Category: Automobiles

An Entrant’s Guide to The Automobile IndustryAn Entrant’s Guide to The Automobile Industry

The automobile industry involves all those organizations and operations engaged in the designing, building, promotion, production, and selling of motor vehicles that include most parts, such as engines and bodies, however not including tires, batteries, and fuel.

Today, automobiles play a significant role in the lives of people. One cannot think of a world without automobiles. The automobile is used for transferring both passengers and goods, hence it functions as a lifeline for people. 

Now let’s check out the basic components of the automobile industry

  • Light Motor Vehicles – These include motorcycles and cars utilized for business conveyance comprising of goods and people. Some of the examples of light vehicles are SUVs, passenger cars, pick-up trucks, and more.
  • Trucks and Buses – These include commercial vehicles that are used for transferring goods and people. Good examples of these vehicles are coaches, trailers, heavy and light buses, etc.
  • Construction and Agricultural Vehicles (CAV) – These include industrial machinery used for mining, farming, or at the construction places to dig the earth. Some of the examples of these vehicles include earthmovers, tractors, harvesters, bulldozers, road rollers, dumpers, excavators, and more.
  • Electric & Plug-In Hybrid Electric Vehicles –In place of a gasoline tank, and an internal combustion engine, electric vehicles come with a battery and an electric motor. However, plug-in hybrid electric vehicles consist of both electric vehicles and gasoline.
  • Autonomous vehicles – These include self-driving cars, driverless or robotic cars that can understand their surroundings and travel without the need for human input. Autonomous vehicles leverage GPS, radar, and computer vision to check their environment.

Automotive Value Chains

The value chain encloses almost all the activities ranging from the idea of the product to the final delivery to the customer. The value chain of a company engaged in the manufacturing of goods starts from the purchasing of raw materials. The processes involved in the value chain give the product its value till it is available for sale. 

Now let’s look at the automobile industry’s value chain

  • Inbound Logistics: It involves getting raw materials from providers who are located in various places around the world. On receiving the raw materials, the automobile industry will provide them among the production units on the basis of requirements.
  • Design and Manufacture: During this stage, raw materials are transformed into a product. 
  • Engineering – It mainly deals with the engineer’s flexibility to produce vehicles. It also involves reducing the time of engineering by searching and expanding solutions. 
  • Marketing and Sales – This is actually a significant part of the value chain of a vehicle manufacturing firm. It involves allocation, supervision of sales force, advertising, marketing, and supervision of customer relationships. Generally, marketing and sales are done to make sure that the product reaches to intended audiences. Several companies in the automobile industry consider blockchain as a strong financial tool and plan to implement it to manage payments in the industry. The number of cryptocurrency users are increasing rapidly as the value of various cryptocurrencies are appealing to the investors. Visit to know how to buy cryptocurrencies with Paypal. 
  • Service – In fact, this is the last activity involved in the value chain of the automobile industry and which gives the product its value. It includes after-the-sale support that is appropriate for their vehicle maintenance. 

Competitive Advantages in the Automobile Industry

Time to market, prediction, inventory management is the competitive advantages in the automobile industry