The auto manufacturing industry is changing at a fast pace, all thanks to globalization. With each passing quarter, the competition becomes more intense, sparking price wars and sometimes even leading to a soft eye on strict quality controls. The ongoing turmoil is certainly helpful for buyers who can make their regular purchase at prices never seen before, yet it is seriously eating into vendors’ profit margins.

Frost and Sullivan recently released a report reemphasizing that globalization has put extreme cost pressures on producers, forcing them to outsource low-cost manufacturing processes outside of the United States.

In addition to cost issues, another issue that manufacturers are concerned about is the strict guideline on carbon emissions. New technologies are tested every day to find something that is capable of meeting environmental policy challenges within a stipulated allocated budget.

One segment that is most concerned of all is that of the manufacturers of electric motors. Many electric motor suppliers insist that any negative drop in their profit margin could have wide-ranging repercussions across the industry. By definition, an electric motor is a device that converts electrical energy into mechanical energy. This makes them one of the most basic and most required electronic components for almost all industries, especially the automotive industry. They are mainly used in rotating machines such as fans, turbines, drills, electric car wheels, locomotives, and conveyor belts.

Electric motor suppliers believe that prices would stabilize in a quarter or two, as the price war as a strategy could not be sustained for a longer period of time.

Every story has two sides and this one is no exception either. Emerging manufacturing destination centers like India, South American countries, and China have a happy abundance problem. Too many customers want to establish their manufacturing unit abroad and some even have unrealistic expectations of their suppliers. These countries are the sure beneficiaries of the current crisis.

Trade experts say that eventually the electric motor industry will emerge strongly due to its wide use and wide reach, especially in home appliances, military equipment and industrial productions.

Industry analysts unanimously hope that electric motor suppliers can survive this highly competitive phase and emerge as profitable as before.