The US has erected its place in the global automotive market. The automotive business in the world had for many years been played by three major competitors that are based in Japan, Korea and Germany. The US intensified competition between 1987 and 2002 by product innovations e.g light weight vehicles and improving quality on existing models, Paul (2009). Consumers impulsively preferred the new model vehicles that were light with improved safety features. This led the other three major players to enhance their products with new improved innovations. This has increased competition in the global market share and profit margin.
Change in labour
Higher productivity requires additional labor. The labor productivity of vehicles and vehicle parts increased by 3.3 percent annually between 1987 and 2002. This included skilled and unskilled labor to work in various positions and at different levels of
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Vehicles with new safety features were preferred over the old models. The big three automotive companies also responded to market demands and started to develop small cars that allowed fuel injection and had their engines controlled by computer. This meant preservation of power and ability to drive with much ease was achieved. The old models were sold cheaply and companies started experiencing losses.
Relations with unions
In the US, the Union in charge of regulating the automotive industry is called AFTL-CIO . AFL-CIO focuses mainly on global trade issues. Membership to a union helps the companies protect itself from unjust treatment like unfair competition. Workers are also covered by the unions which ensure they receive fair treatment at work and are paid within the salary scale. Unions however, can affect the production and effectiveness of work. Putting unrealistic requirements to the companies has made them suffer higher cost of production.
Rules and