Février 201218 AGEFI Luxembourg Economie/FinanceKPMG’s Global Automotive Executive Survey 2012 Global automotive players lack clear view of the future, but seem certain about electromobility and the ‘urbanized’ car by 2025 consumer-buying decisions, two-thirds ther to place more trust and resources in fuel-cell or bat-W ith China slated to be the worl- Urban mobility and the connected car don’t expect electric vehicles to tery vehicle concepts in the long-term,” commented d’s biggest market for auto exceed 15 percent of annual global Mr. Meyer. “Hybrids may be more popular in the Other issues that players striving to control the value sales and exports by 2025, sales within the next 15 years. This interim than pure, battery-powered cars, but the hid- chain should be tuning into are urbanized mobilityand demand for electric vehicles last point is clear for those living in den champion that could emerge will be fuel-cell services , ‘connected-car’ solutions and seeking newexpected to be the highest in emer- the US or in Europe” says Louis vehicles,” added Louis Thomas. alliances and partnerships to tap into innovation andging markets, global auto players Thomas (picture), head of auto- unique competencies. Urban mobility is a rapidly motive for KPMG Luxembourg. Interestingly, nearly two-thirds of respondents global- emerging issue especially in the US and Japan whereshould have a clearer vision of the “But that does not seem to be the ly said that optimization of the internal combustion over 60 percent of respondents believe urban plan-way forward on issues critical to case in China, Japan as well as engine (ICE) currently offers greater efficiency and the ning will influence vehicle design and usage. Inthe industry. But it appears they other high-growth markets where most potential for carbon emission reduction than the Germany, surprisingly, only 38 percent hold that view.don’t just yet, according to KPMG electromobility is expected to take current electromobility technologies over the next 5 Brazil is expected be a leading market for mobility ser- hold sooner,” according to the survey years. Those findings are compelling when viewed vices with 42 percent of respondents predicting moreInternational’s 13th annual Global findings. than 25 percent of the country’s urban inhabitants will alongside the survey results showing that Asian andAutomotive Executive Survey. European OEMs are most likely to gain hugely in mar- use those services by 2026; overall, China has the grea-“Compared to previous years’ results, Respondents in Asia, China and ket share over the next 5 years, with seven out of the 10 test potential to lead the market for mobility servicesthe findings this year tell us that Japan in particular, predict a with an expected 90 million potential customers. fastest growing auto manufacturers expected to be higher penetration of fully elec- from Asia. Moreover, a majority of respondents belie-auto experts have no clear idea tric vehicles than the global As younger urban drivers grow more interested in carof the direction the industry is ve that China will lead in both sales and exports of sharing than in full ownership, OEMs have an oppor- average by 2025; well over 50 vehicles by 2017 followed by the US, and Brazil in aheading,” said Mathieu percent of respondents from tunity to dominate the space but respondents from close tie for third with India. around the world had mixed views about who wouldMeyer, KPMG’s Head of China expect that upwards of 11 to 25 percent (or 4 to 9 million control this growing new mobility services market.Automotive for Europe. “One vehicles) will be new car registra- “Our survey also revealed that 75 percent believe that Full, integrated vehicle connectivity is long overduething is certain, electromobility is the mature and emerging markets are converging which said over 60 percent of survey respondents. While tra- tions for e-cars, while 46 percent of respondents will mean that the opportunities and the challenges ditionally controlled by OEMs, the very lucrative mar-most critical trend for the industry—how from Japan predict that e-car registrations will exceed will be the same for both,” said Chang Soo Lee, 25 percent. That is in contrast to the US, where nearly ket for in-car connectivity seems to be open for theand when fully-electric cars will be a reali- KPMG’s Head of Automotive for Asia and based in taking. “Given the increasing dominance of intelligentty is dependent on a variety of complex 50 percent believe new e-car registrations will account for only 6 to 10 percent by 2025. South Korea. “This has big implications for OEMs plug-in connectivity solutions, with IT companies theand interrelated factors.” from mature markets; they will have a wealth of new driving force behind them, it is doubtful that OEMs Chief among the issues manufacturers and suppliers opportunities, but they can expect fierce competition will continue to own the revenue stream down theWhile the industry continues to weigh the relative seem uncertain about is which fuel technology will from players in the BRIC countries for traditional and road,” Mr. Meyer said. “advantages of various electrified fuel technologies, it is emerge as the optimal and predominant method to new technologies in their domestic markets.”clear that ownership of the e-components space (bat- The KPMG Global Automotive Executive Survey 2012: Managing power the electric car by 2025. Globally, hybrid growth while navigating uncharted routes,tery management and chemistry, power electronics, e- vehicles are expected to lead the market and attract the Converging markets, new technology www.kpmg.com/LU/en/IssuesAndInsights/Articlespublications/Pages/motors, battery cells and packs, etc.) will draw intense most investment in the interim with full hybrids and increase growing threat of overcapacity KPMGsGlobalAutomotiveExecutiveSurvey2012.aspx, is based on a sur-competition among original equipment manufactu- plug-in versions expected to be the favored technolo- vey of 200 automotive executives, over half of whom are business unitrers (OEMs) and suppliers. Fifty-four percent of gies, and fuel-cell vehicles coming in third. This year’s As with KPMG’s 2010 global auto survey, Louis heads or higher. The respondents come from all parts of the automotiverespondents said that electric component suppliers survey found that respondents see an improvement in Thomas stresses that this year’s survey shows that value chain including vehicle manufacturers, tier 1, 2 and 3 suppliers, dea-will gain a bigger role by 2025 and 40 percent of lers as well as financial service companies and for the first time mobility battery and fuel cell technologies, and “there are signs overcapacity and excess production remain critical services providers. A total of 47.5 percent of the executives are based acrossrespondents predict that OEMs will lead in that area in that fuel cells may be viewed as the preferred option”, issues, with over half of respondents expecting China Europe, Middle East and Africa, 31 percent in the Asia-Pacific region andaddition to traditional power train technologies. said Louis Thomas. to be the most overbuilt by 2016. Yet, the survey’s fin- 21.5 percent in the Americas. Ninety-seven point five percent of the par- dings reveal that still no real solutions have been iden- ticipants represent companies with annual revenues greater than Electromobility predicted to evolve This scenario is expected to play out differently in tified. Eighty percent of respondents see overcapacity USD100 million and more than a fifth work for firms with revenues greater than USD10 billion. The respondent interviews, which were held out of Asia, but which technology? China and Japan where 33 percent and 46 percent of as a serious threat in the BRIC (Brazil, Russia, India and by phone, took place in August, September and October 2011. respondents, respectively, said that battery-electrified China) markets, confirming the available industry dataDespite the fact that 76 percent globally said that fuel vehicles will be the most popular followed by fuel-cell that indicates that unutilized capacity is a real threat in For further information, please contact: Louis Thomas, Partner,efficiency is still the most important factor affecting vehicles. “The industry faces a tough decision on whe- these regions and is rapidly increasing. Luxembourg Head of Automotive, email@example.com Culture & Economy: the marriage of the opposites? from the UKs leading business group. Even though and… fools»). The application to public subsidies crowd-funding platforms need more recognition as a N« o economic growth without cultural budgets are under constraints, a better sup- involves for CCI micro-firms owners considerable source of early stage financing, for CCI businesses art!» - This statement still scares and complex red tape, whereas the allocation of sub- supporting pre proof of concept and early market port to the purple economy might be one of the ans- people off even if artists and wers against the crisis. For instance, in Belgium, 75% sidies is considered as rather un-transparent and insi- validation. Guaranteed funds, with third party suc-leading representatives of the business of the creative entrepreneurs (micro-firms mostly) gnificant. Publicly funded support reaches only parts cess forecasting for CCI businesses, offering access tocommunity have been following new think that CCI are a high potential sector for the futu- of the sector. The CI business owners have difficulty more significant bank loans have to be reinforced. Aparadigms. And thats exactly the wed- re. However, only 51% of the Belgian CI owners belie- to access to the capital market: bank loans, venture more attractive philanthropy tax deduction for the ve that Belgium is a very good country to start a com- capital , sponsoring, crowdfunding,… Only a few individuals and companies can leverage funds fording of opposites that Kurt Salmon explo- pany in this sector. This paradox is obvious in most incentive measures are tailored to the specific needs culture in many European countries. Innovation vou-red in two studies: one of the studies was European countries. Therefore the improvement of of CCI. chers and dedicated training for CCI owners (e.g.based on the cultural investments beha- the framework conditions impacting the creative eco- Gateway2Investment training, in London, on how toviors around the world(1), whilst the other system has to be further developed. The principal hindering factors that block businesses convince investors) are inspiring schemes. in creative sectors from accessing financial resources:focused on the challenges of creative and small credit volumes for micro-firms or longer amor- Public intervention allowed a more democratic A better creative education including basics mana-cultural enterprises in Belgium(2). gerial, law and communications skills and a better co- tization periods, dependence on IP and intangible access to culture. If private support/funding is still ordination of the public action across the policies (cul- assets, difficulty of gauging future income flows and seen as evil for the liberty of the creator, public inter-Culture has changed in the last 10 years. It is not a assessing the risk of an investment, no third parties vention doesn’t prevent interventionism on the ture, tourism, education, economy, research …) arebubble anymore which stands alone. The creative valuation. The lack of a common language and loads content nor guarantee quality/avant-garde. Thanks needed. Trans-disciplinary platforms could bringeconomy, encompassing industries ranging from of clichés from both the investors side and the creati- to the tools, know how, contacts at international together the extreme diversity of creative industries. level… the private sector and citizens can also beperforming arts to videogames, is becoming global The IP protection remains a problem for the sustai- ve leaders side has proven to be an important obs-and digital. Between 2002 and 2008, Europe was the tacle. Private investors think that CCI are risky busi- partners for CCI. Regarding the growth potential of nability of those industries. The support and promo- CCI, the challenge today is not to transfer the chargebiggest player in terms of export of creative and cul- tion of the CCI abroad, especially in emerging mar- nesses or unable to honor their commitments… eventural products. In 2008, 8.5 million people were wor- though it was proven in the UK, that the survival to the private sector but to multiply the means and kets, has to be adapted to CCI and strengthened. the funding sources. Creative industries are impac-king in creative and cultural industries (CCI) and rate of CCI enterprises, after 5 years, is even higher4,5% of EU GDP. than other companies (49.7% against 46.6%). ting positively the economy. Let’s imagine the eco- Access to financing: a key challenge nomic conditions and facilities to help CCI flourish.This puts the creative industry in the same league as for companies in the purple economythe automobile industry or electrical engineering in New financial facilities to Anne MAGNUSGermany for instance. In Germany, the sector could Across Europe 85% of CI entrepreneurs have diffi- overcome the barriers of investing Culture & Public Sector, Kurt Salmongrow by an average of roughly 2.5% every year up to culties to access private or public funds. According to in cultural and creative industries 1) Kurt Salmon Study 1: “Investment and undertaking in culture:2020 with about EUR 175 bn of revenues. This gro- the Kurt Salmon survey, 76% of Belgian creative from intuition to decision-making”, presented at the Forum of Avignon,wing and innovative sector could create more jobs enterprises say that they are first and foremost finan- Now, decision-makers have a responsibility to explo- November 2011than the finance services sector with 1.3 million ced by the owners’ capital, should they be from per- re and encourage innovative funding options as a 2) Kurt Salmon Study 2: “Stakes and opportunities of cultural and crea-people by 2013 in the UK according to a recent report sonal saving accounts or «FFF» («friends, family validation of creative business models. For instance, tive enterprises in Belgium”, January 2012 Metals companies adapting new strategies to hedge against uncertainty racteristics of the segment in which they operate, their temporary, have now become fixed at those levels as expand their presence in growth economies and fur-K PMG’s report, Global Metals Outlook: Manufacturing financial strength and their tolerance for risk. demand is unlikely to justify a reversal to pre-crisis ther retrench from markets where there is less volumes in certain mature economies, at least in the medium to long-term potential. However, this is also Resilience, is a vital resource for More than one-half (51%) of metals companies sur- foreseeable future. Nearly one-third of metals com- a moment of opportunity as metals players that fine-metals stakeholders that explore the key veyed for this report see price volatility for key input panies expect to expand through M&A in the next 12- tune their business models and position themselvesissues and trends impacting the industry. costs as one of their biggest challenges over the next 24 months, compared with less than one-fifth of for the future will see their bets pay off once growthWritten in collaboration with the 12-24 months. One strategy available to metals manufacturing companies generally. Metals compa- returns to the industry.“ buyers is the use of financial instruments to hedge nies are looking to acquire self-sufficiency andEconomist Intelligence Unit, this report is exposures. As noted in the survey, this approach expand via mergers and acquisitions (M&A), fre- More than one-half (53%) of respondents from metalsbased on a survey of 220 senior executives has yet to be widely adopted across the industry not quently to gain control of raw materials. companies say their organizations are consideringfrom leading global manufacturing com- as only 21% of metals companies polled planned to localizing or customizing operations to improve thepanies. Featuring executive interviews increase their use of new classes of derivatives and Eric Damotte, KPMG’s Global Head of Metals, says efficiency of their supply chain, compared with 43%and insights from KPMG experts, the commodity hedging techniques over the next year that “Global metals companies have adapted defen- of manufacturing companies more widely. or two. sive strategies to guard against price volatility and Companies are looking to locate assets closer to cus-report sheds light on key sector trends as will continue to move towards a more self-sufficient tomers or suppliers; given the size and bulk of theirwell as the innovative strategies metals Nearly seven in ten (68%) metals producers say cost business model. Interestingly, in this move towards products, shipping costs are a major concern. Someplayers are increasingly adopting. optimization will be a top priority in the coming 12- self-supplying, some players have looked to acquire companies look mainly to secure strategic raw mate- 24 months. Keeping operational costs lean will be a a significant presence within the mining industry, rials; others are also looking to expand downstreamSubstantial commodity price volatility will be a fact of hallmark of the metals industry. Barely half (52%) of and in some cases are now considering selling their into new product segments in both developed andlife for metals manufacturers for years to come. To non-metal industry manufacturers say the same. excess raw assets on the open market. Ultimately, developing markets.manage risks and capitalize on the opportunities ari- Many of the adjustments that metals companies this is a time of restriction for the industry, wheresing from these uncertain market conditions, metals made to their production levels during the global achieving cost efficiencies remains the chief concern.companies are pursuing strategies that reflect the cha- financial crisis, which were originally thought to be Of course, metals companies look to establish or A copy of the study can be downloaded from www.kpmg.lu.