The Auto Industry In Today’s World Essay

This Report aims at explaining the automotive supply chain by the listing of various OEMS and their suppliers in the automotive industry.Reading of this report will help the readers explain

Introduction

The Automotive industry is comprised of a supply chain starting from Tier 3 suppliers that provide raw materials or near to raw materials to the tier 2 companies that manufacture some components that is sold to the tier 1 companies that make more sophisticated modules or components from the items received from the tire 2 company. The OEM’s(Original Equipment Manufacturer) or in this case the Automotive company (that provides finished goods to the Dealerships) receive the modules from the tier 1 companies and sometimes from the tier 2 companies, assemble the parts and make the final Car that is sold under a brand name of the company. The OEM’s:In this report we will list five OEM’s from atleast 3 different countries and learn about the OEM, a brief history, strength of the company in terms of number of employees, annual revenue.This report will also list the brands with some models specific to the particular OEM’s.

FORD MOTOR COMPANY

President and CEO-James Patrick Hackett (Jim Hackett)| May 22,2017-present.Ford motor company is an American Mulinational Automaker established in June 16,1903 by Henry Ford. It has its headquarters in Dearborn, Michigan.It sells most of its cars under the Brand name of Ford and Luxury Cars under the brand Lincoln

History

It was in 1901 when Henry ford launched his first company under the name Henry Ford Compnay which later changed to Cadillac Motor Company. In 1902 He left the company rights to his name.In the Year 1903 he again launched a company under the name Ford Motor Company along with 12 Investors. The 1st President of the company was not ford instead it was John S. Grey who was a local banker. This was done in public interest as ford did not want the public to lose interest in the company by thinking that Ford would leave the company as he did with the previous one.The Ford Model T car which should almost millions over 20 years was introduced in 1908.In 1932 Ford launched its first V8 engine and It was not until 1964 when the Ford mustang was Introduced and took the market by a sweep.Ford received a large annual loss of $12.7 billion in 2006 which it partially recovered in 2007 and ended the year with a loss of $2.7 billion. In-evidently Ford had to sell its Jaguar and Landrover companies to Tata Motors (Which we will list later in the report) in 2008.

Overview

(Data primarily based on stats of 2016)Ford motor company is relatively a large company with an employee base of around 201,000 as of December, 2016 and has a total equity of $34.918 billion(2017) and an annual revenue of $156.8 million. Ford sold around 6.7 million units including both ford and Lincoln through 11700 dealers in 2016.Ford has a total 62 plants comprising of automobiles and other commodities like transmission, engines and many more to name.Products and services Ford motor company is basically involved in the products listed below:1. Automobiles: Ford sells Cars under the marque of ford in worldwide and also as Lincoln in United states. As per the announcement made by ford in 2015 it is now shifting its focus to be primarily be on trucks and SUV’s.

Ford transit bus

Trucks: Ford is into the Trucks business from 1908 with the very first truck names Ford TT.some names are:-Ford F-series, N-series etc. Ford N series tractor

Tractors: Ford started its Tractor business as ‘Henry ford and son company’ producing tractors under the name of Fordson tractors.4.Busses-Ford used to manufacture complete busses back in the days but now has primarily become a second stage manufacturer supplying chassis and parts to companies like blue bird.

General Motors Company (new GM)

President and CEO- Marry T. Barra| January 2014General motors company or simply GM(General motors)as most people call it is ne of the first and world’s biggest Automobile companies with its headquarters in Renaissance centre, Detroit Michigan .Its most famous Brand is GMC in the average consumer category

History

General Motor Corporation (old GM) was established by William C.Durant in 1908 as a holding company.The company .Durant bought and merged companies like Cadillac and Pontiac, Elmore and many other in the year 1909.It was the biggest automaker from 1931 through 2007 before its bankcruptcy in 2009 after which the General Motor Company (new GM) was established which bought all th shares of General motor corporation and aslo the brand “General motors”.

Overview

General motors made an annual revenue of about $146 billion in the year 2017 with around 9.6 million units sold.This number was achieved by GM with about nine Brands under its name like Caddilac, Buick,Gmc and many more with an employee strength of about 180000 in 2017.Source:General motors ,Copywright Statista.GM has 100 facilities in US alone and the GM financial has 50 Facilities.GM also has various facilities in around 60 countries worldwide.ProductsGM sells most of its low cost cars under the brand name of Chevrolet,Pickups generally under the brand of GMC and Luxury cars include caddilac.GM has also involved it self in many Hybrid and electric vehicles range like the chevy Volt,Bolt and many more. It also introduces the GM electrovan one of the first Fuel cell powered carsAt present GM is actively involved in Cars ranging and covering every aspect of the society From small cars like Bolt to High power large cars like the Pickups.GM is also involved in making battery packs for EV’s with its production facility in Southern Michigan.

TATA MOTORS

Tata Motors is an Indian Multinational automotive company with its headquarters in Mumbai,India. It is a part of Tata Group. It has many Brands under its name with the most famous being the TATA, Jaguar and Land Rover.

History

Previously known as the Tata Engineering and Locomotive Company (TELCO) was found in 1945. It was the first Indian company to obtain the capability of developing a competitive automobile. Its first passenger car was TATA Indica.It also lauched the worls cheapest car TATA nano at only about INR 1,50,000. In 2008 it acquired the Jaguar Land Rover from Ford in order to help for recover its debts.OverviewThe company has a total net worth of $41.066 billion as of 2017 and generated about $43.910 billion as annual avenue so far in the year 2018. The number of employees that work for Tata Motors as per that stats of 2018 are around 82000 .

Tata Motors has more than 20 sites across Asia, Africa and Europe including Research and development, Manufacturing and Design.With such a setup Tata Motors managed to get a 64% growth rate with164,579 units sold.ProductsCars and Utility Vehicles:Tata motors sells a number of models of cars under various brand names , namely Land Rover, Tata, JaguarTrucks and busses: Tata has a joint venture with Marcopolo as Tata-Marcopolo and Tata-Daewoo to enter the market of Trucks and busses.The most commonly used small size truck is Tata-407. Defence:Tata Motors has been working in the defence segment from 1940. In world war II Tata motors supplied military grade steel armours. Later it has developed many vehicles for War and military use like the Tata LAMV.

Toyota Motor Corporation

Toyota Motor Corporation or simply Toyota is a Japanese Automaker company which was established in 1937 with its headquarters in Aichi, Japan.It is the Fifth largest automaker in the world.

History

Toyota Motor Corporation started its production in 1933 as a subsidiary of Toyota Automatic Loom Compnay under the leadership of Kiichiro Toyoda the son of Sakichi Toyoda who laid the foundations of Toyota Automatic Loom Works.Thw first Car was the Toyota A1 and G1 in 1935.It was in 1937 it was renamed as the Toyota Motor Corporation after the Hand Loom Works was sold to Palt Brothers

Overview

Toyota is the worls Fifth larget automaker in terms of total annual revenue as of 2017 with the numbers being $260.8 billion and an employee base of 364,445.It has a total of 51 overseas production facilities and a total of 19 facilities in Japan.It sold approximately 10.4 million units in 2018 so far.ProductsToyota mainly deals in the following sectorsAutomobiles: Selling majority of the cars under tha brand name of Toyota and actively participating in EV, PHEV, and ZEV vehicles.It produces vehicles ranging from passenger cars to SUV’S and also Pick-Up trucks.Toyota Prius (Hybrid)SourceAvalon

Volkswagen Group

The German Multinational Automotive OEM Volkswagen Aktiengessellschaft is internationally known as Volkswagen Group and has its headquarters in Wolfsburg, Lower Saxony, Germany.

History

It was founded in 1937 as the Gesellschaft zur Vorbereitung des Deutschen Volkswagens mbH and now known as the Volkswagen Group by Deutsche Arbeitsfront. It produced its first car Porche Type 82 during world war II.OverviewVolkswagen Group was the worlds largest automaker in 2017 with total of 10.6 million units sold through its 100 production facilities across 27 countries achieving a total annula revenue of 230.7 billion Euros. It has an employee base of 642,000.ProductsAutomobile: Volkswagen has a number of brands including Audi, Bugatti, Lamborghini and many more producing a variety of passenger cars in both economy and Luxury profiles. Some examples are-volkswagen Pinto(discontinued), Audi A1 etc.Motor Cycles: It also sells Motor Bikes under the brand name of Ducatti Trucks and Busses: Volkswagen also has a brand name Traton AG under which it sells wagons and Trucks. VolkswageTraton Ag Scaniaard

Volkswagen-Beetle-India-Launch.jpgIn this section we discuss about some common differences between an Automotive company, a brand and a model.As we all know a company in automotive sector simply refers to an OEM. As the name suggests the company is the original equipment manufacturer, this might be partially true in case of Automakers. As most of the times they manufacture very less parts and usually source most of the equipment from a tier 1 supplier.

To sum up an Automotive Company is basically the facility that produces the various cars under the Brand names it owns. Example: Tata Motors, Volkswagen GroupWhereas a Brand is usually owned by a company to advertise and market its products. In case of Automotive sector an OEM own various brands which specify which class that particular car belongs. Brand names are used to create an image of a particular line of products in some specific personality.

Example: Volkswagen Group is a company which owns many Brands such as Bugatti, Lamborghini, and Volkswagen.Now a model is basically a particular product that is produced by any company under a specific brand name. Example: Volkswagen group produces a Car names beetle under the brand name Volkswagen and so it will be marketed as Lamborghini Gallardo. Here Volkswagen Group is the Company, Lamborghini is the brand and Gallardo is the model.In today’s world where the competition between the companies is very rigorous and the demand for vehicles is very high it is impossible for an OEM to produce a Vehicle from scratch and this is the reason for existence for many suppliers (tier1,tier 2,tier 3) which become the supply base of a company. Here we have listed some suppliers of the OEM’s and some brief information about each.Warn Industries:Warn Industries is a Tier 1 supplier that sells axel assemblies to Ford.

Whereas it can also be considered an OEM in the reference that it also sells various products like Winches directly to the common public as an accessory. It is a vehicle equipment manufacturer that provides various products for cars, military jeep, and trucks.Warn industries was founded my Arthur Warn in 1948 in Milwaukie, Oregon.

Later in 2000 he sold the company to Endeavor capital and Northwest Equity and was then acquired by Dover Corporation in 2003.The company presently has about 500 employees in a 400,000 sqft manufacturing area. It managed to get an annual revenue of $150 million in 2017 and sold around.It basically deals in1.Winches2.axle assemblies3.4WD hubsDensoDenso is a global Tier 1 automotive supplier which was a part of Toyota motors and got separated in 1949 when its named changed from Nippon denso co. ltd.

To Denso

It is based in Kariya, Aichi Prefecture, Japan.Denso has a total revenue of $43.1 billion. It consists of a total of 189 subsidiaries(2016) having 151,775 employees. It sold a consolidated 1.5 billion units in 2017.Basic products of the company are:1. Thermal Systems2. Electric Motors3. Powertrain control SystemsIt gets 50% of its revenue from making and selling Toyota brand products and has its 22% shares owned by Toyota.AutolivAutoliv has the credit of being the world largest Autoparts supplier with an annual revenue of $8 billion with 66,000 employees in 27 different countries. It was founded by Lennart Lindblad in Vargarda, Sweden, 1953 and presently has its headquarters in Stockholm, Sweden.Previously the company was known as Auto Service AB and its named was changed to Autoliv AB in 1968.

Granges Weda bought the company in 1974 and was itself acquired by Electrolux in 1989. It was finally in 1997 that the company was listed as Autoliv AB in Stockholm stock exhange.Autoliv is basically engaged with wide variety of Automotive parts that it sells to all leading Car manufacturers in the world.A few of the products are listed below 1.Airbags 3.Passive Safety Electronics 2.Seatbelts 4.Steering WheelsVisteonVisteon is an America global multinational company that was a part of Ford until 2000 after which it become an independent company that supplies products to Ford and many other companies in the area of automotive electronics.Visteon has a total of40 facilities in 18 countries with 10000 employees making a net sales worth of $3.14 billion.

Visteon has its headquarters in Van Buren Township, Michigan.Products that the company deals can be broadly classifies as:1. Automotive cockpit electronics· Infotainment units· Embedded multimedia2. Audio systems· Audio components· Connectivity3. Vehicle electronics· Powertrain control· Power control4. Controls · ADAS· DisplaysRochling GroupRochling SE & Co. KG is an insutry focused in plastics engineering employing 9700 people in 88 locations across 25 countries. It stated as a coal enterprise in Saarbrucken nd was found by Friedrich Ludwing Rochling in 1822.Presently the company is headquartered in Mannheim, Baden-Wurttemberg, Germany.

The company made an annual sales of 1.8 billion Euros in 2017.The company is dividen into three sectors, Industrial, Automotive and medical division.The company is aimed at supplies the automotive suppliers (Tier 1 suppliers) with plastic components for powertrain and aerodynamic applications. The motto of the company is to reduce the emission and fuel consumption by reducing the weight in an automobile. And this is achieved by the automotive sector by an employment of 5400 employees in 43 company locations.1. Under body panels2. Wheel Arch Liners3.

Cooling systemsIn this section of the report we will discuss with an example of how the companies that have been listed are connected to the suppliers listed.Toyota Corporation which is an OEM and sells brand under the name of Toyota is Very strongly linked to Denso Corporation, Denso is the main parts supplier of Toyota and Toyota owns about 22% of the shares of Denso and also amount to about 50% of Denso’s total revenue.Rochling Group is a Tier 2 supplier that supplies Wheel line archers, control modules through Araia to various customers namely Volkswagen, Dailmer and Ford. Rochling is not always a Tier 2 supplier. Recently it has taken a very huge order of SCR tank systems from Skoda and Volkwagen. Here we see how the Rochling group gains the position of a tier 1 supplier directly supplying required parts to the OEM’s marking a change in its customer base.Lets again discuss about the Warn Industries again.

Warn industries sets a scenario where it directly sells winches to the common people (consumer) even though it’s a Tier 1 supplier. The same consumer is also the customer of Ford to which Warn Industries supplies axle assemblies. Thus we see how the customer of a Tier1 Supplier is same as the OEM.This report already lits the Rochling Group which is both a Tier 1 and Tier 2 supplier.It previously used to supply Volkswagen, Dailmer and other customers with Wheel archers and wnder body panels through various Tier one supplier thus itself assuming the role of Tier 2 supplier.

But witht the recent order of SCR tank systems that it is directly supplying to Skoda and VW makes it a Tier 1 supplier too.However it is also possible for an OEM to be a Tier 1 supplier as we can see in the case of FORD Motor Company. Ford is an OEM producing wide varierty of cars under various brand names including Ford. However It also supplier Engines and Truck Chassis to companies like Blue Bird.

Conclusion

This Report Cleary indicates the Automotive supply chain with some examples of OEM’s, Supplier and the relation between some. The readers of this report will have some knowledge about the Varios companies their Brief history and strength of the company in terms of annual revenue, employee base

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