Roland berger automotive_landscape_2025_20110314

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Roland berger automotive_landscape_2025_20110314

  1. 1. Copyright Jeongche YoonAutomotive landscape 2025:Opportunities and challenges aheadMarch 2011 (Short Version)
  2. 2. A. Management summary 110314_Automotive_Landscape_ 2025_Final_short.pptx 2
  3. 3. Automotive landscape 2025: trends and challenges –management summary of the key findings (1/2)Key findings of the automotive 2025 study SHIFT TO ASIA 1 There will be a dramatic shift of sales & production capacity to Asia – regional trade blocs expected to grow, leading to shift toward low-cost locations. 300,000 jobs in Europe at risk SMALL IS BEAUTIFUL 2 A/B segment with disproportionately strong growth. At the same time extremely successful low-cost cars answer the rising demand for no-frills transportation – a global phenomenon DEMOTORIZATION 3 Especially among younger people, the car loses its pole position in their emotional preferences – the motorization rate is decreasing in big cities, and by 2025 not just in mature industrial nations POWERTRAIN ELECTRIFICATION 4 In the most positive of all cases, electric vehicles will account for ~10% of new vehicle sales by 2025, hybrids will reach 40% share – internal combustion engines will still account for 50% 5 ALWAYS ONLINE, ALWAYS CONNECTED By 2025, many vehicles will be always online, sending and receiving information: Connectivity is a key factor – but intelligent traffic solutions will remain a vision well beyond 2025Source: Roland Berger 3
  4. 4. Automotive landscape 2025: trends and challenges –management summary of the key findings (2/2)Key findings of the automotive 2025 study NEW BUSINESS MODELS 6 Established players have to deal with low-cost challengers, technology challengers and the rise of new business models: mobility ecosystems incl. car sharing have to be taken seriously by 2025 LACK OF ENGINEERS & SPECIALISTS 7 Countries with aging populations are lacking in engineers & specialists, esp. when it comes to STEM subjects – OEMs/OESs cannot significantly increase their R&D departments abroad "GLO/CAL" BUSINESS ORGANIZATIONS 8 Successful global players will move away from centralized organizations: global at a local level – In 2025 these companies will have a number of regional HQs to adjust & act fast locally INDUSTRY FLEXIBILIZATION 9 The automotive industry needs to open up and be able to learn from other industries, e.g. IT, suppliers – it will be the most flexible businesses that survive10 PROLIFERATION MEETS CONSOLIDATION While the consolidation trend will continue among OESs, OEMs are likely to see a (re-) proliferation. New players, including those from outside the industry, will emergeSource: Roland Berger 4
  5. 5. B. Study design 110314_Automotive_Landscape_ 2025_Final_short.pptx 5
  6. 6. STUDY DESIGNWe conducted more than 60 expert interviews to verify themegatrends and their implicationsSelected interview partners INTERVIEW FOCUS ON IMPLICATIONS INTERVIEW FOCUS ON TRENDS OEMs (PC) Administration + think tanks • SAIC • Daimler • EU Commission • IFO Institute • BYD • BMW • Chicago Dept. • Rocky Mountain • FAW • Fiat of Energy Institute • Geely • GM • MLIT • University of Ulm • Nissan • Ford Implications • City of Tokyo • VDA • Renault • Chrysler and • City of Berlin • BMWi • PSA • Hyundai recommen- • City of Mexico • Greenpeace • Detroit Electric • KIA dations • Deutsche Bank • CATARC • Volkswagen • Merrill Lynch • World Bank OESs Third parties • Denso • TRW • Google • Facileasing • Magneti Marelli • Valeo • Auto.de • Emil Frey • Fiat Powertrain • Iochpe-Maxion • Sixt • Albert Speer • A123 Systems • Faurecia • Enel • GMP Architects • Schaeffler • Michelin • EON • Better PlaceSource: Roland Berger 6
  7. 7. STUDY DESIGNFive key megatrends will shape the automotive industry in 2025TODAY Selected Scenarios Implications for megatrends automotive industry Analyze key Identify common Verify implications and identify consequen- megatrends success factors ces for the automotive industry in 2025 Geopolitical change • Markets • Business • Employ- • Custo- models ees Demographic • Value • Business Sustainability scenario mers change chain organi-AUTO- • Products KEY High-tech scenarioMOTIVE • Partner- zation FIND- Budget scenarioINDUS- Sustainability ships • Change INGSTRY 20252010 Evolution of mobility Technological change Methodology: more than 60 expert interviews based on structured questionnaires, primary and secondary market research and analysisSource: Roland Berger 7
  8. 8. C. Implications 110314_Automotive_Landscape_ 2025_Final_short.pptx 8
  9. 9. C. SHIFT TO ASIA 110314_Automotive_Landscape_ 2025_Final_short.pptx 9
  10. 10. SHIFT TO ASIASales and production are further shifting to BRIC countries –China will be a major sales and production hub in 2025Sales and production of light vehicles by region, 2000-2025 [m units]Sales Production CAGR [%] CAGR [%] 57 69 114 2.8 57 69 114 2.8 11% 11% Other 5% 9% 8% Other 14% 6% 6% 3% 11% 15% BRI 6.7 3% 11% 14% BRI 6.8 21% 22% 31% China 12.4 32% China 12.8 80% 86% 53% 59% 44% Triad 0.4 44% Triad 0.2 2000 2010 2025 2000 2010 2025Source: Roland Berger 10
  11. 11. SHIFT TO ASIAThe shift of production capacity to growing markets and low-costcenters could affect about 300,000 European jobs until 2025Automotive-related employment in Europe 2008-2025 [m] ∆ 2008-2025 COMMENTSTotalautomotive • Employment in automotive 13.3 + 0.7 m jobsindustry 12.6 manufacturing expected to decrease by 300,000 jobs.Automotive- That equals a 9% droprelatedservices CAGR 10.1 + 1.0 m jobs • In associated industries(transport, 9.1 +0.6% (services) the employmentretail, is projected to increase byother) 1 million workplacesVehicle • The overall effect will be CAGR the creation of 700,000manu- 3.5 -0.5% 3.2 - 0.3 m jobsfacturing new posts around the automotive industry 2008 2025Source: ACEA, Prognos; AAA; VDA, Global Insight; Eurostat; Roland Berger 11
  12. 12. C. LACK OF ENGINEERS AND SPECIALISTS 110314_Automotive_Landscape_ 2025_Final_short.pptx 12
  13. 13. LACK OF ENGINEERS AND SPECIALISTSThe STEM issue: statistics indicate a growing gap of qualifiedengineers and developers in mature marketsExample – Development of engineering graduates in the US COMMENTS3,500 [000] Graduates • Despite a growing number of university graduates in the US the share of graduates in engineering fell from 8.5% in 1999 to 7.0% in3,000 2008 • Female graduates are relatively stable at about 19.0% of all engineering graduates in the US2,500 Engineering Female engineers 0 2001 2003 2005 2007 2009 2015 2025STEM: science, technology, engineering and mathematicsSource: AMROP, Roland Berger 13
  14. 14. C. SMALL IS BEAUTIFUL 110314_Automotive_Landscape_ 2025_Final_short.pptx 14
  15. 15. EVOLUTION OF MOBILITYWith the growing population and growing wealth in the BRICmarkets, the overall motorization rate will increase until 2025Cars per 1,000 inhabitants [000 vehicles]CAGR COMMENTS2000- 0.0% 0.7% 0.2% 2.6% 6.3% 0.7% 2.8%2025 • Annual growth in 808 816 triad markets between 0% and 0.7% 579 561 • Much stronger 530 542 486 growth in BRIC markets, ranging from 0.7% to 6.3% 286 annually 198 172 • 83.0% of the 144 market growth 72 43 38 expected to happen in BRIC North JPN/ Europe Russia China Brazil India markets America KOR Triad BRICSource: J.D. Power; Roland Berger 15
  16. 16. EVOLUTION OF MOBILITYA/B segment is forecast to achieve the highest growth rates of allvehicle segments by 2025Car sales index by segment [2005-2025, 2005=100] COMMENTS260 A/B Segment Reasons why A/B segments are the240 main drivers of future market growth:220 • Features: A/B vehicles already offer features typically associated with upper200 Total market segments – Example Audi A1s dual-180 clutch transmission MPV/VAN • Safety: More small cars achieve 5 stars160 C/D Segment at the NCAP crash tests – e.g. VW Polo,140 SUV/Pickup Suzuki Swift, Hyundai i20 • Driving experience: Difference in driving120 compared to upper segments diminishing E/F/Sport100 • Efficiency: A/B segment car have small engines and offer better fuel efficiency 80 • Dimensions: A/B vehicles have grown 60 in terms of size and will likely grow further 2005 2010 2015 2020 2025 (Fiat Grande Punto)Source: J.D. Power; Roland Berger 16
  17. 17. SMALL IS BEAUTIFULSmall vehicles will grow fastest across the globe – China to followsuit from 2025 onwardLight vehicles sales by segment, 2010-2025 [m units; %]Global development Example USA Example China CAGR [%] CAGR [%] CAGR [%] 69 114 3.4 14 22 3.1 15 35 5.7 10% 9% 2.7 6% 7% 6.8 22% 2.2 25% 54% 51% 3.0 58% 56% 5.4 69% 68% 3.0 36% 40% 4.1 36% 37% 5.9 10% 6.7 6% 2010 2025 2010 2025 2010 2025 Large (E/F/above) Mid-size (C/D) Small (A/B)Source: JD Power; Roland Berger 17
  18. 18. C. DEMOTORIZATION 110314_Automotive_Landscape_ 2025_Final_short.pptx 18
  19. 19. EVOLUTION OF MOBILITYA trend toward "demotorization" is developing mainly amongthe younger generation in industrial countriesExample: Japan – Ranking of interests of university students [%]Past students (now in 40s, 50s) Past students (now in 20s, 30s) Current studentsNo of interests (avg.): 5.22 No of interests (avg.): 7.09 No of interests (avg.): 8.96Rank Products/Services N=300 Rank Products/Services N=300 Rank Products/Services N=1,000 1 Fashion 35.7 1 PC 50.7 1 PC 62.1 2 Domestic travel 34.0 2 Fashion 47.7 2 Fashion 53.9 3 Dining out 32.0 3 Communication devices 39.7 3 Portable Music Players 50.6 4 Reading 31.7 4 Domestic travel 37.3 4 Communication devices 49.9 5 Music 31.3 5 Music 37.0 5 Domestic travel 44.0 6 Movies 27.7 6 Dining out 33.7 6 Music 43.7 7 Cars 27.0 7 Foreign travel 32.7 7 Reading 42.9 8 PC 25.7 8 Portable Music Players 31.0 8 Animation, Manga 42.0 9 Foreign travel 23.7 9 Reading 31.0 9 Video games 38.4 10 Audio 20.3 10 Cars 25.3 10 Dining out 37.6 11 Camera 19.7 11 Movies 25.3 11 Movies 35.5 12 TV 17.0 12 Animation, Manga 25.3 12 Camera 35.0 13 Animation, Manga 15.7 13 Video games 25.3 13 Foreign travel 33.9 14 Jewelry 15.0 14 Camera 25.0 14 TV 28.8 15 Sports goods 14.0 15 Watches 24.3 15 Licentiates, Learning 27.3 16 Cosmetics, Beauty salon 12.3 16 Cosmetics, Beauty salon 22.0 16 Cosmetics, Beauty salon 26.2 17 Watches 11.3 17 TV 18.7 17 Cars 22.8 18 Licentiates, Learning 10.3 18 Jewelry 18.3 18 Watches 22.6 19 Portable Music Players 10.0 19 Licentiates, Learning 15.0 19 Furniture, Interiors 21.7 20 Motorcycles 9.7 20 Audio 14.3 20 Jewelry 17.9Source: JAMA (Market research of personal vehicles, 2008) 19
  20. 20. EVOLUTION OF MOBILITYIn the emotional preferences of the young Germans surveyed,the car is losing its pole position vs. other mobility conceptsYouth Study: Vehicle attractiveness – Germany, 2010 (n = 50) Attractiveness COMMENTS GERMANY In the past Today In 5 years • The young people interviewed predicted a 1.0 buying a car dramatic loss in cars attractiveness as a mobility driving a car Correlation with object of desire concept in Germany • Alternative solutions to manage personal mobility are steadily strengthening their competitive position relative to the car going by bike using a car pool going by public -1.0 transportationSource: nextpractice GmbH for Roland Berger 20
  21. 21. EVOLUTION OF MOBILITYYoung people from Shanghai are expected to follow the Germansin development of preferences: Cars become less attractiveYouth Study: Vehicle attractiveness – Shanghai, 2010 (n = 50) Attractiveness COMMENTS CHINA In the past Today In 5 years • The young Chinese interviewed saw the 1.0 emotional pole position buying a car of the car still growing Correlation with object of desire driving a car in China today • However, they predicted that the cars attractive- ness as a mobility concept will soon reach a turning point going by bike using a car pool going by public transportation -1.0Source: nextpractice GmbH for Roland Berger 21
  22. 22. DEMOTORIZATIONUsage instead of ownership: car sharing & fractional ownershipas a growing model to fulfill modern mobility demandsIntegration of sustainable mobility solutions CAR SHARING • Car sharing can provide the first- & last-mile connectivity for congested urban areas until micro- Intercity mobility solutions such as electric-assist bicycles or electric two-wheelers gain mass acceptance IntercityTRAVEL DISTANCE Suburbs train • Example ZIPCAR (USA) the worlds largest car sharing service: City Car- – Founded 2000, going public 2011 sharing – 6,500 cars and 280,000+ drivers Private cars Intercity – Available in 50+ cities and 100+ universities bus – Growth by M&A (Spain, UK) Micro-mobility Public DESTINATION transportation TRAVEL DISTANCESource: Roland Berger 22
  23. 23. C. ALWAYS ONLINE, ALWAYS CONNECTED 110314_Automotive_Landscape_ 2025_Final_short.pptx 23
  24. 24. TECHNOLOGICAL CHANGEAlways online: Digitization changed the way business is done andcontinues to do so – Next step in development are cloud servicesOnline development and selected business aspectsYesterday Today TomorrowWEB 1.0 WEB 2.0 WEB 3.0 CLOUD SERVICES SOCIAL MEDIA "Mobile connectivity and open innovation" E-COMMERCE "Community building "Delivery of information and user participation" and goods" • Endlessly scalable resources (pay per use) • Suitable social media strategy and building of communities • Offer of mobile connected • Up-to-date website and shop, devices (e.g. cloud printing) • Support of marketing and sales seamless transactions activities with social media • Analysis and usage of cloud • Well presented information related data • Usage of the customer on company and goods insights gained • Good position in search enginesSource: Roland Berger 24
  25. 25. ALWAYS ONLINE, ALWAYS CONNECTEDConnectivity car-to-driver (C2D): Standardization & increasingCE integration reduces influence of traditional system playersIllustrative development of automotive consumer electronics integration So far FutureMMI Optic Haptic Voice Optic Haptic VoiceSystem Connectivity Connectivity Telematics Telematics Navigation Navigation Other CE Other CE Phone Phone Audio Audio … …Implica- • OEMs are defining MMI logic and consumer • Especially premium OEMs are still definingtions interface HMI logic and customer interface • System providers develop platform based on • Platform will be standardized, with OEMs OEM specs and are responsible for increasingly assuming integrator role integration – often including "core • Applications will even migrate out of the car applications" (e.g. navigation) – thus, also reducing value share for Tier 1 "core applications" OEM influence "System supplier" influence Other players Vehicle integrated "Decoupled"CE: Consumer Electronics MMI: Man Machine InterfaceSource: Roland Berger 25
  26. 26. ALWAYS ONLINE, ALWAYS CONNECTEDAdvancements in technology expected to create a fully intelligentand connected transportation system – But not before 2025Intelligent vehicles Intelligent infrastructure Collision notification Traveler information Commercial vehicle operations Collision warning Electronic pay system Intermodal freight Driver assistance Incident management Crash prevention and safety Auto-pilot vehicles Arterial management Roadway operations & maintenance Freeway management Roadway weather management Transit management Information systems management Emergency management systemsSource: ITSA.org, Roland Berger 26
  27. 27. C. POWERTRAIN ELECTRIFICATION 110314_Automotive_Landscape_ 2025_Final_short.pptx 27
  28. 28. POWERTRAIN ELECTRIFICATIONThe penetration of EVs and hybrids could exceed 40% in triadmarkets by 2025 – But the ICE powertrain will continue to dominatePowertrain hybridization/electrification scenario in major regions – 20251) EV EV 12% Range extenderEurope Japan/Korea 10% Range extender 8% 14% 52% ICE 17% 54% ICE Full hybrid/PHEV 11% Full hybrid/PHEV 11% 11% Mild hybrid Mild hybrid EV EV Range extender 7% Range extender 9%North China 8% 13%America Full hybrid/PHEV 10% Full hybrid/PHEV 14% 58% 6% ICE Mild hybrid 67% 8% ICE Mild hybrid1) Assumption: ICE includes micro hybrid functionalitySource: Roland Berger 28
  29. 29. C. NEW BUSINESS MODELS 110314_Automotive_Landscape_ 2025_Final_short.pptx 29
  30. 30. NEW BUSINESS MODELSThe economics of electric vehicles open up new ways forconsumers to think about and pay for mobilityBusiness modelsVehicle without battery Vehicle + energy• Option considered by some • Monthly fee includes full leading OEMs maintenance service, electricity• Battery supplied to customer and insurance via preferred partnerVehicle including battery Integrated mobility• Vehicle and battery supplied • Monthly fee includes additional by OEMs value-added services, e.g.• Battery can be sold, financed communications, parking access, or leased …Source: Roland Berger 30
  31. 31. NEW BUSINESS MODELSVolatile energy prices will provide the basis for new businessmodelsExample: Domestic power stations by green power provider Lichtblick AGElectricity market Lichtblick AG business modelHourly average market Cogeneration plant for each household COMMENTSprices 13.10.2010 Hot water • Idea: use price[EUR/MWh] to building fluctuation as90 Boilers an advantage • Lichtblick AG80 wants to install Air 100,000 domestic intake gas fired power70 Wipe pipes Exhaust plants in Germany Exhaust gas gases • Cogeneration60 Natural heat recovery – plants sell power gas fuel Catalytic heat exchanger back to the grid50 converter when the price Cold is good while water TecoDrive Electri-40 Engine heating a house- in from city to holds water building building • Cogeneration30 Generator 0 5 10 15 20 25 plants are >90% efficient TimeSource: Lichtblick AG, Roland Berger 31
  32. 32. PROLIFERATION MEETS CONSOLIDATIONEstablished players have to deal with "low-cost", "technology" &"business model" challengers – Competition will increaseOverviewBusiness model Low-cost Technologychallenger challenger challenger• RWE in Germany is considering a • Tata developed very low-priced • Successfully entered the new business model providing cars and gained fast market access passenger car market in China full customer service for EVs: in India, China etc. by offering 8 • BYD transfers own know-how – Provision of energy solutions different models from lithium-ion battery mass- – Passenger car sales with OEM • Cooperates with intern. suppliers production for mobiles to to develop low-priced components production for electric vehicles partners, e.g. BYD with fewer requirements • Advanced development status for• In this context close collaboration • Tata bought JLR to get technology EVs led to first cooperative deals with standardization organi- know-how and also access to internationally w. VW, Mercedes zations & related market players mature markets and Chinas Southern Power Grid CONCLUSIONSEstablished players have to adjust Mature OEMs have to rethink their Due to the innovation power in BRICtheir current business model to own specification requirements for nations, established OEMs have tosupport the mobility needs of the different markets and have to find & analyze the trends/developmentsend consumers with additional develop tailored solutions for the carefully and may need strategicservices/packages in future needs of the new markets locally partnerships to close own development gaps/deficitsSource: Roland Berger 32
  33. 33. C. GLO/CAL BUSINESS ORGANIZATIONS 110314_Automotive_Landscape_ 2025_Final_short.pptx 33
  34. 34. GLO/CAL BUSINESS ORGANIZATIONGlocal engineering centers – Decentralized regional engineeringfootprint balanced with global coordinationEngineering centers in the future COMMENTS • Global coordination REGION A REGION B REGION C of regional engineering centers Regional Regional Regional • Regional footprintStyle/Vehicle center center center with decentralized organization • Local designInterior Global lead specificities managed by regional centerEngine Global lead • Global/standards components definedE/E Global lead on a global base and lead by a given regionSource: Roland Berger 34
  35. 35. C. INDUSTRY FLEXIBILIZATION 110314_Automotive_Landscape_ 2025_Final_short.pptx 35
  36. 36. INDUSTRY FLEXIBILIZATIONA tale of two worlds: Automotive vs. "classic" IT applicationsAUTOMOTIVE IT INFORMATION TECHNOLOGYAPPLICATIONS APPLICATIONS OPEN OPEN • Ecosystem with many stakeholders and devices • Open development platforms CLOSED • Highly customized/customiz- • Proprietary technology; walled able; upgrade via update garden; one dedicated "device" • Fully delayered technology • Development in "closed shop" stack • Reliability/security as main design factor CLOSED • Technology stack only partly delayeredSource: Roland Berger 36
  37. 37. INDUSTRY FLEXIBILIZATIONIncreasing convergence of automotive and IT products requiresa stronger alignment of both industriesTimeline of product development processes: Automotive vs. IT MARKET COMMENTS LAUNCHAuto- Require- Prototyping/ • Challenge formotive ment testing automotive and Design IT industry to decision/ Production synchronize the Concept final specs ramp-up Growth Maturity Decline product develop- ment processes 1 2 3 4 5 6 7 8 with each other Development process (36-48 months) Lifecycle (48-84 months) • Especially with regard to electric/Mobile Require- Prototyping/ electronicsphone ment testing Growth Decline • Currently OEMs Design use the shorter decision/ Production facelift process Concept final specs ramp-up Maturity (12-24 months) 1 2 3 4 5 6 7 8 or model year process Development process (6-9 months) Lifecycle (6-24 months)Source: Roland Berger 37
  38. 38. C. PROLIFERATION MEETS CONSOLIDATION 110314_Automotive_Landscape_ 2025_Final_short.pptx 38
  39. 39. PROLIFERATION MEETS CONSOLIDATIONThe number of major OEMs has declined in the past decades – Butre-proliferation may be expectedIndustry proliferation/consolidation trends PROLIFERATION CONCENTRATION RE-PROLIFERATION 40,000 1,500 M ? 30,000 8,000 8,000 800 M 5,600 5.,00 5,000 500 500 50 30 13 23 30 50 50 M 0 1900 1950 2000 2010 2050 Number of suppliers Number of manufacturers Number of carsSource: Automobilproduktion, University of London, Roland Berger 39
  40. 40. D. Scenarios 110314_Automotive_Landscape_ 2025_Final_short.pptx 40
  41. 41. SCENARIOSHigh-tech scenario – Innovation, connectivity, technology-drivenworld HIGH-TECH WOLRD New MMI Virtual reality Importance of high- interfaces applications tech products in daily 24/7 service using voice, life – simplification of eyes, gesture, many tasks Exclusivity etc. Multiple Strong competition Customer choices connections between content Deployment of driven by brand between people and and infrastructure networking attributes between machines providers – easy to ecosystems (M2M) swap and switchImplica- Main vehicle features Brandtions for the • Connectivity (Internet on board, Web-based services) • Strong OEM brands associated withautomotive • MMI a technology mindset and exclusivityindustry • Highly personalized • Complex E/E systems: active safety, driving Marketing assistance, etc. • Strong use of CRM with customers, going beyond the product (viral marketing, community-based, etc.)Source: Roland Berger 41
  42. 42. SCENARIOSBudget scenario – Money for the basics only BUDGET WORLD Reduced purchasing Scarcity of employment due to globali- power of customers zation, increase in raw material costs Back to basics (increasing tax burden performance due to debt, inflation with low income Decline of growth, etc.) Sales via mega- traditional brands Cars become dealers, the – emergence of new unaffordable and Internet – mass brands emphasizing are a trade-off with distribution low cost (eBay, other services and Kiabi, etc.) Development products – cheapest of pay-per-use possible cars bought Little diversity – models for various maximum products standardizationImplica- Main vehicle features Brandtions for the • Low-cost cars • New low-cost brands emergeautomotive • Decontenting on power and weight, increaseindustry in E/E features Marketing • Mobility services models, emphasis on low TCO • Affordable cars from new private-label • Cars defined by customer needs (target costing) brands belonging to mega-dealers and large • Additional features as options (high level of diversity) retailers (Walmart, Decathlon, etc.)Source: Roland Berger 42
  43. 43. SCENARIOSSustainability scenario – Maximum regulation and environmentallobbying SUSTAINABLE WORLD Importance of Strict ratings for most environmental Market influence shifts to regulators products and Widespread use of legislation (CO2, services, great secondhand products noise, speed, safety, and certificates transparency and goods with long etc.) lifecycles Stricter rules on Complete mobility High taxes to support transportation (tolls, solutions, Use of low sustainability (pollution, exclusion areas, etc.) customized for consumption recycling, social consumer needs technologies, sustainability, etc.) green materials, etc.Implica- Main vehicle features Brandtions for the • Compliance with all legislation • Cars distributed through leasers, utilitiesautomotive • Differentiation by rating agencies or labeling (EVs) and insurance companies specifyingindustry • Mobility solutions focusing on TCO the model required • Rapid introduction of green cars (EVs & plug-in hybrids) Marketing • Emergence of new mobility services providers offering products and servicesSource: Roland Berger 43
  44. 44. SCENARIOSWhatever the scenario, some common key success factors willbecome crucial Budget Sustainable High-tech I II III world world world Brand Clear brand positioning and customer targets with a globalized approach Product Tailored design to specification, leveraging both high content features (eg. connected cars, ..) and low content features, greater level of customization to needs. Product & service approaches going towardKEY customer relationship and are also offering mobility solutionsSUCCESSFACTORS Opera- Glo/cal R&D approach and network, modularization, mix of more flexible tions plants and LCC plants. Capacity management driven by profitability Partners Strong relationships with well chosen partners: downstream (distribution, services providers), upstream (Tier 1), co-branding partnersSource: Roland Berger 44
  45. 45. E. Conclusion 110314_Automotive_Landscape_ 2025_Final_short.pptx 45
  46. 46. Over the coming 15 years, the automotive industry will undergothe greatest transformation it has experienced in its historyThe upcoming changes are fundamental & affect all players of the automotive industry – OEMs,suppliers, third parties, both new & established players: • A dramatic production & sales shift to the Asian markets will take place – quickly and permanently • The Asia demand supports low-cost cars as an important entry point as well as A/B segment cars in general – This segment will also grow in mature markets, where values are changing • Cars will lose their appeal for younger generations in developed countries. In major urban areas, car ownership will become unnecessary – Mobility ecosystems will provide cars on demand • The cars in question will mainly be electric – 50% will have a fully or partially electrified powertrain • Many vehicles will be permanently online via the Internet – Connectivity will be key • The automotive industry will converge with other industries – companies will engage in multiple partnerships as a way of accessing technology and customers and securing economies of scale • New business models and value chain partners will emerge, challenging the status quo, especially where they come from sectors other than the automotive industry • Players will move away from centralized organizations in the pursuit of size and access to fresh sources of engineers and other specialists – they will begin to operate glo/cally • Consolidation will continue among OESs – new OEMs are likely to emerge from different industriesThe key is for all companies to remain open & flexible – they must think & act holistically inorder to benefit from the opportunities aheadSource: Roland Berger 46

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