Tension in the Automotive Value Chain

An end to the arbitrariness in the supplier relations

Competitors form Asia, EU regulations on the Co2 emission and the development of climate considerate drive: The enormous innovation and cost pressure of the resent technological change weights heavy on the relation between OEMS and suppliers. On 29.September 2010 at the 3. FACTON Congress “Tension in the Automotive Value Chain” renowned representatives of OEMS and suppliers came together in “Schloss Bensberg” to figure out new ways of cooperation.



“The corset for the cooperation between OEMS and suppliers becomes tighter”, was the resume of Engelbert Wimmer, Member of the Board of PA Consulting Group. To realize the drive of the future solid cost efforts are needed. As a result the cost pressure on the suppliers grows. Not only the development of new drive technologies but also the improvement of conventional drives give rise to the automotive costs dramatically and with that the cost pressure increases as well.

To position oneself in this area of tension suppliers need to differentiate themselves form the competitors via innovations. But how can this innovation power be financed? Dr. Marcus Klopp, Head of Advance Development at Borse Fahrzeugteile Gmbh & Co. KG names besides the enhanced shares in costs on the ongoing profits, the cooperative development with OEMs and third party contracts as a solution. For a fast and cost effective entrance in new business fields Brose relies on the driving force of core competence based innovations. “Especially in the field of innovation suppliers need to control their costs”, Klopp emphasized. Further more well founded expertize and an ongoing verification on current and future trends is indispensable.

Likewise in the character of sustainable trends was the speech by Prof. Dr. Kampker from the RTWH Aachen. By looking at the project “StreetScooter” Kampker explained the requirements for a production of electric vehicles that are ready for a commercial series production and competitive. “In established structures electric vehicles can not be produced economically and in line with the market”, Kampker stated. To use the potentials of the new drive a totally new vehicle concept is needed. The solution: a ridged modular structure of the StreetScooter and a development of quasi-standards through an industrial modular system.

Not only production processes, but also corporate culture must be developed further to assure to meet the market requirements. How an active change management can look like, was explained by Dr. WIllibert Schleuter, the former Head of Development Electric/Electronic at Audi AG. After Audi landed on the last place in the J. D. Power Error Statistics in 1996 Schleuter made radical changes in the management culture. His success-factors: creative riot, conflict ability and short communication channels – but especially a high degree of autonomy. “You have to provide the employees with a vision”, Schleuter requested.

Globalization, population growth and a sustainable change in the social internal structure shape the mobility of the 21.Century Dieter Althaus, Prime Minster off duty and Vice President Corporate Marketing & Sales VW at Magna called suppliers and OEMs for using the changes as a chance. For the suppliers this means to see oneself enhanced as a developer and showing a greater willingness to follow the OEMs on their way in the globalization.

Also clear statements came form Rainer Schmückle, longtime COO at Mercedes Benz Cars, who said that the arbitrariness in the supplier relations must come to an end. More calculability and trust must be basis for a long-term cooperation in the future. “On behalf of the increasing international competition the European OEMs and suppliers build a community of fate towards the Asian competitors”, Schmückle forecasted. “An absolutely perfect cooperation between OEMs and suppliers can be the most valuable asset in this rivalry.”.