Automotive Industry in the United States

US Automotive Industry: Industry Overview

The US Automotive industry is among the leading in the world with shipments in 2019 amounting to US$ 643.9 billion in value. Furthermore, the automotive industry in the US is fairly fragmented with the presence of 5,880 firms as of 2019. However, the industry witnesses a slight slump of 0.1% in its value over the previous year.

The Automotive industry employs 6,849 which is one among the leading the US manufacturing sector. The annual mean wage for the workers was found to be a modest US$ 48,020 in2018. The average weekly hours worked by the employees was found to be 43.5 h

Table of Contents

    Though the international and domestic partnerships have reduced the manufacturing expenses and improved the R &D efficiency, the R&D in the automotive sector in the USA is mediocre. The automotive industry in the US is subjected to stringent federal regulations related to fuel efficiency & R&D expenditures which significantly impact the industry

    USA automobile imports increased by 2.3% in 2019. Value added by the automotive industry grew by 2.7% during 2018. R&D spending increased by nearly 9.1% per annum during 2014 to 2017 period. The patents issued related to the automotive industry in the USA from 2012 to 2016 increased by 9.2% per annum.

    Automotive Industry

    Ford Motor Company had the largest revenue in the automotive sector in the USA in 2018 with US$ 160,338 million followed by General Motors with US$ 147,049 million, PACCAR Inc with US$ 23,501 million, and Tesla Inc with US$ 21,461 million. American consumers prefer European and Asian vehicles due to the bad reputation of the American automotive vehicles

    US Automotive Industry: Global positioning

    Automotive Industry

    It can be seen that the US automotive industry was the second largest in the world trailing behind China which has a market value of US$ 713.2 Billion in 2019. Furthermore, the automotive industry in China is anticipated to grow at a CAGR of 2.3% from 2019-2023 whereas, the industry is expected to grow at a CAGR of 1.6% in the US during the same period. This is followed by Germany and U.K. with a growth rate of 1.2% and 0.5% respectively

    Recent Trends in U.S. Automotive Industry

    Growing adoption of Hybrid and Electric Vehicles (EV)

    Over the past few years, with the rising investment in R&D by the government as well as organizations in the development of Electric vehicles, the adoption of Electric vehicles (EV) is gaining traction.

    Moreover, the drastic improvement in battery technology is stretching the miles per charge significantly. We now have hybrid vehicles and electric vehicles with a range of 500 miles which indicates a significant development.

    Furthermore, the governments across the world are promoting stringent greenhouse gas emissions standards for internal combustion engines vehicles. Additionally, governments are providing tax breaks, improving electric charging infrastructures and availing more incentives for electric vehicles.

    This has encouraged various numerous electric vehicle start-ups to enter the automotive space for the manufacturing of EVs. Tesla Inc. is a great example of a company that made it big. Tesla has witnessed a significant surge in the electrical vehicles product segment with its EV models.

    Rising adoption of technology

    The increasing adoption of digital technologies is leading automobiles towards autonomy and taking the concept of self-driving cars close to reality.

    Internet of things, artificial intelligence, and machine learning are improving connected cars and autonomous vehicle technologies. The presence of Google, Apple, Amazon, Uber, and other tech giants in the research and development in the autonomous vehicle segment has a huge impact on the traditional automotive manufacturers.

    Takeaways for Manufacturers and dealers

    With the rising adoption of electric vehicles in the US, manufacturers who have not yet entered the EV space can form strategic alliances with smaller manufactures of Electric vehicles and expand their product line-up.

    Established manufacturers are pouring heavy investments into making the concept of self-driving cars a reality. Car manufacturers can focus more on the technology aspect of automotive to make the vehicles smarter and intelligent. This will also ensure driver safety along with driving pleasure.

    Manufacturers can also focus on the manufacturing of batteries and supplying them to other car manufacturers at modest margins by taking advantage of the EV boom.

    There is a paradigm shift that is happening in the way consumers shop for a car. Car dealers and showroom makers need to take extra effort to reach out to their consumers especially in this situation of a pandemic. They can organize online surveys to know their consumers better, have a provision for booking online appointments for test drives, and also make it possible for the consumer to shop for a car from their homes.

    With the highly competitive market dynamics, it is essential for the car dealers to provide pick up and drop service for the consumers willing to service their cars. Also, manufacturers should invest more in making their websites more appealing thereby giving the potential buyers or a customer an immersive and fulfilling experience.

    Also, manufacturers can arrange for video consultations for their customers for supporting them to make their purchase decisions and helping to reach out in case of concerns.

    Must Read:
    Software-Defined Wide Area Network (SD-WAN)

    Best Python Framework for Web Application in 2020

    Top 10 Django Apps and Why Companies Are Using it?

    What is eSIM? Pros & Cons Explained: All You Need to Know

    1 thought on “Automotive Industry in the United States”

    1. Pingback: Industrial Automation | Types of Industrial Automation | Advantages and Disadvantages - Explore End2End

    Leave a Reply

    Your email address will not be published. Required fields are marked *