What the future of the auto industry will look like

Detroit is in crisis. The Big Three is no more. In the wake of recession, GM’s and Chrysler’s bankruptcies, and Chrysler’s merger with Fiat, the traditional Michigan-based automakers now might better be called the Medium Two and One-Half.

Meanwhile, a new generation of auto entrepreneurs is rising, committed to building greener modes of transportation in new ways. They’re scrambling for billions in government aid intended to jump-start production of vehicles that burn little gasoline – or no gasoline at all.
Plus – and this sounds odd, given the current emptiness of US showrooms – the auto industry may be about to see its biggest growth spurt ever. Developed nations choke on traffic, but in the rest of the world hundreds of millions of consumers yearn for their first set of wheels.

Brazil, Russia, China, India, and Indonesia are among the rapidly emerging countries where per capita incomes are at or near the level at which auto ownership typically takes off. Consulting firm Booz & Company predicts the world will have 1.5 billion cars in use in 2018, up from 672 million today.

Who will produce those vehicles? What will they look like? These questions will help shape some of the industries of tomorrow, and, along with them, the economies of nations. For now, new firms such as China’s Geely and India’s Tata are now rising to challenge the founding titans of the horseless carriage.

“The global auto industry is still developing,” says Bruce Belzowski, an associate director at the University of Michigan’s Transportation Research Institute. “In five to 10 years, there could be strong competition on a global scale.”

Christian Science Monitor