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How Do We Make the Next Big Thing Like It's No Big Deal?

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How Do We Make the Next Big Thing Like It's No Big Deal? How do we make the next big thing like it’s no big deal? Get innovative. Get NX for product development and manufacturing. Today’s manufacturers face daunting challenges: they need to develop innovative products faster than ever before, while meeting higher expectations for quality and process effi ciency. NX™ from Siemens PLM Software can help you overcome all these challenges. With best-in-class functionality for CAD, CAM and CAE solutions, NX accelerates your development process, increases productivity and enhances product quality. The result: delivering your next big innovation becomes that much easier. Find out more at www.siemens.com/nx. Answers for industry. © 2011 Siemens Product Lifecycle Management Software Inc. All rights reserved. Siemens and the Siemens logo are registered trademarks of Siemens AG. NX is a trademark or registered trademarks of Siemens Product Lifecycle Management Software Inc. or its subsidiaries in the United States and in other countries. All other logos, trademarks, registered trademarks or service marks used herein are the property of their respective holders. Siemens2011_NX_overall_auto_GER.indd 1 8/16/2011 11:10:24 AM >> INSIDE: TALK FROM THE TOP Bentley CEO Wolfgang Duerheimer, Jaguar Land Rover CEO Ralf Speth and Mini boss Kay Segler AUTOMOTIVE NEWS EUROPE LETTER FROM THE EDITOR Harald Hamprecht is Editor-in-Chief at Automotive News Europe. He can be reached at Fire fighters [email protected] he hottest fires make the hardest steel, or so the saying EUROPE’S TOP 10 goes. In real life, the economic crisis blazing through south- Tern Europe is turning profits into ashes. It is estimated that Western European passenger-car sales for top 10 brands nearly every European volume manufacturer had an operating 2012* 2011 % CHG loss in Europe last year. Peugeot, Citroen, Renault, Opel/Vauxhall ▲▲▲ and Fiat are doing all they can to try to defy the downturn (page 1. Volkswagen 1,415,041 1,607,582 -12 12) because no one wants to end up like Saab. 2. Ford 975,356 1,068,282 -9 To avoid getting into deeper trouble, those volume brands will 3. Opel/Vauxhall 971,257 969,026 0 need to address four key weaknesses. 4. Peugeot 859,356 899,373 -4 1. Europe-centric: The five brands mentioned above are too 5. Renault 810,403 1,019,140 -20 dependent on Europe, where sales are expected to decline for the fifth consecutive year in 2012 (see chart). 6. Citroen 675,714 763,110 -11 2. Stuck in the middle: The Asian automakers, especially the 7. Audi 647,652 658,746 -2 Koreans, are attacking from below while premium manufacturers 8. BMW 643,652 619,522 4 are pushing more and more product into the subcompact and compact segments. 9. Fiat 628,181 670,199 -6 3. Overcapacity: Automakers such as Renault, Peugeot, Fiat 10. Mercedes 586,298 567,886 3 and Opel have either delayed needed restructuring of their manu- Total market 12,482,075 13,201,216 -5 facturing footprints or did not cut deep enough in the past. 4. Weak brand portfolio: European automakers must accept SOURCE: IHS AUTOMOTIVE; *FORECAST that one can only stretch an existing brand so far. For example, sister brands Citroen and Peugeot compete for the same cus- tomers – and neither has a budget brand, like Renault’s Dacia, pany quickly tumble back to the brink of failure. Besides, nor a premium brand, like Volkswagen’s Audi, to generate profits. Marchionne has often over-promised and under-delivered. I am still waiting for the year when Lancia and Alfa Romeo will do as THE EXCEPTION Marchionne predicted and each sell 300,000 cars a year. There is one volume automaker on the European battlefield that is Marchionne is Mr. Big Picture. He says he is searching for a new an exception: Volkswagen. Last year, the longtime No. 1 partner to join the Fiat-Chrysler alliance so it can better compete automaker in Europe rose to No. 2 from third in global sales. against VW. Marchionne should get his business straightened out It’s impressive, but don’t forget that the company was in rough before he tries to create an even bigger conglomerate of strug- waters when Bernd Pischetsrieder took over as group CEO from gling volume manufacturers. Ferdinand Piech in 2002. The company’s profits plummeted in 2003 while the fifth-generation Golf disappointed and the Phaeton Coming back to hot fires and hard steel, my advice to European flagship flopped in 2004. In 2005, VW was shaken by a sleazy volume manufacturers is simple: Use the crisis. Develop a clear corruption affair. That same year, Wolfgang Bernhard joined VW’s strategy and execute it to perfection. Improve quality and offer management board and helped end a dark period when produc- designs that make car buyers’ wallets jump out of their pockets. tion efficiency was a foreign concept at the company. Speed up efforts to improve your cost-competitiveness. If your plants cannot become more efficient then fight through the politi- By 2007, Martin Winterkorn took over and now VW’s billions in cal battles and shut them. Otherwise, massive structural costs operating profits make it the envy of the auto industry. But it will continue to devour your profits. won’t be easy to maintain the momentum in a declining market, especially with the Golf, Europe’s top-selling car for the last four Cooperate more! This would be much easier and more success- years, undergoing a model changeover. Another challenge is that ful than organizing megamergers. the Up minicar is likely to steal sales away from the Polo sub- In a nutshell, stand out or stand aside. Transform into the lean- compact. est, most innovative manufacturers in the world. Europe’s auto- FUMBLING FIAT motive brands have the heritage and people needed to achieve At the other end of the spectrum is Fiat – the biggest loser in greatness. 2011 among the major automakers with a European sales Of course, I am well aware that all of this it is easier said than decrease of 17 percent. Fiat is getting stung by Italy’s sales done. But it is not impossible, as the revival of British luxury and slump. It’s also hurt by an aging lineup that resulted from CEO premium brands shows (page 32). Sergio Marchionne’s decision to delay product launches during the Great Recession. In addition, Fiat is in the middle of the I hope you enjoy this issue. Chrysler merger, which Marchionne says is only about 20 per- cent finished. I am reluctant to praise the CEO too much. The man definitely revived Fiat. He also saved Chrysler from extinc- tion, but there are others who once made the same claim – Bob Lutz, Dieter Zetsche, Wolfgang Bernhard – only to see the com- MARCH 2012 AUTOMOTIVE NEWS EUROPE 3 AUTOMOTIVE NEWS EUROPE INSIDE THIS ISSUE www.autonewseurope.com 22 MARCH 2012 EDITION JASON STEIN Publisher and Editorial Director +1 313 446 0376 [email protected] NINA SAUER Associate Publisher +49 89 381 517 400 contents [email protected] 3 Letter from the Editor 42 Surging Skoda KEITH CRAIN Czech brand remains on Publishing Director MARKETS record-breaking course PETER BROWN 44 Module-mania Group Publisher 6 Focus on France VW Group pushes production network EDITORIAL Sales will slump, but no need to panic to new heights HARALD HAMPRECHT Editor-in-Chief 8 Europeans gain in China +49 (0) 173 257 86 88 Germans lead; French, Fiat need SUPPLIERS [email protected] to move faster DOUGLAS A. BOLDUC 46 Inside action Managing Editor +49 (0) 171 424 6373 COVER STORY Suppliers do more with less to create [email protected] cutting-edge interiors PAUL McVEIGH Managing Editor 12 Defying the downturn 48 Mobility 3.0 +49 (0) 176 7835 3951 New solutions for getting from A to B [email protected] How Europeans plan to overcome tough times at home 50 Brave new world LUCA CIFERRI Chief Correspondent Hollywood fantasy comes closer +39 01196 91970 to reality at CeBIT [email protected] NEW CARS STEVE MASSIE 52 Car cutaways Design Director 21 Auto arrivals Who has parts in the Citroen C4 [email protected] See which new models will debut and Toyota Yaris? Bruce Gain (France), Bertrand Gay in 2012 54 New frontier (France), Nick Gibbs (UK), Stefan Grundhoff (Germany), Lois Hoyal A-Z of Geneva auto show debuts Brembo wins big by moving beyond (Germany), Yang Jian (China), David supercars Jolley (Germany), Joaquim Oliveira 22 Audi to Bertone (Portugal), David Sedgwick (U.S.), Sebastian Viehmann (Germany) A3 loses weight; car legend revived Correspondents 23 BMW to Ferrari DATA ADVERTISING Swoopy 6-series sedan; 56 European sales figures EUROPE 599 successor powers up NINA SAUER Market analysis by model for 2011 Director of Sales, Marketing and Events 24 Ford to Mercedes +49 (0) 89 381 517 400 Electrifying sports car; a cool A class [email protected] RETAIL STEFANO D’AMIANO 26 Mini to Peugeot Sales Manager Quirky subcompact; 208 pocket rocket 62 Second chance + 31 (0) 299 769 110 [email protected] 28 Geneva floor plan Used-car sales rescue automakers, GEORGIA CHAPMAN 30 Pininfarina to Skoda dealers in hard times Marketing and Events +49 (0) 176 2076 9139 Zoe sparks EV market; [email protected] Toledo lives again HUMAN RESOURCES USA 31 Smart to Volvo 64 People on the move RICK GREER An affordable hybrid; downsized Sales Director New faces in key management +1 313 446 6050 Swedish luxury [email protected] positions KOREA JUNG-WON SUH OEM Sinsegi Media Inc. FINAL WORD +82 2 785 8222 32 The British are back [email protected] 66 Diversity Inc.
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