We’ve been talking about the challenges and changes that the automotive industry is facing for a long time, but if we’ve seen anything over the past three years, it’s the speed at which they’re happening. The impact of the new system, changes in its production and business models, new consumption patterns of its customers and a strict energy transition roadmap set by the European Union.
Despite facing one of the biggest and most turbulent transformations in its history, and in a context of macroeconomic uncertainty, the sector shows some hope for the future. This is evident from the opinions of more than 900 industry executives collected in a global survey that we have prepared, in which 80% of European managers express a positive outlook on business profits in the medium term, almost twice as much as a year ago. Confidence is based, above all, on the perception of Covid-19 and the shortage of semiconductors and other raw materials will be gradually alleviated, especially since they are confident that they will lead a new mobility industry. is formed in the ecosystem that surrounds the automotive industry, with new business models that arise from the digitization and electrification processes of the sector, which they hope will bring benefits in the years to come.
In this sense, energy, technology, insurance companies or start-up networks weave together with the automotive industry, using new market cells. For this reason, almost half of the European motor pool is an advocate of the formation of companies to seize opportunities and trust that monthly subscription models will become a differentiating element compared to their competitors and their incomes. We must not forget that the big technology companies are gaining prominence, and more than half of the car executives predict that they will enter this market with their own brand of vehicles.
And not just coaching pain. Last year we saw a boom in new electric vehicle manufacturers outside of the big OEMs (original equipment manufacturers), but with the necessary financing to produce at scale, such as Taiwanese Foxconn, which collects and is already working on mobile phones. To produce electric vehicles for the American company Lordstown Motors.
This rise of new manufacturers is driving significant changes in consumer tastes, especially in terms of performance and brand. When executives are asked what will be most important in their purchasing decisions over the next five years, 80% are still focused on performance. But branding and image are beginning to be seen as a key differentiator, up six points from last year, and where new entrants to the market could have a competitive advantage simply because of brand authority.
A simple example: When asked which of the following companies are expected to be market leaders in electric vehicles in 2030, Apple ranks fourth, despite not producing, or even now announcing, the production of electric vehicles!
Although the future looks good for this industry, a major caution is observed in the short term. More than half of state executives are concerned about the breakdown of supply chains, high-cost energy, supply and volatile prices of raw materials and semiconductors, rise in interest rates or high-cost inflation, which negatively affect. its results this year.
Faced with these risks, the sector wants to exercise greater control over its supply chain by accumulating inventory, relocating production or through direct investment and new joint ventures with suppliers.
The growing intention of the sector to remove non-strategic parts of the business is also observed: one in five executive states is responsible for corporate merger operations and helps companies accelerate the transformation process.
At the European level, one of the fundamental challenges facing the industry is compliance with environmental regulations, much more ambitious in terms of deaths than in other geographies, which translate into investments in the entire industry of more than 450,000 million dollars, to which they intend to respond. on the part of the Brussels calendar supplement.
However, the slowness with which the charging infrastructure is developed and the expectation of a longer time to equal funding with internal combustion vehicles, negatively affect the expectations of sales of electric vehicles, and reduce to 24% the expected participation in the European market. 2030, half of what was predicted a year ago.
In this very context, the sector pays attention to the new figure of Perte VEC II. Not without reason. We support the continuity of an industry as important in Spain as the automotive industry.
Begoña Cristeto He is the partner responsible for the automotive, industrial and economic sector at KPMG in Spain
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