The rise of automotive industry has greatly affected the world’s economy. Many companies who are trying to excel despite the high level of competition have always tried to seek for an innovation to offer to the public. Most companies are offering new and latest models like 2020 kia forte orlando in order to meet the demands and to attract customers as well. Since automotive industry has played an integral part of the world’s economic rise thus it is important to better understand each effect.

  • The automotive industry contributes significant amount of tax revenues from the sales of new and used vehicles, its parts, the services, the corresponding taxes such as personal income taxes, sales taxes, value-added taxes, business taxes, and any other local taxes. Moreover, as automotive companies reap the benefits of globalization through exports, they also generate foreign exchange income. This is actually essential to a country’s current-account performance as well as its trade balance with other countries’ economies. That is why the share of automotive exports has higher percentage in developed countries rather than in emerging economies.
  • The automotive sector has played an essential role to the world’s economic development. This industry has contributed more or less 3 percent of all GDP output wherein it is even higher in emerging markets. Also, a close correlation between foreign direct investment (FDI) inflows and automotive output especially in developing countries are present. Automotive FDI also contributes a large percentage of investment in related industries which can lead to a wider development of the automotive ecosystem. Economic development has primarily affected two areas which are:
  • Industrial development Industrial clusters form an original equipment manufacturer plants which are surrounded by related manufacturing facilities such as steel plants, used car dealerships, glass manufacturers, transportation service providers, and many more. These clusters provided municipalities with a lot of infrastructure projets like solid road, railway and freight connectivity, as well as new housing developments. Almost all major automotive companies have considered these clusters essential as they are now playing an integral role in the industrial development.
  • MobilityThe main benefit automobiles have contributed to the world is the concept of mobility because people as well as cargos can now travel with ease across geographic regions. Developed countries over generations have already witnessed how the high demand of vehicle ownership and improved transport infrastructures resulted to the migration of people, businesses, and industry from cities to newly developed suburban areas. This trend is also spreading to emerging economies that gives crucial revenue sources for their respective states.
  • The invention of motor vehicles have affected the ways of how people live recently. Based in world average, there is one motor vehicle for every five people. Automobiles have increased greatly the quality of life due to its mobility, comfort, and safety. The automotive industry has also contributed a lot especially to job creation and skill development. Its numerous forward and backward links created both direct and indirect employment that helped many people in every state.