Intense research and development in the automotive industry in recent decades has triggered a dramatic change. Innovation drivers are not only electromobility, but also the increasing market maturity of self-driving cars and the ubiquitous networking of vehicles via the internet.
Car manufacturers and suppliers around the world are facing the challenge of maintaining and - ideally - expanding their market position.
Will German car manufacturers be able to maintain their position?
Whether German car manufacturers will be able to consolidate their position on the global market, however, remains to be seen. The example of electromobility shows just how unclear the situation currently is:
On the one hand, German car manufacturers appear to be making the transition to electromobility: In recent years, the share of electric cars in passenger car production has grown strongly, from four percent in May 2019 to 23 percent in July 2022. Even the Russian invasion of Ukraine has not been able to change this six-fold increase - despite the crash in production in March 2022.
On the other hand, market shifts in China illustrate how difficult German manufacturers and suppliers are still finding it, particularly with battery production: New car sales in China were 30 percent higher in July 2022 than in the previous year, but German car manufacturers have nevertheless lost market share in China. This is due to the demand for battery-powered vehicles. Chinese manufacturers and the US company Tesla have benefited from the weakness of German car manufacturers.
Companies will increasingly have to focus their strategy on the goal of strengthening their own market position. The following six aspects are key components of such a strategy:
1. Build a high-performance team.
When building your teams, I would advise the motto "fit before skills": Don't look for the best, but find the co-workers that you need in your project. A high-performance team needs attractive working conditions in order to be enthusiastic about your project - and thus drive it forward in the short term.
Which ones?
- Open communication, short decision-making paths and a flat hierarchy ensure that co-workers have more decision-making authority.
- Positive visions of the future make project success tangible and attract people with the much-cited "passion".
- Encourage creativity and the openness to break new ground.
- Show courage. Pass on responsibility.
- Through composure, so that solutions and not culprits are found.
2. Inspire your customers.
Not only measurable project goals such as schedules, cost targets or quality characteristics - in other words, everything that can be described in a specification sheet - are crucial for customer satisfaction. Your customers also expect you to contribute to product and process changes or adjustments to quantities and deadlines. Striking the right note with your customers is important and not always easy. A results-oriented culture, and therefore an increase in the willingness to engage in conflict, can be achieved if potential risks are discussed openly and clearly with all project participants at the start of the project.
You want to be unique for your customers
Then every customer should feel unique. Maintaining the customer relationship and building trust play a major role here. To do this, you need to know how your customer thinks and what is particularly important to them.
3. Deliver on your value proposition.
The "underpromise and overdeliver" mindset ensures that your value proposition is perceived and valued accordingly. If you suddenly have the attention of your customer market, your promise is "on the table" - and with it the pressure to deliver the corresponding value proposition. Only those who constantly strive for improvement here will achieve market stability in the long term.
Plan for time buffers and optimization loops. Nothing is perfect straight away:
- Employees drop out,
- Supply chains are under strain and
- Technologies and employees need training phases.
Show your reliability and you will be recommended: recommendations from satisfied customers are probably the most effective tool for expanding market share.
4. Simulate the process sequences before mechanical production.
Digital engineering, i.e. a simulation of the production processes, allows process sequences to be evaluated in a phase in which mechanical production has not yet begun. A "digital factory" enables manufacturers and suppliers
- to check the efficiency of manufacturing processes,
- the cost-effective introduction of optimizations
and therefore
- an increase in planning reliability.
5. create transparency about the project status.
Is the project on the right track? Decisions can only be made with objectively ascertainable key figures. This is why you need meaningful KPIs that make milestones visible to all decision-makers.
6. Increase sales with hidden profit.
Effective change management protects you from unplanned additional costs by highlighting customer requests that arise after the contract has been awarded (e.g. product changes). You can evaluate these expenses and invoice the customer for them. Start-up support and training for operators and maintenance staff are necessary in almost every project. But they can generate additional revenue.
Conclusion: The future of the automotive industry has already begun
Which direction the industry is taking worldwide is clear:
- cars are becoming increasingly connected,
- self-driving cars are gradually getting closer to market maturity, and
- electric mobility is the future.
But it is not yet clear which manufacturers and suppliers will remain on the market and in what form. That is why it is now important to strengthen or expand your own market position.
The key steps for this are:
- High-Performance-Team aufbauen,
- Inspire customers,
- deliver on performance promises,
- Simulate process sequences even before production in the ramp-up phase,
- create transparency and
- align change management with revenue generation.
Contact me! I would be delighted to contribute my expertise to your international projects.
