The Automotive Industry

The Automotive Industry

Basic economics - if the profits are going down it's because not enough product is selling because there is not enough demand for it at the current price. So to correctly manage the company, it must respond to supply and demand and lower the price until enough product will be purchased to gain profit for the company, or until they would lose less money than just going out of business. Seeing as how this has already happened and they asked the government for money, it means their companies were mismanaged and they are attempting to thrive in an industry that cannot support itself.

If the automotive manufacturing industry closed, the auto repair industry would shoot through the roof. Tons more people would learn how to fix cars and so the competition to get a job in the industry would be more fierce and the quality of average repair work would go way up. Some industries would even manufacture some new car parts that were profitable to manufacture and the parts industries that support automotive repair would boom.

In short, the industry would change, the bad would be forced out, and the good would come marching in. The price of used cars would get closer to the price of a new car today, and new cars would be selling for millions on Ebay, and eventually, though perhaps not for years, a company would figure out a way to make an affordable and industry-sustaining vehicle. Science and technology will have progressed to make it succinctly more advanced than what we have today, but it will be a step forward.

Bookmark/Search this post with:

 •    •    •    •    •    •    •    •    •    •