Automotive suppliers’ struggle for survival: securing your market position

The situation of automotive suppliers is becoming increasingly dramatic. Due to Corona, sales are down by a good 30 percent. At the same time, structural change is prevailing. One in two suppliers plans to cut staff. Operational redundancies can no longer be avoided. Everyone must be prepared for high price pressure from the car manufacturers due to increasing international competition.

Securing your market position in the new structures is essential for survival. Especially owner-managed suppliers need to clarify their position. Will they still be in the market tomorrow? Do they have the financial strength to prepare for the new markets? Are there opportunities for cooperation, or perhaps prospective buyers? Smaller companies with a low equity ratio are under severe threat. So are the smaller plants of large suppliers. There will be painful consolidation.

What can you do? In any case, it is advantageous to act early and consider all strategic options. For all companies that have a positive outlook, consistent cost reduction and thus, productivity increase, is the most important tool. This is the just option when it comes to coping with increasing cost pressure and simultaneously generate capital for future investments. Only lean companies have a chance of survival. Don’t forget the indirect functions. They may reveal potentials for rationalization. Fast and flexible suppliers have advantages in every market.

ConMoto helps you to determine your position in the competition by evaluating the performance of your production with our well-tried score tests. We offer basic improvements for the implementation of immediate measures. Their effects are directly represented on our balance sheet. We make a big difference in little time – besides motivating your employees.