Global Issue of Accounting

Global issue of Accounting Minor Report
“The Effects of Globalization on the Automotive Industry”

Table of Contents
Executives summary 3
1. Introduction 4
1.1 Globalisation 4
1.2 Automotive Industry 4
2. Globalisation on the Automotive Industry 6
2.1 Globalisation of markets 6
2.2 Globalisation of production 6
2.3 Declining trade and investment barriers 7
2.4 The role of technological Change 8
3. Conclusion 10
Reference list: 11

Executives summary
This paper will talk about the effects of globalization on the automotive industry. The world economy is moving toward a world in which barriers to cross-border trade and investment are declining.   The globalisation of market refers to the merging of historically distinct and separate national markets into one huge global marketplace. Companies hope to lower their overall cost structure and improve the quality or functionality of their product offering, thereby allowing them to compete more effectively. The lowering of barriers to international trade enables firms to view the world, rather than a single country, as their market. In economic terms, the most important are probably the development of commercial jet aircraft and super-freighters and the introduction of containerisation, which simplifies transhipment form one mode of transport to another.

1. Introduction
1.1 Globalisation
A fundamental shift is occurring in the world economy which is moving away from a world in which national economies were relatively self-contained entities, isolated from each other by barriers to cross-border trade and investment; by distance, time zones, and language; and by national differences in government regulation, culture, and business system. (Kew & Stredwick, 2005, p34-5)
And the world economy is moving toward a world in which barriers to cross-border trade and investment are declining; perceived distance is shrinking due to advances in transportation and telecommunications technology;...