LRNA - Company Profile

1. Industry History & Current Overview

Since the invention of the Ford’s Model T, the modern automobile industry has been manufacturing affordable automobiles for everyone in the U.S. The age of design of cars boomed as people started to demand more customization of their cars (Model T only came black). This began the shift from manufacturing-driven automobile to a more design-driven automobile.

The Sport Utility Vehicle (SUV) emerged in the 1990s based on the negative image of the minivan, which was developed throughout the 1980s on a bland and purely functional platform. In 1996, the Ford Motor Company began building the Expedition, its new, full-sized SUV in Michigan. The Expedition was essentially the F-150 pickup truck (the best selling pick-up truck) with an extra set of doors and two more rows of seats. Ford marketed the SUV at a ticket price of thirty-six thousand dollars. The average cost to build these trucks was no more than twenty-four thousand dollar, and in the automobile industry, this is a high-profit margin. By the late 1990s, the SUV market has become the most profitable in the automobile industry.

The move toward a more aggressively styled and higher riding vehicles have caused unintended consequences and risks. The risks include decreased “drivability”, obstruction of vision, and concerns surrounding safety. Current trends in vehicle design focus on addressing these problems to achieve appealing designs with the best qualities of both cars and trucks, as seen in all the new designs from the Land Rover.

2004 will be remembered as a pivotal year in the automobile industry. It was a year in which high gasoline prices started a sea change among U.S. consumers that will finally create significant demand for fuel-efficient vehicles. Gasoline prices of $2.00+ per gallon started taking a huge bite out of family budgets, and many middle-class consumers who own fuel guzzling SUVs and pickup trucks began to wish they had vehicles that were much less expensive to operate.

Demand for hybrid cars (ie. Toyota Prius) was so high that many customers had to wait six months or longer to get there car. Other carmakers, including Ford and GM, saw the opportunity and introduced their own brand of hybrid vehicles to market. Ford launched its first hybrid: a small SUV. Other fuel-efficient vehicles, such as BMW’s MINI Cooper, also enjoyed soaring demand.

Meanwhile, sales of heavy SUVs lagged miserably, and automakers such as Chevy, Hummer and Cadillac offered unprecedented dealer incentives and rebates in an effort to move these vehicles, Land Rover Range Rover has increased due to efficient newly designed models as shown from the stats below.