By Alex Cyder
The automotive industry has been the backbone of the industrial base for many national economies for more than a century. With vast numbers of employees across all stages of the production, manufacture and sale of automobiles, the health of the sector can be an accurate reflection of an entire financial infrastructure.
Knowing how the auto industry is performing and which particular companies are doing well or badly can not only help give anyone an overview of greater macro-economic trends, it can also make you a small fortune if you have money to invest in either stocks or automobiles themselves.
Just like any other major industry, shifts in consumer demand can have deep impacts on the automobile market at all levels. In recent times individual automobile brands that have long held public favor seem to have slipped against newer manufacturers for many different reasons. The emissions scandal that engulfed Volkswagen tainted the German manufacturer’s reputation for transparent efficiency, and the ever growing awareness of green issues and demand for eco-friendly products has led to an entirely new market in hybrid and alternative fuel vehicles.
Vehicle quality throughout the industry has also had effects as the mass market catches up with luxury and premium models. Consumer expectations for sophisticated infotainment systems and high-end safety features to come as standard are forcing a blurring of the lines between high-end and economy products.
Like most other stocks and shares markets, investing in the automotive industry now offers global opportunities. This means that wider issues such as international currency exchange fluctuations and ever changing trade relationships between trading blocks can influence prices and values at short notice.
Although the canny investor who knows how to forecast the market will undoubtedly be able to make a profit, there is also money to be made at the other end of the process, simply by buying cars that depreciate in value the least. For some this means look at raising finance in order to make the right purchase at the right time, so Auto Loan Solutions can be a way of making sure you can time your move to get the best possible outcome and return.
Auto industry executives and experts are currently optimistic about the North American market and forecast annualized sales in the near term of around 16 million cars. Europe is a mixed picture, with some economies still struggling to recover from the financial crisis, yet others, such as the UK are seeing record-breaking auto sales figures. Russia and South America have seen big falls in sales of up to 25%, and growth in China, which is actually the world’s largest vehicle market, has slowed as part of the country’s continuing economic problems.
With all of this information to be taken into account, no one is saying that trade in the automotive industry at all levels is an easy thing to predict, however, if you understand the basics and keep on top of changing news events and industry stories you can then use the knowledge you build up to make informed choices to your own advantage.
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