Automotive Manager I/2013

Gone are the days when a major carmaker or supplier could focus its attention on nearby markets and still be successful.

The growing importance of China and India will dramatically affect value creation in the automotive sector. Another dramatic shift is the speed of technological change. Companies that can’t keep pace or invest in the wrong solutions will pay a heavy price. The good news is that businesses that are quick to recognize growth segments and markets and are willing to adapt their value-creation strategies will be tomorrow’s champions. These are the findings of the recent study by Oliver Wyman and the German Automotive Industry Association (VDA) titled FAST 2025 — Future Automotive Industry Structure.

Suppliers will need any advantage they can get in the future. Their list of challenges includes economic uncertainty, demands from customers to support them in new markets and the need to fund research in new technologies at a time when it is harder than ever to access capital. Our study “Supplier Fitness—Crisis Avoidance in Uncertain Times” looks at solutions for these problems.

The best defense against uncertainty is having products that customers have to have, but creating those products is neither easy nor cheap. The spending trend will continue as innovation cycles get shorter and the share of electronics and software in vehicles increases. Inside this issue we look at the three steps needed to revolutionize the vehicle development system.

Automotive Manager I/2013