Consolidation Among Auto Parts Suppliers Surging

Jan. 13, 2005
Major deals among global automakers are driving sweeping changes in other segments of the industry, most noticeably a growing trend toward consolidation by original equipment manufacturers. So reports the 1998 PricewaterhouseCoopers Global Automotive ...

Major deals among global automakers are driving sweeping changes in other segments of the industry, most noticeably a growing trend toward consolidation by original equipment manufacturers. So reports the 1998 PricewaterhouseCoopers Global Automotive Deal Survey, which predicts the trend to continue for several more years. According to the consulting firm's survey, slightly more than half of 1998's 620 worldwide automotive deals involved parts suppliers; the deals were valued at $30.3 billion (nearly double the value reported in 1997); and the average value of the 10 largest deals more than doubled. U.S. suppliers accounted for 56% of last year's total number of deals. PricewaterhouseCoopers analysts offered several predictions on the future of the automotive suppliers market, including:

  • Intense competition, tight profit margins, and excess capacity will challenge the viability of companies that produce fewer than 2.5 million units a year, lack a strong brand position, or cannot raise adequate research-and-development funds.
  • A company with sales of $500 million or less probably lacks the critical size to remain a Tier 1 supplier.

Popular Sponsored Recommendations

Process Mining For Dummies

Nov. 19, 2023
Here it is. Everything you need to know about process mining in a single book, written in the easy-to-understand, hard-to-forget style that ‘For Dummies’ manages so effortlessly...

7 Crucial Steps to Improve Your OT Security

Oct. 23, 2023
Enhance OT security in manufacturing and production. Uncover the crucial steps to safeguard your operational technology. Protect against evolving threats and bridge the IT-OT ...

Are You Positioned To Tackle Supply Chain Risk?

Sept. 20, 2023
Supply chain disruption is here to stay, but you can keep ahead of potential issues — and identify new opportunities — by regularly assessing your suppliers. Download our supplier...

You Cannot Stay Competitive by Bolting New Technologies to a Legacy ERP

Oct. 20, 2023
Read this white paper to understand the benefits of shifting to a next-generation ERP system as part of a DOP.

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!