Economcs Essay Example | Topics and Well Written Essays - 2000 words

Economcs - Essay Example The company is especially famous for its contribution of the assembly line, granting the mass production of automobiles by 1913 (Ford motor, n.d.). For decades, it remained to be the second largest automaker worldwide, only behind General Motors (Freysennet, 1998). Today Ford has major operations in America, Asia Pacific Africa, and Europe. It used to manufacture diverse car and truck brands, to wit, Ford, Lincoln, Mazda, Jaguar, Aston Martin, Volvo, Land Rover and Mercury (Freysennet, 1998). Recently, however, it is streamlining (though less than an overhauling) its global and domestic approach to avert unwanted outcomes. Ford sold off Jaguar, Aston Martin, Land Rover, Volvo; and conclusive in ceasing the production of Mercury by the end of this year (Weaver, 2010). Threat of Substitutes. Automobiles give the end-users a sense of individuality which other modes of transportation (e.g. trains, and buses) don’t inherently offer. However this doesn’t give them an entire advantage. Owning private vehicles doesn’t only involve a costly purchase but also entails a probably costly responsibility as well in sustaining its usability mainly in times like repairing damaged parts/areas, or supplying gasoline. Moreover, in a global perspective, people are culturally and/or socially distinct (Bradley, et al., 2005). Not all people find automobiles a commodity. Thus, the threat of substitutes is only fair and varies greatly in different geographic market locations. Rivalry between Established Competitors. Though the oligopolistic structure of the automotive industry should partly eliminate price-based competition, the concentration ratios could no longer disguise the ongoing competition (Bradley, et al., 2005). This may not even be some sleazy plan to reinforce competition but a by-product of the economic slumps such that companies ultimately attempted to generate maximum sales to finance its operations. With Honda, Toyota,