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Analysis

2019 Global Automotive Supplier Study

Disruption ahead for auto suppliers

Over the past decade, uncertainty has been the rule rather than the exception for auto industry suppliers. With massive change still underway, our latest study of global automotive suppliers explores how companies can drive growth and performance as the future of mobility unfolds.

Helping global automotive suppliers navigate transformation

From the Great Recession to new mobility solutions to unexpected competition, unforeseen challenges have pushed senior leaders across the automotive and broader mobility value chain to rethink businesses entirely. As companies focus on finding innovative products and solutions with unique appeal to customers, past performance and strategies are no longer a reliable guide to future success.

In our fourth Global Automotive Supplier Study, we explore the new and rapidly changing rules of the road by analyzing shareholder value performance for more than 200 automotive suppliers. We delve into the segment analysis first introduced in our 2017 study, then present segments best positioned for growth and three strategic moves for suppliers in growing, stagnant, or declining segments. We also explore implications for automotive suppliers in each of these categories and how they might expand, defend, or pivot.

Key findings:

  • Four disruptive megatrends—shared mobility, electrification, technology convergence, and new market entrants—are driving the transformation of the automotive value chain and causing senior leaders to entirely rethink their businesses as the future of mobility takes shape.
  • Automotive suppliers have created $510 billion in shareholder value since the last recession, more than doubling the overall market value from the end of 2008.
  • Over the past three years, the financial performance of the growth segment of automotive suppliers cited in the study far outpaced other segments, OEMs, and the broader market.
  • While there is a potential 20 percent revenue erosion for the $1.7 trillion auto supplier industry, there is still  $400 billion to $500 billion in potential value creation for innovative players to capture over the next few years.
  • Suppliers driving innovation in autonomous and electrified systems will likely see the most opportunity and growth, with as much as approximately 300 percent revenue growth for some auto supplier segments.

The path forward
Despite uncertainty around what the future holds and when that future will arrive, we can be certain that the market is not waiting to find out. OEMS, suppliers, and new entrants are clearly signaling continued transformation and disruption ahead, all of which will be exacerbated by prevailing economic headwinds in markets around the world.

Ultimately, the turmoil boils down to a single, simple question: Are you prepared to help your organization navigate the massive transformation already underway and likely to last for decade to come?

Looking back
Deloitte has published its findings on the winning themes and strategic levers for auto suppliers since our first Global Automotive Supplier Study in 2013. To review past findings, explore the entire collection of Deloitte’s automotive supplier performance research below.

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