The impact of the cost of raw materials of

The United States of America

In the car industry and production of cars.

.Done by Saeed Mohammed and mayouf Hamad

:My Research question is

The impact the cost of raw materials on the production of cars and the automotive industry in the
?United States

The automotive industry or the car industry is one of the largest consumers of the raw materials in the
world using large amounts of materials to manufacture and produce cars, such as iron, aluminium, steel,
glass, rubber, copper, petroleum products, etc. Over the decades, new materials with different technical
characteristics have been incorporated to make more sophisticated and safer vehicles.

Firstly, the factors that effect the supply of cars are economic factors are perhaps the most crucial factor
affecting the car sales the interest rates lower interest ensure easy automobiles financing thus providing
higher sales and the higher interest rates put even less expensive and smaller vehicles out of reach.
secondly disposable and inflation lowers the worth of money. and gross domestic product GDP (gross
domestic product) has a positive correlation with vehicle sales and the higher GDP the higher the
purchase power, exchange rates and unemployment rate and the change of consumer trends or taste.

And the cost of raw materials had a big impact on the car industry, logistics costs price exploration is
hitting equipment manufacturers like never before and this unprecedented inflation is having serious
repercussions on the entire industry. The first example is the cost of an electric vehicle, which has risen by
€4500 in production compared the pandemic year to 2020.
This is because the suppliers are not trying to pass some of their costs increases to car manufacturers
but contractually, they are limited.

And the Raw material costs for (electric) vehicles more than doubled during the coronavirus pandemic
(COVID-19) year in 2020-2021 according to a new report by AlixPartners, forcing the car industry
automakers form General Motors and tesla to start up like the automaker lucid and Rivian to
significantly raise the prices on their new vehicles.
And the average costs of raw material for an EV (electric powered vehicles) is totaled around $8,255 per
vehicle as of May 2020, up to 144% increase from $3,381 per vehicle in late March of 2020, that led by
materials such as cobalt, nickel, and lithium and all essential materials to manufacture and produce the
batteries used to power the electric cars and trucks. And EV specific cost has increased to $4,500 fro,
roughly $2,000 in the past two years, according to (AlixPartners).
The cost increases aren’t limited to EVs: Raw material costs for traditional vehicles with internal
combustion engines have also more than doubled during that time to $3,662 per vehicle, up 106% from
an average of $1,779 per vehicle in March 2020. That uptick is being led by increases in steel and
aluminium.
And the cost of raw materials of manufacturing and production traditional vehicles has raised and
increased by the years for example the cost of raw materials to produce 1 traditional vehicle in 2012 was
almost $2,500 US dollars and in 2016 it had a small decrease, it was $1,500 per vehicle and meanwhile it
doubled in the years and in the year 2022 the prices boosted and when up to $4,500 per vehicle.
In conclusion in this research we discussed the impact of the raw materials on the car industry and the
production of cars and we discussed the the factors that effect the supply of cars are economic factors
and we discussed the cost of the raw materials per vehicle over the years in the research.

Bonus Question:

I need to collect data on the production of

cars in the United States over different
.periods of times to explain
The impact the cost of raw materials affects the production of cars
?and the automotive industry in the United States

 My Sources of information
 the internet (google).

 Some reports and articles.

 And I used some statistics and graph charts.

Credits:

Ortego, Abel, et al. “Assessment of Strategic Raw Materials in the Automobile

Sector.” Resources Conservation and Recycling, vol. 161, Elsevier BV, Oct. 2020, p.

104968. https://doi.org/10.1016/j.resconrec.2020.104968.

Hanley, Steve. “Raw Material Costs for EVs Doubled During COVID — Is It Biden’S
Fault?” CleanTechnica, 23 June 2022, cleantechnica.com/2022/06/23/raw-material-costs-

for-electric-cars-doubled-during-the-pandemic-and-its-all-joe-bidens-fault-or-not.