Declining Industry

DEFINITION of 'Declining Industry'

An industry where growth is either negative or is not growing at the broader rate of economic growth. There are many reasons for a declining industry: consumer demand may be steadily evaporating, the depletion of a natural resource may be occurring, or there may be the emergent substitutes because of technological innovation.

Declining Industry

BREAKING DOWN 'Declining Industry'

An example of a declining industry is the railroad industry, which has experienced decreased demand - largely due to newer and faster means of transporting goods (primarily air transport and trucking) - and has failed to remain competitive in pricing, at least in relation to the benefits of faster and more efficient transport provided by airlines and trucking services.

RELATED TERMS
  1. Transportation Sector

    A category of stocks relating to the transportation of goods ...
  2. Growth Industry

    A sector of the economy experiencing a higher-than-average growth ...
  3. Emerging Industry

    A group of companies in a line of business formed around a new ...
  4. Transportation Bond

    Fixed-income obligations of issuers that own and operate transportation ...
  5. Substitute

    A product or service that a consumer sees as comparable. If prices ...
  6. Depletion

    An accrual accounting method that companies use to allocate the ...
Related Articles
  1. Markets

    Great Company Or Growing Industry?

    Look at the big picture when choosing a company - what you see may really be a stage in its industry's growth.
  2. Markets

    Is This The Next Big Play For Growth Investors?

    Read about how the railroads sector might perform for growth investors, and why the cyclical nature of railroads makes room for future opportunity.
  3. Markets

    Explaining Industry

    The term industry refers to a classification of companies that share similar business activities.
  4. ETFs & Mutual Funds

    Top 4 Transportation Mutual Funds

    Discover the top-rated mutual funds in the transportation industry, and understand how investors can position these funds in their asset allocation.
  5. Trading

    Global Transportation: Exploring Revenue Trends and Fundamentals

    Explore the geographic trends in global transportation sector revenues, and discover the factors that influence revenue contribution and growth in this area.
  6. Markets

    DJIA vs. Dow Transport: A Telling Divergence?

    The Dow Transport Index and the Dow Jones Industrial Average are sending mixed signals. What does it mean?
  7. Markets

    Global Transportation: 3 Key Industry Players (BRK-A, AAL)

    Get information on some of the leading publicly-traded companies worldwide that are major players in the transportation industry.
  8. Markets

    Industrials Sector: Industries Snapshot (XLI, BA)

    Discover the 12 industries that comprise the industrials sector of the Standard and Poor's 500 Index, and learn which key companies could help your portfolio.
  9. Markets

    Understanding the Substitution Effect

    The substitution effect is an economic term used to describe consumer behavior relative to price or income changes.
  10. Markets

    Industries That Will Never Go Away

    A list of industries that will not perish anytime soon, as they provide and feed our basic needs.
RELATED FAQS
  1. Why should I invest in the railroads sector?

    Reap the benefits of the railroad sector's advantages over its competitors by adding companies in this industry to your investment ... Read Answer >>
  2. How does the risk of investing in the industrial sector compare to the broader market?

    Discover how the risk of investing in the industrial sector compares to the broader market. The industrial sector is highly ... Read Answer >>
  3. What are the most popular mutual funds that give exposure to the railroads sector?

    Investing in sector-specific mutual funds, such as transportation funds that include railroad company stock, can be a smart ... Read Answer >>
  4. What are the most popular mutual funds that invest in the automotive sector?

    Discover some of the mutual funds that investors consider utilizing to profit from gains in the automotive industry portion ... Read Answer >>
  5. Should a small business test the substitution effect on its products before launch?

    Explore the substitution effect and find out how small businesses may evaluate how this principle impacts their own products. ... Read Answer >>
  6. What developed countries have the largest proportion of industrial companies?

    Examine the industrial sector in developed countries, and learn about the shift in manufacturing production to emerging market ... Read Answer >>
Hot Definitions
  1. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  2. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  3. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  4. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  5. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
  6. Weighted Average Life - WAL

    The average number of years for which each dollar of unpaid principal on a loan or mortgage remains outstanding. Once calculated, ...
Trading Center