By studying the behavior of the U.S. automobile industry in reference to its relationship with macroeconomics, we seek to provide an important understanding of the changes and the growth that has taken place in the industry throughout the years economically and otherwise. What are the forces that drive our economy? What are the forces driving automobile sales? Are the forces that are driving the economy and auto sales the same? By understanding the key role that macroeconomics has played in the automobile industry historically and currently, we gain a better understanding of the direction and future of the industry in relation to the future of our economy
Brief History of the Industry
The history of the automobile industry started as early as 1680 when Christian Huygens designed, but never built, an internal combustion engine that was to be fueled by gunpowder (The History of the Automobile, n.d.). The very first self-powered road vehicles were powered by steam, and by that definition Nicolas J. Cugnot of France built the first automobile in 1769 (The History of the Automobile, n.d.).
As the years went on, gas powered engines became the popular design. In 1876, Nikolaus A. Otto invented, and later patented, a successful four-stroke engine (The History of the Automobile, n.d.). Henry Ford was not the inventor of the assembly line; although his was the fist to add a conveyor belt-based system to his plant around 1913-14, thus giving way to the more affordable automobile (The History of the Automobile, n.d.).
The U.S. automotive industry is a strong and competitive industry, and is changing more than ever before. The pace of rapid innovation often creates sudden changes and future problems in an industry that seemingly continues to overcome such difficulties caused by trends in technology, the recent developments...