Global Automotive Supply Market: Adapt or Die
Worldwide the automotive supply sector accounted for €1.89 trillion turnover, 8.3 million jobs and an annual production of over 84 million cars and commercial vehicles in 2012*. But, as any manufacturer will tell you, figures don’t tell even half the story. It’s the ability of manufacturers to focus on opportunities and live up to challenges that does.
Since the introduction of the mass-produced Ford Model T by Henry Ford in 1908, the automotive supply sector has continued to evolve rapidly. But, this progress has not come easily and has required the OEMs (original equipment manufacturers) to be adaptable to exploit opportunities and overcome challenges. This is as true today as it has ever been. Adapt or die not only was, but is and will be a vehicle manufacturer’s strategic cornerstone.
Seven global mega trends to watch out for
So what are the important trends that will be delivering on opportunities and challenges? At LeasePlan, we’ve identified 7 trends that are set to shape the future of automotive supply:
1. Urbanisation – a call for new mobility options
As mega cities further develop and congestion and road restrictions increase, road users will look for new and potentially multiple options to remain mobile.
2. Stricter environment and safety regulations
Targets to reduce the environmental impact of industry – including automotive – will continue, with further regulation focused on safety and other user-related topics.
3. Shifting market places: increased competition
Competition will be further globalised and increasingly multi-dimensional as marketplaces become more complex.
4. Technology and connectivity
Car manufacturing processes and car specs will change significantly as new technologies continue to be introduced. Once in the car, a driver’s experience will revolve around mobile technology.
5. Supply chain integration
The need for highly cost effective and reliable supply is bound to drive mergers within the value chain.
6. Global brands
OEMs will be going global to further improve economies of scale and reach new customers.
7. e-Marketing and e-Sales
The virtual world of the Internet is set to offer more online sales, services and driver experiences throughout the vehicle lifecycle.
How do these trends impact the industry and fleets?
The below overview illustrates the possible impact of these global trends
Figure 1 Industry and fleet impact of global trends
Global Automotive Supply Trends
In this series of blogs we will be exploring and discussing these global trends and tracing their impact on the general industry and on fleet policies in more detail.
*International Organization of Motor Vehicle Manufacturers (OCIA) 2012 report