Automotive and Suppliers

The production networks of most medium-sized companies have evolved over time. What may have been sensible and efficient years ago often no longer serves its purpose in an era of volatile demand, fluctuating customer orders, and short product life cycles. For example, if one plant is operating at full capacity while others are underutilized, alarm bells should be ringing in the executive suite. Christian Zeller and Max Stehr explain what companies can do in such situations, when certain measures make sense, and how the production footprint becomes a competitive advantage.

Large OEMs have to do it, as do medium-sized companies whose plants in one region are underutilized while customers in another market cannot be supplied quickly enough. Whether large or small, virtually all companies have to continuously adapt their production capacities to changing requirements. In a world where what seemed like an ironclad rule yesterday may no longer apply tomorrow, this is no easy task. In their article, enomyc experts Max Stehr and Christian Zeller explain what companies should pay attention to and why involving an experienced partner at an early stage can avoid a lot of unrest, friction losses, and often also costs.

Supply chain problems? This phrase is likely to remind many people of the coronavirus pandemic. Back then, it was primarily disrupted transport routes and production losses in the Far East that caused problems for German car manufacturers in particular. This time, it is the volatile situation in the supply industry. enomyc author Wolfram W. Hackbarth explains why their sandwich position is so dangerous for large suppliers and how manufacturers and large suppliers can take advantage of the wave of consolidation.

The decision is final: as of late October, the EU has imposed tariffs on Chinese electric vehicles. The reasoning? Excessive subsidies and unfair competition from China. Brussels has taken decisive action, despite strong warnings from the German automotive industry. Will the sector now face significant price increases and potential retaliatory measures from China? Could the demand for EVs be further suppressed due to these tariffs? And what impact might these measures have on Germany’s capacity for innovation? In this expert interview, we explore the scenarios currently under discussion in the German automotive and supplier industries.

German car manufacturers built a good four million cars last year. More than twice as many, namely almost ten million vehicles, rolled off the production line at foreign locations. Against the backdrop of high energy and personnel costs, but also due to increasing competitive pressure in the industry, plant and engineering relocations will continue to be an important strategic option in the future. The success of these measures stands and falls with professional planning and implementation - especially when external service providers and consultants are involved. enomyc author Wolfram Hackbarth explains what is important here.

Hydrogen is considered one of the key energy carriers in the effort to transform industry and transportation sectors to be climate-neutral. According to the German government's National Hydrogen Strategy, ten gigawatts of electrolysis capacity are expected to be built in Germany alone by 2030. This would meet one-third to one-half of the domestic demand and require an almost unprecedented scaling of current capacities. While many view this plan as completely unrealistic, enomyc author Wolfram Hackbarth sees opportunities. The industrial production of the stacks required for this is highly complex, but thanks to digitalization and Industry 4.0, it can still be economically viable—even in high-wage countries.

Relocation, reshoring, offshoring, and rebuilding: The geographical shifts of internationally producing companies resemble a busy puzzle. While BASF closes facilities at its German headquarters and invests $10 billion in constructing a mega factory off the coast of southern China, Tesla explores alternatives to production sites in China and Taiwan. Meanwhile, Stellantis plans to scale down its electric vehicle production in China, and Neura Robotics is returning to its German headquarters from China this year. The reasons for these production relocations vary by industry, from high factor costs and geopolitical risks to tariff avoidance. Moving away from Germany, where are manufacturing companies heading? Will factory relocations increase? And what are the dos and don’ts in the relocation process itself? An expert discussion with Christian Zeller and Thorsten Holl.

Material shortages, delivery stoppages, rising energy costs. Sustainability targets, digitalization and electromobility: the automotive industry is under pressure to transform like almost no other. There is no choice in this. It is compelled to transform itself, must reinvent itself, must question the tried and tested - such as network structures, contracts and sales systems - and it is doing so. New business models are entering the market. Today, we are looking at one that is not so new, but is currently being rolled out with might and main: the agency model. Much discussed, much criticized, but also accepted. Why is this? How forward-looking is it? What are its benefits? What does it entail? What are the challenges to decades-old business relationships between manufacturers and retailers? And can the agency model be profitable for manufacturers, retailers and end consumers alike? A conversation with Jan Brandt, interim manager and expert for turnaround and new business models.