3rd ICAI 2024

International Conference on Automotive Industry 2024

Mladá Boleslav, Czech Republic

to Statista (2022), in 2018-2019, China had the highest amount of R&D personnel in the “Manufacture of motor vehicles, trailers and semi-trailers” industry. This article provides an in-depth examination of the financial performance of selected leading global automobile manufacturers, scrutinizing key financial indicators and their trajectories. Previous research, such as that conducted by Bhagyalakshmi and Saraswathi (2019), has underscored the importance of the operating profit margin in driving returns on equity, particularly within the realm of Indian car manufacturers. Furthermore, significant attention has been devoted to studying the operational aspects of the automotive sector. For instance, Brandenburg and Hahn (2021) investigated the evolution of firm efficiency and financial performance within automotive supply chains. Additionally, Wang, Tibo and Nguyen (2020) utilized the Malmquist productivity index to analyze the performance of the world’s top 20 automakers spanning the period from 2015 to 2018. 2. Problem Formulation and Methodology In this chapter, we first identify the companies that are the subject of analysis. The selection is based on criteria determining the size and significance of manufacturers in the automotive industry. These criteria include total revenues, the number of vehicles produced, and market capitalization. This way, we ensure that our analysis covers the most significant market players, allowing us to obtain a representative overview of the current situation in the automotive industry. The methodology of our analysis consists in evaluating the key financial indicators of the selected companies. We focus primarily on the decomposition of the return on equity and on the relative market valuation. These criteria will allow us to assess the financial performance and efficiency of the companies over time. Additionally, we examine how these companies and their future prospects are perceived through the lens of investors in the financial (capital) market. The analysis of these indicators is conducted using ratio analysis, a method that enables effective comparison of companies of different sizes and capitalizations. Thanks to this approach, it is possible to identify key differences in financial performance and uncover the factors that cause them. Therefore, the goal of our analysis is not only to provide a look at the financial performance of significant manufacturers in the automotive industry but also to enable comparison among them. The interpretation of the obtained ratio indicators, in connection with the substantial differences in applied business models, provides valuable information on how various strategic and operational decisions affect companies’ economic outcomes. This approach allows us not only to identify the leading players in the market but also to

understand the factors contributing to their success or failure. 2.1 Selection of Automobile Manufacturers for Analysis

In terms of overall vehicle sales, Toyota Motor Corporation is the largest automobile manufacturer in the world. This Japanese multinational company delivered 11.23 million vehicles worldwide in 2023, followed by Volkswagen Group (9.24 million units) and Hyundai Motor Group (7.3 million units), see Statista (2024b). In terms of revenue, Volkswagen Group is considered the top automotive company in the world

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