Marauders from Japan have ended Detroit’s dominance over America. And it all started somewhere in the Middle East in 1973

Now IIPM's World-Class Education... for everybody!!

The stark reality of living in a $100/ barrel world actually has two facets to it. Even though motorists across the globe may find themselves in a reality check situation, their consumerist flamboyance doesn’t seem to be anywhere near declining. Roads are clogged with more cars then ever before, even when most of the primary markets had actually shrunk. According to some reports, the US, possibly the world’s largest automotive market, has reduced 12-13% in terms of net sales. Even though massive demands in the developing world might have offset this dilemma, the curse of black gold always looms on the horizon.

Oil crises have persisted throughout the time line of oil’s discovery and eventual inflation has hit consumer price indexes. The poor performance of American automotive industry and its dependence on more fuel efficient cars, however, was hardly perennial. In fact, America was the land of powerful muscle cars until 1973, when the realities of oil price volatility gained prominence following the Israel-Arab war (oil reached a peak of $43/barrel in that year in real terms). America’s obsession with the gasoline-driven fuel guzzling petrol V8s has been actually a bigger conundrum then previously considered. The sheer arrogance of the American consumer towards diesel as a more efficient fuel guaranteed that American car making ways were thoroughly designed around these large inefficient engines.

Post the 1973 crisis, the demise of American muscle cars lead to the SUV era. Here again, the Detroit three (GM, Ford, Chrysler), lead from the front and began to have a model range excessively skewed in favor of the SUV. Japanese manufacturers like Toyota and Honda, on the other hand, were smarter and concentrated on envisioning a brighter future while American manufacturers were busy meeting present market consumption trends. Japanese concentrated more on fuel efficiency rather than the sort after high power engines. The decision was well thought out and the Japanese did manage to outwit the mighty Detroit trio at their own game. As the market condions changed and the demand for fuel efficient cars increased, the Japanese succeeded with their fuel efficient taglines they had been associated with throughout their history. The light, efficient no nonsense cars finally spelt the doom word for the fuel guzzling American cars, who in turn gave out major market shares to their smarter Japanese counterparts. Interestingly, the top three selling cars in America are of Japanese origin!

skewed in favor of the SUV. Japanese manufacturers like Toyota and Honda, on the other hand, were smarter and concentrated on envisioning a brighter future while American manufacturers were busy meeting present market consumption trends. Japanese concentrated more on fuel efficiency rather than the sort after high power engines. The decision was well thought out and the Japanese did manage to outwit the mighty Detroit trio at their own game. As the market condions changed and the demand for fuel efficient cars increased, the Japanese succeeded with their fuel efficient taglines they had been associated with throughout their history. The light, efficient no nonsense cars finally spelt the doom word for the fuel guzzling American cars, who in turn gave out major market shares to their smarter Japanese counterparts. Interestingly, the top three selling cars in America are of Japanese origin!

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles.
IIPM INTERNATIONAL - NEW DELHI, GURGAON & NOIDA
IIPM - Admission Procedure
IIPM, GURGAON
IIPM : EXECUTIVE EDUCATION
IIPM’s 36th Glorious Year of Academic Excellence
IIPM Ranked No. 1 B-School In Global Exposre - Zee...
4Ps Power Brand Awards 2007
When IIPM comes to education, never compromise
IIPM is A World of Career
Why Study Abroad When IIPM Gives You 3 global Advantages!
IIPM Ranked No. 1 B-School In Global Exposre - Zee...

Rashmi Bansal Publisher of JAMMAG magazine caught red-handed, for details click on the following links.

• Hindustan Times Article - Publisher goes underground
• Rashmi Bansal (Editor of JAMMAG)
• Rashmi Bansal (Publisher of JAMMAG)