Germanys manufacturing sector at its fastest rate for over 1 ½ years in January, boosted by a big order intake and new hirings, suggesting domestic activity is picking up. More recently evidence is emerging that consumer demand is improving, export growth and investment are increasing. New plants include Kia, Slovakia, late 2006, Hyundai CZ mid 2008, PSA Slovakia late 2006
The Impact of Globalization on Automotive Retailers Professor Timothy K. Gilbert Northwood University West Palm Beach, Florida
We live in an amazingly complex global world, and the challenges will be likewise enormous.
The task remains – to see opportunity before your competitor capitalizes on it.
The cost of staying in the game continually rises, and some will not be able to last.
Automotive Sector Dynamics Five Global Themes Although the global assembly outlook is positive, massive structural change is occurring just below the topline, forcing OEMs and suppliers to rethink their manufacturing investment strategies. Overall growth is definitely centered on the Asia-Pacific region (driven by emerging markets + low-cost sourcing), but much fewer opportunities to gain first mover advantage as competitive pressure intensifies. Globalization 1 Automaker growth strategies are beginning to diverge as most OEMs have finite resources, forcing them to choose where to concentrate their efforts – global sector is an environment where not everyone can win . Shifting Competitive Dynamics + Big Bets 2 New vehicle types (crossovers, MAVs, etc.) are taking share from traditional vehicle segments at an alarming rate, but OEMs risk getting lost in a sea of non-distinct product offerings – market fragmentation = high marketing costs. Segmentation Shifts 4 Capacity Investment + Rationalization Traditional players are finally addressing overcapacity issues in their home markets, redeveloping manufacturing footprints to accommodate flexible assembly – but urgency for turnaround is now , not 2-3 years away. 3 Supply Chain Restructuring Private Equity activity in the parts sector kicking into high gear as more suppliers buckle under the pressure of uncompetitive business models – OEM move to consolidate suppliers also driving M&A activity going forward. Retail changes biggest in Europe with pending US consolidation on horizon. 5
As Ford readies a new version of its flagship product, it has been faced with stiff competition from: Chevrolet and its new Silverado Truck, Honda and its new Ridgeline Pickup, Nissan and its Titan Pickup, and Toyota and its Tacoma Pickup Truck, Dodge and its Ram Pickup.
Several of these products did not even exist ten years ago.