Frank Göller: Car sales in Europe are still around 2 million vehicles below the level before the Covid crisis. At the same time, sales in China, especially those of German car manufacturers, have come under pressure. This is leading to significantly lower profits at a time when considerable investment in the products of the future is required.  The combination of pressure to transform (e-mobility), high material prices, new competitors, supply chain problems, high interest rates, and falling demand is presenting many companies with enormous challenges.

Frank Göller: One key aspect is to consistently and sustainably improve competitiveness. In most cases, a significant reduction in product costs is essential for this. Car manufacturers and suppliers are currently examining all levers to realize cost savings. This applies to material costs, production, and administration. In our Horváth CxO Study, 6 out of 10 companies stated that the achievement of savings targets will probably also be accompanied by a significant reduction in the workforce in some cases. It is also important to take advantage of the opportunities offered by digitalization to make processes significantly more efficient. 

But cutting costs is only part of the solution. The decisive factor will be to impress customers on the global markets with attractive vehicles. Electric vehicles are crucial for this, but so are highly efficient combustion and hybrid vehicles. The future of the car industry will be predominantly electric, but with a very long transitional phase. It is also crucial to master the vehicle software and to be able to offer digital applications in the car at the highest level. 

Frank Göller: It will be important for car manufacturers and suppliers to find joint solutions in this economically difficult phase in order to reach viable compromises in price negotiations, despite differing financial interests. This is important in order to secure the often long-standing partnerships and the ability to deliver along the supply chain in the long term. It is undoubtedly also in the interests of automotive manufacturers that suppliers, as a key driver of innovation, are able to operate in an economically viable manner in the long term. 

Frank Göller: Many fascinating new vehicles will come onto the market in the next 3-5 years. The model offensives of German manufacturers, in particular, are only just beginning. The range of electric vehicles will improve enormously, as will the charging infrastructure. I am optimistic that e-mobility will achieve a breakthrough in Germany and Europe in the coming years. This is already the case in China. I am also very confident that the huge efforts made by companies to cut costs will be successful and that this will significantly improve competitiveness. Significant progress has also been made in key future technologies. Just a few days ago at New Battery World in Munich, it was clear from the various presentations and discussion panels that German companies are becoming increasingly proficient in battery technology and the value creation chain.