european automotive survey 2013 eng

8/10/2019 European Automotive Survey 2013 Eng

1/27

European Automotive

Survey 2013Survey results


2/27

Structure of the study

Survey of 300 companies active in the Europeanautomotive industry (15% OEMs, 85% suppliers)

Phone interviews conducted by an independentmarket research institute in January 2013(Valid Research, Bielefeld).

Country

Germany 75

France 60

Italy 30

Spain 30

United Kingdom 30

Russia 15

Austria 10

Czech Republic 10

Slovakia 10

Poland 10

Portugal 10

Hungary 10

Ernst & YoungFebruary 2013 Page 2

Peter FuPartner/German Public Auditor/German Tax AdvisorSenior Advisory Partner Automotive GSA

Ernst & Young GmbH

WirtschaftsprfungsgesellschaftMergenthalerallee 3-565760 Eschborn

Phone: + 49 (6196) 996 [email protected]


3/27

Current and future business situation


4/27

111

31

12

45

411

38

14

33

47

17

16

56

412

41

14

29

OEMs significantly more satisfied than suppliers

German automotive industry doing good business

How would you assess your current business situation?*

Europes auto industry managers are satisfied for the most part with their current business situation.

In Europe, OEMs are on average more satisfied than suppliers: 56% of OEMs are completely satisfied with theircurrent situation; the corresponding figure for suppliers is only 29%.

February 2013 Ernst & YoungPage 4

Germany Europe OEMs Suppliers

*All results in percentGood Fairly good Fairly poorMedium Poor


5/27

45

30

30

33

35

33

12

20

18

7

13

15

14

31

44

47

36

24

44

37

11

3

2

17

50

4

12

1

3

3

7

13

2

4

Germany

UK

France

Spain

Italy

Eastern Europe

Western Europe

Italys automobile industry is in a deep crisis

How would you assess your current business situation?*


Good Medium

Eastern European companiesare significantly more satisfiedwith their current businesssituation than westernEuropean companies.

In Germany, the UK andFrance respondents reportabove-average satisfaction.

The majority of companies inItaly report a poor businesssituation (63%).

*All results in percent

Respondents from European countries:

Fairly good Fairly poor Poor


6/27

Mainly optimistic projections

4

12

22

11

25

64

60

65

79

65

32

28

13

8

10

2

Italy

Spain

UK

Germany

France

How will your companys business situation develop over the next six months?

Auto industry managers in eastern Europe, France, Germany and the UK in particular look to the future withoptimism. In Italy, by contrast, every third respondent anticipates a deterioration in their own business situation.

Significantly improve Slightly improve Significantly deteriorateSlightly deteriorate

15

17

70

75

14

81

Western Europe

Eastern Europe

10

68

21

1

All respondents





7/27

43

32

18

12

16

8

7

3

40

43

45

49

34

35

35

12

13

19

31

32

41

42

39

42

4

6

5

6

9

17

16

35

1

1

8

China

India

Rest of Asia

Russia

South America

North America

Eastern Europe

Western Europe

...but a further decline in sales is expected in

western Europe

How will global passenger vehicle sales develop in the next 12 monthsin the following regions?*

Significantly increase (more than 5%) Slightly increase (up to 5%)

Slightly decrease (down no more than 5%)

Remain roughly the same

Significantly decrease (down more than 5%)

Auto industry managers expectsales to increase in Asia inparticular.

A further decrease is forecastfor western Europe. Only 15%of respondents expect salesfigures to increase.

Respondents in Germanyexpect the western Europeanmarket to decrease by 3%.



+4%

+3%

+2%

+2%

+2%

+1%

+1%

-1%

3

8



8/27

Growth only in the lowest and highest price

segments

What shor t- and medium-term prospects do you foresee for thenew passenger vehicle market?*

Stagnation Decline

Growth in small cars segment: 52% of respondents expect healthy growth rates in low-price segment.

No consensus on luxury cars segment: indeed, 34% expect strong growth in this segment, while a 29% forecaststagnation or even declining sales figures.

52

20

34

38

28

48

37

43

20

32

29

19

Low-price segment (up to EUR 15,000)

Mid-price segment (up to EUR 30,000)

Upper price segment (up to EUR 50,000)

Premium/luxury segment


Growth *All results in percent


9/27

The companies strategic and operational planning


10/27

8 7

6555

2738

15 11

5351

32 38

Despite the crisis: production capacity also to

increase in Europe

Do you expect to increase or decrease your production capacity in the coming year?*

Despite the crisis, the European companies polled intend to increase more often than reduce production capacity,not only worldwide but also in Europe.

German companies are more cautious when it comes to increasing capacity in Europe.


All respondents German companies

in Europe in Europeworldwide worldwide

Remain unchanged DecreaseIncrease *All results in percent


11/27

7

32

8

8

2

19

14

52

47

27

25

13

42

30

UK

Spanien

Deutschland

Frankreich

Italien

Osteuropa

Westeuropa

Production in Europe: OEMs are considerably more

cautious than suppliers

February 2013 Page 11 Ernst & Young

Do you expect to increase or decrease your production capacity in Europe in thecoming year?*

One in three Spanish companies intends to reduce production capacity throughout Europe in 2013 by contrast, avery small percentage of British, German and French companies intend to reduce capacity.

42% of companies plan to step up investment in eastern Europe; in western Europe, the corresponding figure isonly 30%.

15 15

6851

1734

Remain unchanged DecreaseIncrease

OEMs SuppliersRespondents from European countries:



12/27

1911

6161

2028

11 10

6760

2230

German companies intend to continue creating

jobs...

How will employment in your company develop over the next six months?

Considerably more European companies in the automobile industry intend to create jobs (28%) than to cut them(11%). In Europe, by contrast, employment is likely to stagnate at best: one in five companies intends to createjobs, and the same number plan to reduce headcount.


in Europe in Europeworldwide worldwide





13/27

25

11

11

12

37

19

17

30

25

22

17

7

26

18

Spain

UK

Germany

France

Italy

Eastern Europe

Western Europe

...but in Europe the labor market is stagnating


How will employment in your company in Europe develop in the coming year?*

Alarm signals for Italy: In Europe, only 7% of the Italian companies polled intend to create jobs; by contrast, morethan a third (37%) intend to cut jobs.

Eastern European companies are more optimistic in their HR policy than western European companies.

17 19

66 61

17 20


OEMs Suppliers




14/27

Companies opt for greater flexibil ity

Are you currently p lanning to step up one or moreof the follow ing measures aimed at raising flexibili ty?*

21

12

17

12

26

28

21

18

Are being implemented Are planned


In view of the uncertain economic development, companies are taking various measures geared to increasingflexibility and efficiency. The most common measures implemented or planned are flexible working time models(47%); external providers are also increasingly being integrated (40%).

Flexible working timemodels

(e.g. phased retirement).

Concentration ofproduction locations and

administrative units

Establishment ofShared Services Centers

Integration of externalproviders

"Implemented" and "planned"

OEMs Suppliers

Working timemodels

34 49

Integration ofexternal providers

46 39

Concentration ofproductionlocations

43 37

Shared ServicesCenter

33 29

47

40

38

30



15/27

Business models and product ranges under

scrutiny

Strategic realignment: are you currently p lanningone or more of the following measures?

33

31

27

19

17

11

39

37

33

35

31

22


In order to make themselves crisis-proof, 72% of the companies polled are reviewing whether their businessmodels are future-proof and two thirds are giving their product range a complete makeover.

Acquisitions for cost or strategic reasons are on the agenda at half of the companies.

Check whether businessmodels are future-proof

Restrict non-strategicactivities

Acquisitions in order toincrease cost synergies

Revision of product range

Strategic acquisitions

Divestments

72

68

60

54

48

33


OEMs Suppliers

Business models 68 73

Product range 74 67

Restrict non-strategic activities

50 61

Acquisitions (costsynergies)

52 55

Strategicacquisitions

46 49

Divestments 25 34

Are being implemented Are planned *All results in percent


16/27

OEMs in particular are increasingly backing

research and development

How will your companys investments in research and development develop in thecoming year?*

33

60

7

Ernst & YoungFebruary 2013 Page 16

Despite rising cost pressure, most companies do not intend to save on research.One in three intends to increase its R&D spend; only 7% intend to decrease these investments.

In Germany, the companies are more willing to invest: 40% intend to increase their R&D spend.

40

58

2

Decrease Decrease

Constant Constant

Increase Increase

Increase Decrease

OEMs 41 5

Suppliers 32 7




17/27

Focus on optimizing processes

Are you planning to increasingly st reamline processes

in the following business units?

33

30

31

29

33

30

37

38

36

38

32

28


In the coming year, the companies intend to streamline structures in procurement in particular (70%).

More than two thirds of the companies are also looking at personnel development, production and marketing inorder to increase efficiency.

Purchasing

Production

Marketing/sponsorship/events

Personnel development

Sales

Administration

70

68

67

67

65

58


OEMs Suppliers

Purchasing 68 70

Personneldevelopment

68 68

Production 68 67

Marketing/events/sponsorship

71 65

Sales 73 63

Administration 68 55

Are being implemented Are planned *All results in percent


18/27

Attractiveness of automotive sites


19/27


20/27

21

13

9

7

6

5

3

2

0

-2

-3

-3

-4

-8

-9

-11

-12

-21

South Korea

Brazil

Sweden

USA

Japan

India

China

Germany

Slovakia

Czech Republic

Hungary

Turkey

Russia

Poland

Italy

UK

Spain

France

Difference 2011-2013 in percentage points

Top countries: innovation power



21/27

2

1

4

3

3

3

5

6

7

4

6

10

13

13

19

19

28

51

17

20

22

23

23

24

27

28

29

31

34

34

35

47

42

43

44

37

Turkey

Hungary

India

Poland

Russia

Slovakia

China

Spain

Brazil

Czech Republic

Italy

France

UK

USA

South Korea

Sweden

Japan

Germany

In your opinion, how competitive are the following automotive hubs w ith respect to

product quality?*

Top countries: product quality


*All results in percent Very competitive Fairly competitive


22/27


23/27

5

5

5

6

4

5

6

8

3

5

8

6

7

11

10

8

34

40

13

13

15

16

21

23

22

21

34

35

37

45

49

46

51

54

35

31

UK

Italy

France

Sweden

Spain

USA

Japan

Germany

Russia

Turkey

South Korea

Brazil

Poland

Hungary

Slovakia

Czech Republic

India

China


manufacturing costs at present?*

Top countries: manufacturing costs




24/27

27

26

25

22

19

17

14

6

2

0

-6

-7

-10

-15

-18

-18

-19

-21

Slovakia

China

India

Czech Republic

Hungary

Poland

Brazil

South Korea

Turkey

Russia

Sweden

USA

Spain

Italy

Japan

Germany

France

UK


Top countries: manufacturing costs



25/27

3

6

4

4

4

3

5

8

11

5

8

8

12

16

25

20

21

30

23

22

25

26

27

29

31

31

29

36

36

38

38

35

36

46

45

44

Spain

Italy

Turkey

Russia

Hungary

Slovakia

Poland

UK

Sweden

Czech Republic

France

Brazil

USA

India

China

South Korea

Japan

Germany

Top countries: productivity


productivity?*




26/27

26

15

13

9

7

7

7

6

2

1

1

1

0

-2

-3

-7

-7

-15

South Korea

Brazil

India

China

Czech Republic

Japan

Germany

Poland

USA

Slovakia

Hungary

Turkey

Sweden

UK

Russia

Italy

France

Spain


Top countries: productivity



27/27

Ernst & Young

Assurance | Tax | Transactions | Advisory

About th e global Ernst & Young organ izati on

The global Ernst & Young organization is a leader in assurance, tax, transaction and advisoryservices. It makes a difference by helping its people, its clients and its wider communitiesachieve their potential. Worldwide, 167,000 people are united by shared values and anunwavering commitment to quality.

Ernst & Young refers to the global organization of member firms of Ernst & Young Global Limited (EYG).

Each EYG member firm is a separate legal entity and has no liability for another such entitys acts or omissions.Ernst & Young Global Limited, an English company limited by guarantee, does not provide services to clients.

For more information, please visit www.de.ey.com

In Germany, Ernst & Young comprises some 7,400 people at 22 locations.

In this publication, Ernst & Young and we refer to all German memberfirms of Ernst & Young Global Limited.

2013

Ernst & Young GmbH

Wirtschaftsprfungsgesellschaft

All Rights Reserved.

This publication contains information in summary form and is therefore intended for general guidance only.Although prepared with utmost care this publication is not intended to be a substitute for detailed research

or the exercise of professional judgment. Therefore no liability for correctness, completeness and/or currentness

will be assumed. It is solely the responsibility of the readers to decide whether and in what form the information

made available is relevant for their purposes. Neither Ernst & Young GmbH Wirtschaftsprfungsgesellschaft norany other member of the global Ernst & Young organization can accept any responsibility. On any specific matter,reference should be made to the appropriate advisor.

european automotive survey 2013 eng

Documents