Zacks Equity Research issues a report today shows the
reinvention of the auto industry continues
“The auto industry is highly concentrated. The top-10 global
automakers account for roughly 80% of the worldwide production and nearly 90%
of total vehicles sold in the U.S.
In January-May 2012, General Motors Company (NYSE: GM) led
with a 17.8% market share in the U.S., followed by Ford Motor Co. (NYSE: F)
with a 15.6% market share, Toyota Motor Corp. (NYSE: TM) with a 14.5% market
share, Chrysler-Fiat with a 11.5% market share, and Honda Motor Co. (NYSE: HMC)
and Nissan Motor Co. (OTC: NSANY) at the last spots with 9.6% and 8.1% market
shares, respectively.
Due to a massive structural change after the global economic
meltdown in 2008, the global auto industry is expected to be ruled by
automakers and suppliers based in the six major auto markets: China, India,
Japan, Korea, Western Europe and the U.S.
Green Cars
Rising fuel prices and global warming have turned attention
to the auto industry that either rely less on traditional fossil fuels or use
cheaper renewable sources of energy. Thus, "green" alternatives such
as fuel-efficient electric vehicles (EVs) and hybrid vehicles will attract
consumers in affluent countries while flex-fuels such as ethanol and natural
gas will be highly demanded in the emerging auto markets due to their
suitability with the local climate and resource base.
Consequently, there will be a variety of powertrain
technologies in the auto industry in this decade and "green" cars are
likely to represent about 30% of total global sales in developed auto markets.
Globally, the hybrid market is ruled by Toyota (which
includes the popular Prius) and Honda (includes Civic and Insight hybrids).
Meanwhile, other automakers such as Ford, General Motors and Nissan are also
aggressively pursuing a plan to push hybrid sales. Some of their
"green" cars have already generated huge responses in the auto
industry, including the Ford Focus, GM Volt, Nissan Leaf, among others.
In late 2011, Ford and Toyota have signed a memorandum of
understanding on the equal product development collaboration in order to
develop a gas-electric hybrid engine for pickup trucks and sports utility
vehicles (SUVs). The automakers have decided to sign a definitive agreement
that would lay out timelines to develop the technology. They expect to market
the product by the end of this decade. The development of electric hybrid
engines would help both the companies meet stringent fuel economy and pollution
standards in the U.S. and elsewhere in the near future.
GM also plans to manufacture a luxury electric car dubbed
ELR based on the technology used in its Volt plug-in hybrid for its Cadillac
brand as a part of its long-term goal to become a leader in the fuel-efficient
vehicles market.
U.S. is the largest hybrid car market in the world, with
sales accounting for 60%-70% of global hybrid sales. According to J.D. Power
and Associates, hybrid-electric vehicle sales volumes in the country are
expected to grow by 268% between 2005 and 2012.
Presently, there are only 12 hybrid models available in the
U.S., which would increase to 52 by 2012. Didier Leroy, head of Toyota's
European operations, has revealed that the percentage of consumers in Europe
interested in hybrid cars for their next car purchase has increased to 16% in
2011 from 8%-9% in 2009.”
The full article can be read at
Last Chance Mile: The
Reinvention of Manufacturing by Rod Kackley is scheduled for release in
early July.
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