Since Cottlieb Daimler built the first small, powerful combustion engine in 1883 and Karl Benz introduced the first “motor carriage” in 1886, the European car industry has dramatically changed in various aspects. The two world wars became an impediment for the development of the market as they had been a real disaster for whole factories.
Since then, the car companies have been built again, succesfully reorganized, being merged or acquired having presented a huge progress of know-how, expanding at the same time their activities in international level.
A pivotal change in car industry’s history came in 1993. This was the year of the most remarkable decline in sales since the Second World War. However, sales have recovered since then again and nowadays most of the European car companies have adopted modern management strategies and techniques which enable them to maintain their competitive edge.
The car companies are currently focusing on improving competitiveness, trying to achieve a competitive advantage. This derives from a complicated process of cost reduction, increased productivity, enhanced quality and approach of the relevant demand from the consumers. Noteworthy is the point that the recession of 1993 became the starting point for a period in which car companies started to expand in a worldwide level.
However, the European car companies face a high competition in the European region by foreign companies. The European car market has been fully opened to Japanese car manufacturers. The expansion of European companies mainly refers to Latin America and Asia. Most of the European car companies are targeting in the markets (if have not already been activated) of these regions.
The origin features of car companies become gradually more indinstinct. For example Honda manufactures cars in Britain for the European market, using European suppliers and labor. Similarly BMW and Mercedes manufacture cars in USA. American companies present also a large-scale activity in Europe. Indicative is the fact that GM is among the top car-sellers in Europe.
Reference: Europe(periodical), (1997), Issue 363
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