KPMG's Global Automotive Executive Survey
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technological fit KPMG’s Global Automotive Executive Survey 2015 Who is fit and ready to harvest? kpmg.com/GAES2015 How do we cut through complexity? View the interactive version of this survey online and filter the results based on your own preferences KPMG’s Global Automotive Executive Survey 2015 Acknowledgements Foreword The Global Automotive Executive In coming years the automotive sector will need to achieve a fine balance Survey is KPMG International’s annual between its traditional product- and technology-driven past and its potentially assessment of the current state and ubiquitously connected consumer lifecycle-centric and service-driven future. future prospects of the worldwide automotive industry. In this year’s survey, 200 senior executives from As this year’s survey findings now in its 16th consecutive year. the world’s leading automotive demonstrate, the industry seems We have placed the findings online companies were interviewed, to be positioned halfway between and made them interactive, enabling including automakers, suppliers, these two imperatives. On the one you to not only digest our general dealers, financial services hand, increasingly strict regulatory conclusions, but to also draw your providers, rental companies standards call for a strong focus on own inferences for your specific and mobility solution powertrain optimization, rationalization area of interest, all of which should providers. The responses and standardization. On the other, help you cut through complexity were very insightful and we increasingly tech-savvy customers and extract the maximum value would like to thank all those are helping to create a completely for your business. who participated for giving new mobility culture. us their valuable time. I personally invite you to get involved Special thanks to Moritz Tomorrow’s consumers will not only and access our online version of the Pawelke and his team for expect, but demand new and survey at kpmg.com/GAES2015. their efforts. innovative services and mobile apps that plug seamlessly into ubiquitously Enjoy the read! connected solutions. To stay ahead, traditional automotive players may need to reinvent their business models and ask themselves two pressing questions: “how do I become a high value service brand, while making the most of my strong product and engineering heritage?” and secondly, “how do I think about my brand from a consumer perspective, to attract the new generation of ‘digital natives’?” Dieter Becker Global Head of It is not just the automotive industry Automotive that is changing; so has our survey, KPMG International 2 | KPMG’s Global Automotive Executive Survey 2015 Contents Executive summary 4 About the survey 6 Mobility culture 8 What is driving consumer demand? Technological fit 16 Are companies betting on the right technologies? Business model readiness 26 Is the industry set for an unstable mobility eco-system? Prepared to harvest 34 Who is best positioned for sustainable growth? KPMG Global Automotive thought leadership 38 © 2015 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. KPMG’s Global Automotive Executive Survey 2015 | 3 Executive summary Key trends to 2025 Vehicle segment Investment E-car market preferences priorities to 2020 penetration to 2025 Many innovative key trends are lower on executives’ The small and basic car Downsizing is still the High e-car market share agendas up to 2025: segment is expected number one powertrain forecasts appear contrary to to have a high growth investment area over the investment priorities: The majority of the executives potential in established next fi ve years: still feel that growth of and emerging markets The majority of auto execs emerging markets is the over the next fi ve years: However, since the 2014 from Western Europe and Mobility number one key trend. Technological survey, auto execs from China believe that the share culture Executives from mature fi t mature TRIAD markets have of electrified vehicles (among Only a minority of markets predict decreasing become relatively less overall new car registrations) respondents consider sales potential for the large focused on this area than will be between 11-15 Auto executives‘ alternative powertrain car segment up to 2020, with According to this their BRIC counterparts. percent. Respondents from views tend to refl ect technologies, mobility a more positive view of the year’s survey, North America are even more services and vehicle The number two investment concerns over basic and small car segment. the optimization optimistic, with most connectivity as extremely priority for both TRIAD and foreseeing a share of current commercial important key trends BRIC market respondents of traditional BRIC execs is fuel cell between 16-20 percent challenges, suggesting until 2025. envisage tremendous growth fossil fuel-based vehicles, replacing pure in 10 years. potential for all car size battery electric technology. a lack of consensus Please see p8-9 segments in the next fi ve propulsion Please see p20-21 Please see p16-17 over the shape of the years, particularly small and technologies still basic cars. future mobility Purchasing criteria dominates the Connectivity: eco-system. to 2020 Please see p12-13 technological E-car technology The next big thing roadmap. trends to 2020 Purchasing choices over Vehicle ownership The notion of self-driving the next fi ve years versus usage Plug-in hybrids are set to cars as the last evolutionary are not yet driven by attract the highest demand step of connectivity seems innovative concepts Vehicle ownership for all of all electrifi ed propulsion to be more distant than KPMG viewpoint and online services: age groups is considered technologies: media attention suggests: important up to 2020: Auto executives believe Although still rated as the Auto execs from mature Asian countries like Japan Auto execs are consumers are still fi xated Most respondents believe most important e-technology, plug-in hybrids’ popularity has and Korea are slightly more caught between on traditional product issues, vehicle ownership will still be with fuel effi ciency rated important for under-25s, while diminished year-on-year. optimistic about autonomous regulations that clearly as number one, those aged between 25-50 driving, believing there will be create technological closely followed by safety are expected to be even more Battery electric vehicles a breakthrough in the next 20 challenges, and and comfort. reliant on their own cars for remain in number two years. Respondents from position. However, in contrast satisfying the target personal mobility. Western Europe, North Compared to the 2014 survey, to prior years, a higher America and China are group of tech-savvy executives see a heavily Mobility services are forecast proportion of respondents more hesitant. mobility consumers, increased emphasis on to be an important source of believe demand for fuel cell that are never offl ine. enhanced vehicle lifespan, profit in fi ve to 10 years in electrical vehicles will increase Please see p22-23 most likely due to the both established and over the next fi ve years. burst of product recalls emerging markets. in recent years. Please see p18-19 Please see p14-15 Please see p10-11 Are companies betting on the right technologies? What is driving consumer demand? 4 | KPMG’s Global Automotive Executive Survey 2015 © 2015 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. Business model Readiness for a new Strategies Race for market disruption ahead? mobility eco-system to survive share until 2020 No major business model Traditional automotive OEMs’ key survival strategy In the medium term, change or disruptive event OEM brands should matter is to achieve and maintain traditional OEMs are is expected over the next most in 10 years’ time: global reach. forecast to maintain their fi ve years: dominance. However, they Auto execs believe For globally established should prepare for a more Most auto execs believe it is extremely likely that OEMs, such as BMW, disruptive future. Business that original equipment automotive premium and Volkswagen and Toyota, Prepared to model manufacturers (OEMs) mass market brands will remaining independent is harvest Auto execs are most will continue to own dominate over the next the top priority. optimistic that the readiness the customer relationship decade, followed by pure Hyundai group will increase up to 2020. e-car manufacturer brands. OEMs with limited global Executives feel there its global market share. reach, mainly from China will be no major shift Executives are very Please see p26-27 Brands from the ICT sector and mature Asian countries, Volkswagen is considered optimistic that are predicted to be more are most likely to merge with of power between to have far greater potential Business and investment traditional automotive important than traditional others in order to survive. OEMs until 2020. than its closest competitors, strategies should remain Tier 1 supplier brands. Toyota and GM. players can cope with conservative until 2020: Please see p32-33 an increasingly Global players like Daimler, When it comes to Chinese Organic growth is expected BMW and GM are considered OEMs, respondents rate unstable mobility to be the number one to be best prepared, closely Chery as having the best eco-system in the strategy for future success, followed by Volkswagen, chance of increasing market with two-thirds of auto Toyota and Ford. share up to 2020. short term. execs rating this factor as extremely important. In the executives’ eyes, Tata, another emerging newcomers like Tesla still OEM, is rated very positively Since 2014, an increasing have a huge gap to close and is expected to grow its KPMG viewpoint number of respondents feel it to achieve the awareness market share. will be necessary to diversify and reach of traditional Future automotive and expand the value chain OEM brands.