From Traverse City to Success
Management Briefing Seminars
2007
From Traverse City to Success Supplier Strategies and Tactics from MBS 2007
Mike Robinet Vice President Global Vehicle Forecasts CSM Worldwide
GLOBAL LIGHT VEHICLE SALES Emphasis on New Markets 25
10%
2007-13 Grth
100%
ME/Af, 3%
2007 20
2.1
8%
2007-13 CAGR% (R-axis)
80%
15
6% China, 27%
40%
CE EU, 11%
3.4
16.8
2.9
1.4 0.9
4.2
0.3 1.8
ME/Africa
4.5
South Asia
S America
Japan/Korea
W Europe
3.4
S Am, 7% Jap/Kor,
2%
6.9
C/E Europe
6.6
Gtr China
5
0
60%
4%
19.0
N America
Millions
1.5
10
S Asia, 23%
20%
0%
W EU, 12%
1%
N Am, 17%
0%
Contribution to Growth 20072013 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Global Light Vehicle Production by Region A 3.7% C
90 C 4.5%
80 70
0.7% CAGR
60 Millions
C 3.8%
2.9% C
AGR
Region (2007-10, 2010-13 CAGR%)
GR A GR
South As ia (17.2%, 6.2%)
A GR
Gre ate r China (12.2%, 5.2%) C/E Europe (9.2%, 4.2%)
50 South Am e rica (7.3%, 5.0%)
40 30
M E/Africa (3.7%, 4.9%)
20
North Am e rica (0.7%, 2.5%)
10
W. Europe (0.4%, 1.6%) 2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
0
Japan/Kore a (1.9%,-0.7%)
•Global production growth rate slows but continues an emerging market focus
•Growth of South Asia eclipses that of Greater China after 2007
•Developed markets of NAFTA, W Europe and Japan/Korea essentially flat
•South America rises on domestic demand 2007 © CSM Worldwide 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS Global Production By Global Segment
2002 1997
7.3 6.3 2.5% 5.7 5.6
E
CAGR % 2007-2013
Share of Growth
-0.4%
2007-13 Growth (Mil)
FF
2013 2007
Global Segment
10.0 10.3 10.6 9.9
FF
-0.3
-2%
E
1.0
7%
D
3.3
23%
C
4.2
29%
B
4.4
30%
A
1.9
13%
16.5 13.1
D
3.8%
10.6 10.5
22.5 C
13.9
18.3 3.5%
12.5 17.5 B
10.1 9.5
13.0 5.0%
8.1 6.2
A
4.9 4.1 0
5
4.5% 10
15
20
25
Millions 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Growth of the Asian 4 by Sales Parent 20%
16% 14% 12% 10% 8% 6% 4% 2%
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
0% 1997
Global Production Share By Sales Parent %
18%
2007 © CSM Worldwide
GLOBAL PRODUCTION PECKING ORDER Production Follows Sales Growth 1997
2013
1
US
Japan
2
Japan
US
3
Germany
China
4
S. Korea
Germany
5
France
India
6
Canada
S. Korea
7
Spain
Brazil
8
UK
France
9
Brazil
Canada
10
Italy
Mexico
11
Mexico
Spain
12
Belgium
Russia
13
Russia
UK
14
China
Thailand
15
India
Iran
Virtually Tied at 11 Mil
•Growth several emerging market locations predicated on strong domestic and export demand •Export-focused locations (Thailand, Japan, Korea, Mexico) trust upon open markets without NTB (non-tariff barriers) for volume growth/stability •Shift away from established locations difficult due to political, union, investment and ‘home country’ realities •Greater spatial positioning of future investments due to incentives, access to markets and demand diversification
2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS 59% (+6pts)
Suzuki Fiat
Global Developing Markets Share = 45% in 2013
59% (+11pts)
PSA
(+10pts from 2007)
40% (+10pts) 32% (+10pts)
Honda
48% (+17pts)
Hyundai
52% (0pt)
VW Ford
35% (+12pts)
Ren/Niss
44% (+7pts)
Central Europe Eastern Europe Andean Mercosul Mexico ASEAN China India Middle East South Africa Taiwan
Developing Markets
Major OEM Players by Type of Market - 2013
40% (+11pts)
GM
33% (+13pts)
Toyota 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Units in Millions 2007 © CSM Worldwide
BRICS PRODUCTION
Major OEM Players 2002 vs. 2007 vs. 2013 Asian 4 and upstart OEMs have the strongest BRICs growth rates
Millions
2.0 1.8 1.6 1.4 1.2 2013
1.0
2007
0.8
0.4 0.2
2002
0.6
Fi at
on da H
Ta ta
he ry C
Su zu ki
Fo rd
en /N is R
yu nd ai H
To yo ta
G M
VW
0.0
2007 © CSM Worldwide
GLOBAL STRUCTURAL SHIFTS An Expanded Perspective
• Sales Growth Drives Production Expansion Currency stabilization is key Increase in Developing Markets for both export and domestic BRICs already global on several levels Others look to lower cost locations (Asia, C/E Europe) for expansion
• Segment Shifts Towards B, C & D Development of B, C and D squarely in Asia and Europe – North America not part of the mix
Asian OEMs Localize, Upstart OEMs Expand, Others Restructure Each OEM has a strategic expansion path, partners and JVs emerge Driven by several factors: costs, new markets, market access
2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less is More Shifting Balance of Power Adjusting The Lens
2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Global Light Vehicle Production Capacity by Region Region (2007-13 CAGR%)
2.4% CAGR
100
85%
90 80
Millions
70
84%
ME/Africa (2.5%)
83%
South Am erica (3.2%) South Asia (7.4%)
60
82%
50
81%
40
80%
NA (-0.3%)
79%
Europe (2.2%)
10
78%
Utilization
0
77%
30
Japan/Korea (0.6%)
2013
2012
2011
2010
2009
2008
2007
2006
20
Greater China (5.5%)
• Global platforms allow greater plant-level flexibility and thus higher
utilization rates • Low/nil capacity growth in W Europe, NA & Japan • Growth in Developing Markets as low-cost surge continues
2007 © CSM Worldwide
LESS IS MORE
153
140
185
130
180
120
114
100 90 80
2005
110
Platforms Over 50K
190
2013
150
175 170 165 160
Platforms over 50K/Year 192
168
2013
195
2005
Volume Per Plant
160
2007
Volume/Plant
Thousands
Increased Scale Affects Plants and Platforms
155 2007 © CSM Worldwide
LESS IS MORE
Top 10 Platforms By Volume 2007 vs. 2013 0
(Mil)
1
2
4
(Mil)
0
1.5
R/N - B
Toyota - MC-M
1.5
Ford - C1
Ford - C1
1.5
Fiat Type 199
Honda - C-5
1.5
R/N - C
1.2
21% of Total 2007 Volume
1.2
Ford - B2
1.1
Primary Development Origin
GM - GMT900
1.0
Asia
Toyota - 330N
1.0
2013
VW PQ35/PQ36
VW PQ24/PQ25
1
2
3
Toyota - MCM
1.8
R/N - B
2007
3
North America
3.7 3.2 2.3 2.1
VW PQ35/PQ36
2.0
Toyota - MCC
2.0
R/N - C
2.0
Suzuki YN B
1.9
GM DELTA(2)
1.9
Europe Honda - C-5
4
27% of Total 2013 Volume
1.9 2007 © CSM Worldwide
GLOBAL RATIONALIZATION Less Is More
• Fewer Platforms … More Options • Enhanced intra-platform flexibility driving more bodystyles • ‘Classic’ strategy (carryover of older structures) is waning
• Emergence of Market-Specific Efforts • Low cost platforms – Tata, Ren/Nis, Toyota, GM • Developing Markets – Toyota IMV, Mitsubishi CR
• Pressure on Older, Developed Market Facilities • Easier market access from emerging locations offers competition • Remaining facilities more flexible and efficient
2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less is More Shifting Balance of Power Adjusting The Lens
2007 © CSM Worldwide
SEGMENT FOOTPRINT ANALYSIS
Production Share By Global Segment - 2013 A
40% 35% 30% 25% FF Europe Japan/Korea Greater China
B
20% 15%
• Europe and Japan/Korea focused on B- and Csegments, due to domestic market requirements and historical abilities • Fewer space considerations and lower fuel costs drive North America toward C, D, E and Full-Frame
10% 5% 0%
North America E
C
D
• Regions with a ‘segment’ footprint which varies greatly from the global average must specialize to drive exports 2007 © CSM Worldwide
SHIFTING BALANCE OF POWER
Global Production By OEM Home Region North America
Asia
North America
Asia
25% 33% 39%
2013
1997
49%
26% 28%
Europe Europe
2007 © CSM Worldwide
GLOBAL PRIMARY VEHICLE DEVELOPMENT •Vehicle Structure, Chassis & Engine Box •Build Process •Powertrain/Steering Protection •Safety, Seating Structure & Electronics R
25 20
30
. 9% +4
G CA
NA 8%
25
32
30
% +2.9
R CAG EU 36%
15
2013 Share Asia 53%
Other
1
CAG R
NA
2010 2011 2012 2013
- 4. 4%
Europe
0
Asia
5
3
7
9
10 2008 2009
Primary Devp't by Country
Decisions surrounding …
40 35
Primary Vehicle Development
43
45
2007
Millions
Asia & Europe Dominate
2007 © CSM Worldwide
SHIFT BALANCE OF POWER
Globalization Affects More Than Production • Segment Structure • Developing markets grow towards Europe and Asia • North America adapts to B, C & D global structures
• Development Dynamics • NA development restructures •Primary development focused on non-global efforts •Secondary and advanced research treads water
• New Power Centers – Asia and Europe • Asian OEM growth • Detroit 3 platform globalization • Developing market B & C growth 2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less Is More Shifting Balance of Power Adjusting The Lens, Again …..
2007 © CSM Worldwide
SUMMARY
Adjusting The Lens, Again …. • Understanding segment and OEM shifts is paramount • BRICs growth drives new strategies • ‘Global Development’ presents new obstacles/ opportunities • New trade agreements and intra-plant flexibility shields no one
Successful suppliers already adapted to a global reality and are leveraging their position
2007 © CSM Worldwide
Michael Robinet Vice President, Global Vehicle Forecasts [email protected]
Copyright © 2007 CSM Worldwide CSM Worldwide, Inc. is the copyright holder for this document. No part of this document may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred or used in any form or by any means without CSM Worldwide’s prior written agreement. Each reproduction of any part of this document must contain notice of CSM Worldwide's copyright as follows: © 2007 CSM Worldwide. Viewing and/or using the data contained in this copyrighted document shall constitute a contract between the viewer and/or user and CSM Worldwide that the viewer and/or user will not violate CSM Worldwide's above stated copyright policy. By viewing and/or using the data contained in this copyrighted document, the viewer and/or user warrants that he/she is authorized and has the full authority to bind any corporate entity that may benefit from said viewing and/or use to the above referenced copyright contract and a general subscription contract for the viewing and/or use of the document, including the payment of all subscription fees.
Disclaimer: All information included in this report has been cross-verified to the greatest extent possible. Although every attempt has been made to ensure the accuracy of the information included in this report, CSM Worldwide claims no responsibility for any loss or damage resulting from any publication, error or omission in this report.
Management Briefing Seminars
2007
From Traverse City to Success Supplier Strategies and Tactics from MBS 2007
2007
From Traverse City to Success Supplier Strategies and Tactics from MBS 2007
Mike Robinet Vice President Global Vehicle Forecasts CSM Worldwide
GLOBAL LIGHT VEHICLE SALES Emphasis on New Markets 25
10%
2007-13 Grth
100%
ME/Af, 3%
2007 20
2.1
8%
2007-13 CAGR% (R-axis)
80%
15
6% China, 27%
40%
CE EU, 11%
3.4
16.8
2.9
1.4 0.9
4.2
0.3 1.8
ME/Africa
4.5
South Asia
S America
Japan/Korea
W Europe
3.4
S Am, 7% Jap/Kor,
2%
6.9
C/E Europe
6.6
Gtr China
5
0
60%
4%
19.0
N America
Millions
1.5
10
S Asia, 23%
20%
0%
W EU, 12%
1%
N Am, 17%
0%
Contribution to Growth 20072013 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Global Light Vehicle Production by Region A 3.7% C
90 C 4.5%
80 70
0.7% CAGR
60 Millions
C 3.8%
2.9% C
AGR
Region (2007-10, 2010-13 CAGR%)
GR A GR
South As ia (17.2%, 6.2%)
A GR
Gre ate r China (12.2%, 5.2%) C/E Europe (9.2%, 4.2%)
50 South Am e rica (7.3%, 5.0%)
40 30
M E/Africa (3.7%, 4.9%)
20
North Am e rica (0.7%, 2.5%)
10
W. Europe (0.4%, 1.6%) 2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
0
Japan/Kore a (1.9%,-0.7%)
•Global production growth rate slows but continues an emerging market focus
•Growth of South Asia eclipses that of Greater China after 2007
•Developed markets of NAFTA, W Europe and Japan/Korea essentially flat
•South America rises on domestic demand 2007 © CSM Worldwide 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS Global Production By Global Segment
2002 1997
7.3 6.3 2.5% 5.7 5.6
E
CAGR % 2007-2013
Share of Growth
-0.4%
2007-13 Growth (Mil)
FF
2013 2007
Global Segment
10.0 10.3 10.6 9.9
FF
-0.3
-2%
E
1.0
7%
D
3.3
23%
C
4.2
29%
B
4.4
30%
A
1.9
13%
16.5 13.1
D
3.8%
10.6 10.5
22.5 C
13.9
18.3 3.5%
12.5 17.5 B
10.1 9.5
13.0 5.0%
8.1 6.2
A
4.9 4.1 0
5
4.5% 10
15
20
25
Millions 2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Growth of the Asian 4 by Sales Parent 20%
16% 14% 12% 10% 8% 6% 4% 2%
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
0% 1997
Global Production Share By Sales Parent %
18%
2007 © CSM Worldwide
GLOBAL PRODUCTION PECKING ORDER Production Follows Sales Growth 1997
2013
1
US
Japan
2
Japan
US
3
Germany
China
4
S. Korea
Germany
5
France
India
6
Canada
S. Korea
7
Spain
Brazil
8
UK
France
9
Brazil
Canada
10
Italy
Mexico
11
Mexico
Spain
12
Belgium
Russia
13
Russia
UK
14
China
Thailand
15
India
Iran
Virtually Tied at 11 Mil
•Growth several emerging market locations predicated on strong domestic and export demand •Export-focused locations (Thailand, Japan, Korea, Mexico) trust upon open markets without NTB (non-tariff barriers) for volume growth/stability •Shift away from established locations difficult due to political, union, investment and ‘home country’ realities •Greater spatial positioning of future investments due to incentives, access to markets and demand diversification
2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS 59% (+6pts)
Suzuki Fiat
Global Developing Markets Share = 45% in 2013
59% (+11pts)
PSA
(+10pts from 2007)
40% (+10pts) 32% (+10pts)
Honda
48% (+17pts)
Hyundai
52% (0pt)
VW Ford
35% (+12pts)
Ren/Niss
44% (+7pts)
Central Europe Eastern Europe Andean Mercosul Mexico ASEAN China India Middle East South Africa Taiwan
Developing Markets
Major OEM Players by Type of Market - 2013
40% (+11pts)
GM
33% (+13pts)
Toyota 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Units in Millions 2007 © CSM Worldwide
BRICS PRODUCTION
Major OEM Players 2002 vs. 2007 vs. 2013 Asian 4 and upstart OEMs have the strongest BRICs growth rates
Millions
2.0 1.8 1.6 1.4 1.2 2013
1.0
2007
0.8
0.4 0.2
2002
0.6
Fi at
on da H
Ta ta
he ry C
Su zu ki
Fo rd
en /N is R
yu nd ai H
To yo ta
G M
VW
0.0
2007 © CSM Worldwide
GLOBAL STRUCTURAL SHIFTS An Expanded Perspective
• Sales Growth Drives Production Expansion Currency stabilization is key Increase in Developing Markets for both export and domestic BRICs already global on several levels Others look to lower cost locations (Asia, C/E Europe) for expansion
• Segment Shifts Towards B, C & D Development of B, C and D squarely in Asia and Europe – North America not part of the mix
Asian OEMs Localize, Upstart OEMs Expand, Others Restructure Each OEM has a strategic expansion path, partners and JVs emerge Driven by several factors: costs, new markets, market access
2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less is More Shifting Balance of Power Adjusting The Lens
2007 © CSM Worldwide
GLOBAL PRODUCTION TRENDS
Global Light Vehicle Production Capacity by Region Region (2007-13 CAGR%)
2.4% CAGR
100
85%
90 80
Millions
70
84%
ME/Africa (2.5%)
83%
South Am erica (3.2%) South Asia (7.4%)
60
82%
50
81%
40
80%
NA (-0.3%)
79%
Europe (2.2%)
10
78%
Utilization
0
77%
30
Japan/Korea (0.6%)
2013
2012
2011
2010
2009
2008
2007
2006
20
Greater China (5.5%)
• Global platforms allow greater plant-level flexibility and thus higher
utilization rates • Low/nil capacity growth in W Europe, NA & Japan • Growth in Developing Markets as low-cost surge continues
2007 © CSM Worldwide
LESS IS MORE
153
140
185
130
180
120
114
100 90 80
2005
110
Platforms Over 50K
190
2013
150
175 170 165 160
Platforms over 50K/Year 192
168
2013
195
2005
Volume Per Plant
160
2007
Volume/Plant
Thousands
Increased Scale Affects Plants and Platforms
155 2007 © CSM Worldwide
LESS IS MORE
Top 10 Platforms By Volume 2007 vs. 2013 0
(Mil)
1
2
4
(Mil)
0
1.5
R/N - B
Toyota - MC-M
1.5
Ford - C1
Ford - C1
1.5
Fiat Type 199
Honda - C-5
1.5
R/N - C
1.2
21% of Total 2007 Volume
1.2
Ford - B2
1.1
Primary Development Origin
GM - GMT900
1.0
Asia
Toyota - 330N
1.0
2013
VW PQ35/PQ36
VW PQ24/PQ25
1
2
3
Toyota - MCM
1.8
R/N - B
2007
3
North America
3.7 3.2 2.3 2.1
VW PQ35/PQ36
2.0
Toyota - MCC
2.0
R/N - C
2.0
Suzuki YN B
1.9
GM DELTA(2)
1.9
Europe Honda - C-5
4
27% of Total 2013 Volume
1.9 2007 © CSM Worldwide
GLOBAL RATIONALIZATION Less Is More
• Fewer Platforms … More Options • Enhanced intra-platform flexibility driving more bodystyles • ‘Classic’ strategy (carryover of older structures) is waning
• Emergence of Market-Specific Efforts • Low cost platforms – Tata, Ren/Nis, Toyota, GM • Developing Markets – Toyota IMV, Mitsubishi CR
• Pressure on Older, Developed Market Facilities • Easier market access from emerging locations offers competition • Remaining facilities more flexible and efficient
2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less is More Shifting Balance of Power Adjusting The Lens
2007 © CSM Worldwide
SEGMENT FOOTPRINT ANALYSIS
Production Share By Global Segment - 2013 A
40% 35% 30% 25% FF Europe Japan/Korea Greater China
B
20% 15%
• Europe and Japan/Korea focused on B- and Csegments, due to domestic market requirements and historical abilities • Fewer space considerations and lower fuel costs drive North America toward C, D, E and Full-Frame
10% 5% 0%
North America E
C
D
• Regions with a ‘segment’ footprint which varies greatly from the global average must specialize to drive exports 2007 © CSM Worldwide
SHIFTING BALANCE OF POWER
Global Production By OEM Home Region North America
Asia
North America
Asia
25% 33% 39%
2013
1997
49%
26% 28%
Europe Europe
2007 © CSM Worldwide
GLOBAL PRIMARY VEHICLE DEVELOPMENT •Vehicle Structure, Chassis & Engine Box •Build Process •Powertrain/Steering Protection •Safety, Seating Structure & Electronics R
25 20
30
. 9% +4
G CA
NA 8%
25
32
30
% +2.9
R CAG EU 36%
15
2013 Share Asia 53%
Other
1
CAG R
NA
2010 2011 2012 2013
- 4. 4%
Europe
0
Asia
5
3
7
9
10 2008 2009
Primary Devp't by Country
Decisions surrounding …
40 35
Primary Vehicle Development
43
45
2007
Millions
Asia & Europe Dominate
2007 © CSM Worldwide
SHIFT BALANCE OF POWER
Globalization Affects More Than Production • Segment Structure • Developing markets grow towards Europe and Asia • North America adapts to B, C & D global structures
• Development Dynamics • NA development restructures •Primary development focused on non-global efforts •Secondary and advanced research treads water
• New Power Centers – Asia and Europe • Asian OEM growth • Detroit 3 platform globalization • Developing market B & C growth 2007 © CSM Worldwide
PRESENTATION OUTLINE
An Expanded Perspective Less Is More Shifting Balance of Power Adjusting The Lens, Again …..
2007 © CSM Worldwide
SUMMARY
Adjusting The Lens, Again …. • Understanding segment and OEM shifts is paramount • BRICs growth drives new strategies • ‘Global Development’ presents new obstacles/ opportunities • New trade agreements and intra-plant flexibility shields no one
Successful suppliers already adapted to a global reality and are leveraging their position
2007 © CSM Worldwide
Michael Robinet Vice President, Global Vehicle Forecasts [email protected]
Copyright © 2007 CSM Worldwide CSM Worldwide, Inc. is the copyright holder for this document. No part of this document may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred or used in any form or by any means without CSM Worldwide’s prior written agreement. Each reproduction of any part of this document must contain notice of CSM Worldwide's copyright as follows: © 2007 CSM Worldwide. Viewing and/or using the data contained in this copyrighted document shall constitute a contract between the viewer and/or user and CSM Worldwide that the viewer and/or user will not violate CSM Worldwide's above stated copyright policy. By viewing and/or using the data contained in this copyrighted document, the viewer and/or user warrants that he/she is authorized and has the full authority to bind any corporate entity that may benefit from said viewing and/or use to the above referenced copyright contract and a general subscription contract for the viewing and/or use of the document, including the payment of all subscription fees.
Disclaimer: All information included in this report has been cross-verified to the greatest extent possible. Although every attempt has been made to ensure the accuracy of the information included in this report, CSM Worldwide claims no responsibility for any loss or damage resulting from any publication, error or omission in this report.
Management Briefing Seminars
2007
From Traverse City to Success Supplier Strategies and Tactics from MBS 2007
