The 1950s were pivotal for the American automobile industry. The post-World War II era brought a wide range of new technologies to the automobile consumer and a host of problems for the independent automobile manufacturers. The industry was maturing in an era of rapid technological change; mass production and the benefits from economies of scale led to innovative designs and greater profits, but stiff competition between the automakers. By the end of the decade, the industry had reshaped itself into the Big Three and AMC, and the age of small independent automakers was over, as most of them either consolidated or went out of business.
A number of innovations were either invented or improved sufficiently to allow for mass production during the decade: air conditioning, automatic transmission, power steering, power brakes, seat belts and arguably the most influential change in automotive history, the overhead-valve V8 engine. The horsepower race had begun, laying the foundation for the muscle car era.
Automobile manufacturing became the largest industry segment in the US, and the largest ever created; the US auto industry was many times larger than the automotive industries of the rest of the world combined. By 1960, one-sixth of working Americans were employed directly or indirectly by the industry, but automation and imports eroded the need for such a large workforce within a couple of decades. The 1950s were the pinnacle of American automotive manufacturing and helped shape the United States into an economic.