass customization . Journal of Direct, Data and Digital Marketing Practice . 15 . 1 . 20–35 . 10.1057/dddmp.2013.34 . 167801827 . free.
  7. Web site: ISO 26262-10:2012 Road vehicles -- Functional safety -- Part 10: Guideline on ISO 26262 . International Organization for Standardization . 25 March 2014.
  8. Web site: Plunkett Research . Automobile Industry Introduction . 2008 . 25 March 2014 . dead . https://web.archive.org/web/20101219120341/http://plunkettresearch.com/Industries/AutomobilesTrucks/AutomobileTrends/tabid/89/Default.aspx . 19 December 2010 .
  9. Web site: Developing economies slowing down . https://web.archive.org/web/20121013151102/http://www.twnside.org.sg/title2/gtrends/gtrends396.htm . Martin . Khor . 13 October 2012 . twnside.org.sg . 21 July 2015.
  10. Web site: 2014 Global Automotive Consumer Study: Exploring consumer preferences and mobility choices in Europe . Deloittelcom . 3 July 2015 . https://web.archive.org/web/20150704135550/http://www2.deloitte.com/content/dam/Deloitte/global/Documents/Manufacturing/gx-global-automotive-consumer-study-europe-final.pdf . 4 July 2015 .
  11. Web site: Paul A.. Eisenstein. Building BRIC's: 4 Markets Could Soon Dominate the Auto World . thedetroitbureau.com. 21 January 2010 .
  12. Web site: The Truth About Cars. Bertel Schmitt. Auto Industry Sets New World Record In 2010. Will Do It Again In 2011. 15 February 2011. 6 April 2019.
  13. Web site: J.D. Power and Associates. Global Automotive Outlook for 2011 Appears Positive as Mature Auto Markets Recover, Emerging Markets Continue to Expand. 15 February 2011. 7 August 2011. https://web.archive.org/web/20110217022100/http://businesscenter.jdpower.com/news/pressrelease.aspx?ID=2011018. 17 February 2011. dead.
  14. Web site: U.S. vehicle sales peaked in 2000 . The Cherry Creek News . 27 May 2015 . 18 June 2015 . https://web.archive.org/web/20150528010752/http://www.thecherrycreeknews.com/u-s-vehicle-sales-peaked-in-2005/ . 28 May 2015 . dead .
  15. News: European Green Deal: Commission proposes transformation of EU economy and society to meet climate ambitions . European Commission . 14 July 2021.
  16. News: Fit for 55: European Union to end sale of petrol and diesel models by 2035 . Autovista24 . 14 July 2021.
  17. News: COP26: Deal to end car emissions by 2040 idles as motor giants refuse to sign . https://ghostarchive.org/archive/20221210/https://www.ft.com/content/8c4a1809-902f-4582-a29e-1c83a97b9dff . 10 December 2022 . subscription . Financial Times . 8 November 2021.
  18. News: COP26: Every carmaker that pledged to stop selling fossil-fuel vehicles by 2040 . CarExpert . 11 November 2021.
  19. News: COP26: Germany fails to sign up to 2040 combustion engine phaseout . Deutsche Welle . 10 November 2021.
  20. Web site: Isaiah . David . Water, water, everywhere in vehicle manufacturing . Automotive World . 6 October 2014.
  21. News: Raymunt . Monica . Wilkes . William . Elon Musk Laughed at the Idea of Tesla Using Too Much Water. Now It's a Real Problem . bloomberg.com . 22 February 2022 . en.
  22. Web site: oica.net. 1998 - 1997 world motor vehicle production by type and economic area. 21 July 2015.
  23. Web site: 1999 Production Statistics. oica.net.
  24. Web site: 2000 Production Statistics. oica.net.
  25. Web site: 2001 Production Statistics. oica.net.
  26. Web site: 2002 Production Statistics. oica.net.
  27. Web site: 2003 Production Statistics. oica.net.
  28. Web site: 2004 Production Statistics. oica.net.
  29. Web site: 2005 Production Statistics. oica.net.
  30. Web site: 2006 Production Statistics. oica.net.
  31. Web site: 2007 Production Statistics. oica.net.
  32. Web site: 2008 Production Statistics. oica.net.
  33. Web site: 2009 Production Statistics. oica.net.
  34. Web site: 2010 Production Statistics. oica.net.
  35. Web site: 2011 Production Statistics. oica.net.
  36. Web site: 2012 Production Statistics. oica.net.
  37. Web site: 2013 Production Statistics. oica.net.
  38. Web site: 2014 Production Statistics. oica.net.
  39. Web site: 2015 Production Statistics. oica.net.
  40. Web site: 2016 Production Statistics. oica.net.
  41. Web site: 2017 Production Statistics. oica.net.
  42. Web site: 2018 Production Statistics. oica.net.
  43. Web site: 2019 Production Statistics. oica.net.
  44. Web site: 2020 Production Statistics. oica.net.
  45. Web site: 2021 Production Statistics. oica.net.
  46. Web site: 2022 Production Statistics. oica.net.
  47. News: Jared . Lynch . Mark . Hawthorne . Australia's car industry one year from closing its doors . The Sydney Morning Herald . 17 October 2015 . 27 May 2017 . https://web.archive.org/web/20170527042758/http://www.smh.com.au/business/the-economy/australias-car-industry-one-year-from-closing-its-doors-20151012-gk7ip0.html . 27 May 2017 . live .
  48. Web site: World Motor Vehicle Production by Country/Region and Type . OICA . 13 August 2024.
  49. Web site: World Motor Vehicle Production: World Ranking of Manufacturers, Year 2017 . . 5 May 2019.
  50. Web site: Top 15 Automakers in the World | Car Sales Rank Worldwide .
  51. Web site: 2020 Worldwide Car Sales by Manufacturer . F&I Tools USA . 2022 . 4 January 2024.
  52. Web site: World Ranking of Manufacturers Year 2013 . OICA . 13 August 2024.
  53. Web site: World Ranking of Manufacturers Year 2012 . OICA . 13 August 2024.
  54. Web site: World Ranking of Manufacturers Year 2011 . OICA . 13 August 2024.
  55. Web site: Perusahaan Ootmobil Kedua . Second Automobile Company . Perodua . Malaysia . 17 January 2017 . ms . https://web.archive.org/web/20170117015645/http://www.perodua.com.my/corporate/company . 17 January 2017.
  56. News: Sun . Edward . Taylor . Yilei . 23 July 2019 . China's BAIC buys 5% Mercedes-Benz Group stake to cement alliance . Reuters . US . 5 December 2020.
  57. News: China's Geely to Acquire Stake in Malaysian Carmaker Proton. 23 May 2017. Bloomberg.com. 28 June 2017.
  58. Web site: Mercedes and Geely joint ownership of Smart. 5 December 2020. Auto Express. en.
  59. News: Nissan to take 34% stake in Mitsubishi Motors . BBC News . 12 May 2016 . en-GB. 1 July 2016.
  60. http://www.caradvice.com.au/572997/toyota-buys-stake-in-mazda-joint-us-factory-ev-development-planned/ Toyota buys stake in Mazda, joint US factory, EV development planned | CarAdvice
  61. News: Toyota pulls Suzuki firmly into its orbit through stake deal. 28 August 2019. Reuters. 11 February 2020. en.
  62. Web site: Corporate Introduction . Chery Jaguar Land Rover . 5 December 2020.
  63. Mercedes-Benz and Geely Holding have formally established its global joint venture "smart Automobile Co., Ltd." for the smart brand. 5 December 2020 . media.daimler.com . en.