Automotive Insights 01.2013 - Roland Berger

Strategy . Supplier/OEM Relationships
4
Drive industrial investments
and reduce costs
The idea: Some vehicle components demand a high
level of capital expenditure due to production processes
that require a lot of equipment. Some OEMs do not
have sufficient volume to fully utilize the capacity of the
expensive facilities. But suppliers can concentrate their
footprint, standardize production lines and spread costs
across several customers to achieve volume effects and
reduce their industrial costs.
The example: Bumper production requires heavy presses
and paint shops. These facilities are concentrated by a
few suppliers in "technology production centers", which
generate value by utilizing available capacity and offering
logistical proximity to OEM customers.
Another appropriate example are high-volume
components such as fuel tanks. Industrial capacity and
logistics optimization are becoming even more critical
here, since most supplier plants are dedicated almost
entirely to one or two manufacturer terminal assembly
plants.
5
Assume responsibility
for parts of vehicle
diversity management
The idea: It has always been a challenge for
manufacturers to manage vehicle diversity while keeping
industrial inventory down and avoiding component
supply breakdown. Due to increasing constraints on
plant space and the inventory reduction targets of the
past few years, OEMs need more suppliers to assume
responsibility for part of diversity management.
The example: The recent development of just-in-time
plants for sub-assembly systems (such as seats, bumpers,
and chassis corners) is a clear transfer of diversity
management from the vehicle manufacturers to the
suppliers.
6
Apply joint tier 2/tier 3
purchasing strategies
The idea: Purchasing costs account for a large share
of the entire cost structure of OEMs and their tier-one
suppliers. Both can leverage synergies by rethinking
their tier 2/tier 3 purchasing systems and developing
new joint approaches.
The example: For stamping parts, suppliers are not always
big enough to negotiate steel contracts as well as OEMs
can. Schemes such as resale or "quasi resale" increase
a manufacturer's negotiating leverage while keeping
suppliers operationally in charge. By contrast, seatbelt
makers have a strong negotiating position regarding
connectors and captors. They can provide OEMs with
a clear advantage by sharing the benefits of their efficient
negotiations with tier 2/tier 3 partners.
7
Support OEMs in their
international expansion
The idea: OEM internationalization is on the way.
Worldwide vehicle platforms, global engineering and
long-distance logistics sourcing are becoming necessities.
Suppliers must keep pace with this development. They
will do so through a "glocal" approach: be global to
align products, technologies, process and organization
on a worldwide scale. Simultaneously act local by using
proximity capabilities (industrial footprint, engineering
centers, people) to define the specifics of local markets
and be more responsive.
The example: Since the turn of the millennium, BRIC
countries have become a gold mine for OEMs. All of the
major suppliers have progressively implemented their
own local capabilities to serve manufacturers, partnering
with OEMs as much as possible. Today, only a few
suppliers can accompany OEMs in introducing a global
platform and are able to serve simultaneous launches at
multiple locations.
16 Automotive Insights | 01.2013