The Economic Impact Of Rising Oil Prices In Automotive Industry
The Economic Impact of Rising Oil Prices in Automotive Industry
The rise in the oil prices plays a major role in the automotive industry. “The world consumes over 82 million barrels of oil per day (BPD), with the united states taking roughly 20 million BPD” (McFarlane). Oil provides 97 percent of the transportation fuels that helps to run the cars, trucks and other vehicles in the nation’s highway (Heinberg). Thus, when the price of the oil rises, it clearly concerns the auto industry because the companies are competing with each other to meet the new demands for more fuel efficient consumer conscious at reduced price. There is no doubt that it is affecting the profit margin of the company. Moreover, increase oil price is also affecting the type of vehicles demanded by the customer and the way those vehicles are designed.
The demand of oil and the difficulties in oil refineries is the major cause for the increased oil price. Oil is used mainly for two purposes: Firstly,......
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