This article was first published on Automotive World.
The automotive industry still faces tremendous challenges from tougher CO₂ emissions regulations, the increase in e-mobility and digitalisation. Meeting those challenges has been made more complex by new players entering the market and shaking things up, leaving traditional OEMs considering their future role.
Currently, all OEMs face four central challenges ranging from tightening CO₂ emissions reduction targets to developments in autonomous driving, new mobility platforms and increased connectivity. There are clear questions about how well companies are dealing with these challenges, how prepared they are for change and whether they will be able to adapt quickly enough. It is clear that most will struggle to meet the new EU target of 95g/km emission target by 2021.
To try to provide an objective answer to these questions PA has drawn up a Future Mobility performance score for the top 13 global car makers. This is based on the current and upcoming OEM product portfolio and uses a weighted scoring of up to 100 points across six key areas. These are: technology and strategy (30%), battery technology (20%), culture and incentives (10%), supplier network (15%), ecosystem and partners (15%) and financial performance (10%).
At the moment, Tesla comes out top of the rankings due to its 100% e-mobility portfolio. But by 2021, PA forecasts that it may fall to seventh in the rankings. This fall reflects the production problems with the Model 3 and its effect on profit expectations.
In contrast, by 2021 the German OEMs are forecast to take back the top spots in the rankings, with Daimler, BMW, and VW coming first, second and fourth respectively. Renault Nissan Mitsubishi is predicted to split the Germans and take third place.
BMW´s success reflects a strong global sales base and an increased focus on EVs through a service portfolio and charging station installation. Daimler’s performance comes from their full commitment to electric vehicles and a focus on the integrated ecosystem to support them. Another strong performer is Toyota, which currently leads the global market in hybrids. PA forecasts it will climb from eighth to sixth, just ahead of Tesla.
While there are some clear winners, a number of leading companies will struggle to meet the challenges ahead. These include GM, PSA, Fiat Chrysler and Ford. FCA and Ford simply haven´t yet developed products that will meet the CO₂ reduction targets and their low rankings reflect their need to take rapid action to change their product portfolio.
All this underlines that the CO₂ 95g/km target for 2021 was, and is still, a challenge for OEMs. However, after the first-round of emissions regulations, new players in the market changed expectations, thinking and technical approach. German car makers are now responding and speeding up their work to get them back on track. However, the race for market leadership remains open race and new players, such as those from China, could well emerge to change the game again.
Tim Lawrence is global head of manufacturing at PA Consulting