snhu BUS 225 Milestone One Template Lilly Worrall Business 225 05/16/2023 Executive Summary Part One: Define Description of Problem As a sales department manager for the U.S automotive industry I have been asked to conduct preliminary research in order to diversify and bolster my companies portfolio. The main problem is our industry getting deeply impact by the COVID-19 pandemic in 2020. The pandemic accelerated the global automotive semiconductor shortage which was when 19.6 million vehicles were out of production due to the chip shortage. In February 2020, as Russia's war on Ukraine lead to gasoline price hikes, inflation impacted new and used car prices (Statista, 2023.) Overall production is low because of the low supply of parts and the chip shortage due to the COVID-19 Pandemic and other inflation problems in the U.S. In my research I will be looking at the total value of the U.S automotive industry, the sales by region, sales by fuel type, the trend in how many vehicles are being sold and made, the trends in customer demand, and the trends in body types of vehicles. Description of the Current U.S. Automotive Industry The US car manufacturing industry had total revenues of $147.5 billion in 2021, representing a compound annual growth (CAGR) of -4.7% between 2016 and 2021 (MarketLine, 2023.)The U.S auto sales have risen by 7.7% in April, 2023. The number of
cars sold in Florida in 2018 was 511,500, making it the second best performing state. There is a decline in car sales in the United States, as more people opt to buy small trucks, SUVs, and minivans instead. Overall, some 1.3 million light vehicles were sold to customers in Florida in 2018. Over 4.7 percent of California's new vehicle sales in 2018 were electric vehicles. The most common type of light vehicle in the United States is a light truck with an internal combustion engine (ICE). Gasoline ICE light trucks had an estimated market share of about 54.24 percent in 2022. However, light vehicle retail sales dropped in 2022, down to 13.75 million units. This 7.98 percent drop brought retail sales lower than the volume recorded in 2020, amid the onset of the COVID-19 pandemic (Statista, 2023.) The electric vehicle (EV) market in the United States broke records in 2021, estimated at just under 607,600 light electric vehicle sales. About 83 percent more than in 2018, which marked the beginning of Tesla's Model 3's strong demand. The US hybrid & electric cars market had total revenues of $47.9bn in 2021, representing a compound annual growth rate (CAGR) of 30.2% between 2016 and 2021 (MarketLine, 2023.)Hybrids captured 3.2% of the light vehicle market in 2013 and again 5.5% in 2021 (Bureau of Transportation Statistics, 2022.) Between April and June 2022, around 245,200 hybrid and plug-in hybrid electric vehicles were sold to customers in the United States. Current Automotive Market Trends The manufacturing of cars in 2020 was impacted amid the COVID-19 pandemic. There has been severe disruption in the export of Chinese parts