Impact of external

factors on automobile
industries
What are
Automobile
Industries?
The automotive industry comprises a wide
range of companies and organizations involved
in the design, development, manufacturing, 
marketing, and selling of motor vehicles.[1] It is
one of the world's largest economic sectors by 
revenue. The automotive industry does not
include industries dedicated to the maintenance
of automobiles following delivery to the end-
user,[citation needed] such as automobile repair shops
 and motor fuel filling stations.
The word automotive comes from the
Greek autos (self), and Latin motivus (of
motion), referring to any form of self-powered
vehicle.[clarification needed] This term, as proposed by 
Elmer Sperry[2]
 What are external factors ?
External factors are elements that influence a business' results and performance
from the outside. These factors are often part of the economic, political and social
environment of the locations where the company operates.

1) Political factors
Political factors may also include goods and services which the government wants to
provide or be provided and those that the government does not want to be provided.
Almost all of the regulations come from consumers increasing concerns for the
environment and the concern for safer automotives. For instance trade barriers and
incentives to the public to buy new cars. (Campbell, Stone house, Houston, 2007)
2) Economic factors
Economic factors include interest rates, disposable income, unemployment rates, retail
price index (inflation), gross domestic product(GDP), and exchange rates. These factors
have major impacts on how businesses operate and make decisions

3) Social factors
Social factors include the cultural aspects and include awareness, population
growth rate, age distribution, career attitudes and emphasis on safety.
Trends in social factors affect the demand for a company’s products and how
that company operates. Furthermore, companies may change various
management strategies to adapt to these social trends.
4) Technological factors
Technological factors include ecological and environmental aspects, such as
R&D activity, automation, technology incentives and the rate of
technological change. Furthermore, technological shifts can affect costs,
quality, and lead to innovation.
How External Factors Impact
Automobile Industries?
External forces are causing the automotive industry to go through a period of
accelerated change. Though high levels of internal competition drove
innovation in the past, new sources of competition have emerged and have
increasingly influenced the development and design of vehicles. Indeed, more
software is being used in autos than ever before, allowing for high-tech driving
and entertainment capabilities. For instance, vehicles are being programmed
to be more aware of their surroundings through the increased usage of backup
sensors and parking assist technology.