... Cost reduction: Increasing competition in the industry has intensified the quest for cost reduction among automobile manufacturers. * World-wide outsourcing * JIT or just in time scheduling has radically reduced the level of inventory and the work in progress. * Component production and some assembly activities have been shifted to lower cost locations. * In high cost locations, increased automation has reduced labor input. The quest for economies of scale and scope in relation to product development meant that companies sought to spread rising development costs over larger production and ales volume. The desire to achieve the above also has resulted in standardization of designs and models of each manufacturer. To top all this, European car manufacturers are under the influence of inflexible cost structure and high overheads which reduce producers' abilities to cope with demand fluctuations. Hence there is a conflict between technological advancement and reduction of cost. All the companies have to ...

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