sac corporate presentation
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Stahl Automotive Consulting
Corporate Presentation
Stahl Automotive Consulting
Agenda
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� SAC’s philosophy and areas of expertise
� Project examples
SOURCE: SAC
Stahl Automotive Consulting 2
SAC founder Martin Stahl has 20 years of broad expe rience in the automotive industry
SOURCE: SAC
Dr. Martin StahlSAC Founder, Managing Director
Martin has always been curious about the strategic questions of the automotive industry and turned his passion into a profession. His core areas of expertise are:� Corporate and growth strategy� Brand strategy � Product strategy and development� Sales and after-sales optimization� Automotive in emerging markets , especially Asia� New mobility solutions and e-mobility
Educational background
Professional background
Areas of expertise
Martin Stahl has a background in industrial engineering and holds a Ph.D. from the University of St. Gallen
He has been working with BMW Group for 10 years and with McKinsey for 4 years before founding Stahl Automotive Consulting
Stahl Automotive Consulting 3
SAC’s values and contribution
What we aim for … … and how we deliver
Inspiring leaders by helping them to develop their perspective and …
We contribute with our broad automotive experience and help to see both, the big picture and the way forward
… collaboratively create lasting and substantial performance improvements …
We apply proven approaches and methodologies with an understanding of human factors to accompany our clients in the execution of improvement initiatives and to achieve measurable results
… in a long-term partnership
We follow a rigid code of professional values to build and maintain long-term partnerships with our clients
SOURCE: SAC
Stahl Automotive Consulting 4
SAC’s core areas of competence
SOURCE: SAC
SAC’s core areas of
competence
Sourcing optimization
Productstrategy & develop-
ment
Organi-zationaltransfor-mationBrand
development
Corporate & growth strategy
(incl. M&A)
Sales &after-sales
Powertrainelectrification
Emergingmarkets
Mobility of the future &
digitalization
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Corporate & growth strategy (incl. M&A)
� Within today’s automotive landscape, many companies aspire to further expand their business while in certain regions even new automotive players emerge (e.g. China); in order to successfully realize such plans, profound market entry/growth strategies are key
� Besides internal growth projects, automotive industry players are frequently utilizing M&A transactions to grow or secure their business , especially in sectors where the incumbent players either face consolidation (e.g. German intercity coach market) or are forced by customers to expand their global footprint (e.g. acquiring a supplier in Mexico)
� Developing market entry strategies along the “4Ps” product, pricing, place and promotion accompanied by a production strategy
� Ensuring products match customer demand
� Full-fledge M&A advise− Developing a comprehensive
perspective on potential M&A targets and identifying a short-list of targets (incl. first outlook on synergies)
− Performing a strategic due diligence of the selected target(s)
− Ensuring a professional post merger integration
− Creating viable business cases(incl. profit & loss, balance sheet, cash flow)
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Brand development
� As recent examples in the automotive industry show, even solid products are no guarantee for success if the brand of the product does not appeal to the target group
� Fancy brand definitions are only a piece of paper if the values are not properly translated into the organization as well as their products and services
� In general, having a strong, vibrant and finally relevant brand is becoming an increasingly essential asset as several transactions in the automotive sector illustrate, e.g.− Tata Motors spent $ 2.3bn to acquire the
Jaguar and Land Rover brands in 2008− Geely paid $ 1.8bn to acquire the
Volvo brand in 2010
� Developing a corporate vision and brand strategy/identity (incl. values, facets) as well as defining key USPs of the brand
� Identifying an attractive and sufficiently sized target group and deriving a crisp description of the respective product needs based on proven segmentation models (e.g. SIGMA Milieus®)
� Developing a brand and product attribute profile in the context of competition and market demand to derive specific targets (best-in-class, top-3, acceptable standard)
� Consolidating the main targets in a comprehensive target picture (incl. financial KPIs) and developing a long term-plan
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Product strategy & development
� Increasing customer expectations ,especially regarding vehicle design and speed of new innovations, are affecting the automotive industry; thus, implementing a well structured and efficient product development process is crucial for any automotive OEM
� Particularly in emerging countries like China, new automotive ventures are formed without longstanding experience in vehicle development within the organization
� Moreover, today’s major OEMs use modularized platform approaches to create economies of scale and increase their cost competitiveness
� Holistic perspective on the design of automotive product development processes (PDP) to help OEMs create competitive products (passenger and commercial vehicles) at cost and in time
� Guiding vehicle projects through the concept phase to ensure coherence to the brand and product attribute profile, customer expectations and cost targets
� In-depth understanding of individual process steps within the PDP (concept, series development, pre-production)
� Insights into future product trends and customer demand based on proven market data as well as our broad expert network
SAC expertise
SOURCE: SAC
Industry situation and outlook
Stahl Automotive Consulting 8
Organizational transformation
� The global automotive industry is going through a situation of continuous transformation driven by several megatrends ; especially topics like autonomous driving, powertrain electrification, digitalization and global growth are challenging for OEMs and suppliers
� In general, companies regularly have to manage changes that affect their organization ; yet, more than half of all change projects fail because of the following reasons− 39%: Employee resistance to change− 33%: Management behavior does not
support change− 14%: Inadequate resources− 14%: Other obstacles
� Holistic change management approachbuilt around 4 key levers− Role-modeling− Fostering understanding and conviction− Reinforcing with formal mechanisms− Developing talent and skills
� Detecting and further developing core competencies of automotive OEMs (passenger and commercial vehicles)
� Identifying suitable areas for partnering/ outsourcing and supporting to find a capable partner/supplier
� Planning of organizational ramp-up, roles and key processes as well as identifying
required talent (e.g. in case of marketentry/growth strategy)
SAC expertise
SOURCE: SAC
Industry situation and outlook
Stahl Automotive Consulting 9
Sourcing optimization
� Large OEMs increasingly demand from their suppliers to serve them on a global scale(e.g. stamping parts from a single supplier regardless of production location)
� In developed countries , suppliers deliver up to 85% of a vehicle‘s major components while in developing countries , some local OEMs still have a much higher value creation share ; consequently, different opportunities and challenges arise for suppliers as well as OEMs
� Regarding EV components (e.g. battery cells) it is not yet clear which technology will prevail and purchasing volumes of EV parts are still small due to rather low sales volumes; as a result, EV manufacturerslack economies of scale and couldbenefit from bundling with partners
� Consolidating the supplier portfolio of automotive OEMs (passenger and commercial vehicles)
� Identifying and evaluating potential sourcing partners to enable order bundling (e.g. for EV batteries)
� Company- or business-unit-wide bundling ofRFQs (e.g. for service providers)
� Effectively preparing supplier negotiations
� Identifying and realizing further cost levers
� Providing suppliers with a perspective on OEMs‘ global launch and cycle plans to forecast demand for specific automotive parts/components and derive accurate timing for respective RFQs
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Sales & after-sales
� The way how people purchase mobility (incl. vehicles) is changing due to the rise of the Internet and mobile applications (see e.g. the B2C e-commerce sales growth in selected countries 2014: China 64%, India 32%, Brazil 19%, UK 12%, USA 12%)
� To date, established OEMs have large dealership networks (e.g. BMW with ~600 dealers for ~250k sold cars in Germany 2014); however, several OEMs have begun to utilize the Internet (e.g. BMW with its agent model incl. online sales for the i3/i8)
� Furthermore, new industry players are looking for innovative approaches to ramp-up their sales network at minimal cost or to provide convenient after-sales solutions(e.g. carefree repair servicesthrough specialized providers)
� Defining the right setup and footprint of a new automotive OEM’s sales and after-sales network based on the given volume aspirations and resource restrictions
� Developing a regional sales and after-sales organization tailored to the competitive arena of the specific market
� Restructuring an existing OEM’s central and local sales organization by implementing effective offline (e.g. direct sales vs. licensed dealers vs. independent dealers) and online distribution channels
� Identifying capable sales and after-sales partners/suppliers (e.g. for repair, spare parts logistics) and facilitating the partner-
ship/supplier relationship building
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Emerging markets
� The rising level of income and ongoing urbanization in emerging countries like China and India lead to increased mobility needs , most notably a growing overall vehicle demand (e.g. in India with an expected vehicle sales CAGR of 10% from 2015-2021), particularly in the luxury segment
� Driven by the political agenda , there is a strong trend towards new energy vehicles (NEV) in China (expected CAGR of NEV sales in China 2015-2021 is 20-25%)
� Besides, Chinese OEMs have recognized that joint ventures are not the optimalapproach and have thus started to create indigenous brands or to establish own companies
� Supporting automotive ventures from emerging countries in building competitive passenger/commercial vehicle OEMs that are able to meet Western quality standards
� Supporting Western industry players to expand their business to emerging markets
� Particular China expertise− Track record of successfully conducted
projects in China’s automotive industry− Broad network and access to many
OEMs in China− Mandarin-speaking interviewers with
automotive background− Forecast data for the Chinese market
(volume forecasts, cycle plans etc.)
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Powertrain electrification
� Due to environmental issues like global warming, governments worldwide aim to reduce CO 2 emissions , e.g.− EU: max. 95g CO2/km for new passenger
cars in 2020 (fleet average)− China: 5l/100km for new passenger cars
in 2020 (fleet average)
� At the same time, costs for fossil fuel are expected to increase because of natural limitation and new, expensive technologies like fracking
� Furthermore, ongoing advancements in EV technology are projected to lead to decreasing cost for EV components (e.g. price on battery cell level expected to drop from 300 to 150 EUR/kWh until 2018)
� Global perspective on EV growth as well as key market forecasts and trends for passenger cars, commercial vehicles and powertrains
� Proven TCO model to assess market break-through of individual models in specific markets from an economic perspective
� Understanding of boundary conditions (e.g. legislation) in key markets like Europe, USA and China
� In-depth knowledge of EV component cost and performance (e.g. batteries, e-motors, power electronics)
� Perspective on sourcing landscape for key EV components (e.g. for Li-ion batteries)
SAC expertise
SOURCE: SAC
Industry situation and outlook
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Mobility of the future & digitalization
� Several trends have an impact on the mobility of the future− Technological trends : e.g. autonomous
driving, powertrain electrification, further digitalization of the vehicles and the entire automotive value chain
− Economic trends : e.g. sharing economy, rise of emerging countries
− Social trends : e.g. urbanization
� As a consequence of these trends, we believe that offering transportation on demand with autonomous driving vehicles becomes a business model and that Integrated Mobility Providers will serve this business and thereby take over the customer relationships fromOEMs and rental companies
� Creating a common understanding within automotive organizations regarding the mobility of the future and performing a “fitness check” that assesses the company’s capabilities along the required core areas in the future
� Defining a vision for the automotive player in terms of whether to drive the change , be a fast follower or be a late follower
� Developing strategic measures that support the realization of the defined vision in a managed change process (e.g. transforming a traditional vehicle OEM into a service-oriented Integrated Mobility Provider)
SAC expertise
SOURCE: SAC
See our whitepaper for further information
Industry situation and outlook
Stahl Automotive Consulting
Agenda
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� SAC’s philosophy and areas of expertise
� Project examples
SOURCE: SAC
Stahl Automotive Consulting 15
SAC serves clients globally
NOT EXHAUSTIVE
SOURCE: SAC
Countries with recent SAC studies
Germany
Automotive supplierMarket study on potential in China
Sweden
Commercial vehicle OEMElectromobility strategy
Mexico
Automotive supplierStrategy for market expansion to Mexico
China
Passenger carOEMDesigning a product development process
Japan
Commercial vehicle OEMMarket study for commercial vehicles
Europe
Passenger carOEMMarket entry strategy Europe
Austria
Automotive supplierLean optimization of production
China
Passenger car OEMElectromobility strategy
Stahl Automotive Consulting
� Brand identity and related target groups in Europe
� Perspective on European market entry regarding− Product specification− Price positioning and target cost− Distribution strategy− Promotion and communication strategy− Production strategy
� Sales volume scenario
� Implementation roadmap 2015 – 2022
� Financial projections regarding the developed market strategy for 2015 – 2022
� Target picture 2022 (consolidation of study’s results)
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End products
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Project example:European market entry strategy for a new automotive player
SOURCE: SAC
� Client developed a product portfolio for an Asian market and intended to launch it in Europe
� Approach to enter the market was not yet defined
Automotive OEMIndustry:
3 monthsDuration:
1 Project leader1 Senior expert2 Consultants
Team size:
Situation
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Stahl Automotive Consulting
� General analysis of the business environment in the different Mexican states (crime rate, incentives etc.)
� Comprehensive list of potential target companies (press part manufacturers) in Mexico that meet the aligned minimum requirements
� Outside-in assessment of relevant companies on long-list plus detailed company profiles of most promising target companies
� Outlined scenarios 2020 (invest, revenue etc.) for the 4 proposed target companies and recommendation how to move forward
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End products
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Project example:Strategy for market expansion to Mexico for an auto motive supplier
SOURCE: SAC
� Tier 1 supplier for press parts plans to expand footprint to Mexico in order to fulfill OEMs demand to supply key parts locally
� Objective was to acquire a local competitor
Automotive supplier
Industry:
2 monthsDuration:
1 Project leader1 Consultant
Team size:
Situation
Stahl Automotive Consulting
End products
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Project example:Product development process (PDP) for a new Chinese automaker
SOURCE: SAC
� A Chinese SOEM planned to develop a new sub-brand from scratch with the objective to reach Western quality standards
� PDP was not yet defined
Automotive OEMIndustry:
9 monthsDuration:
1 Project leader1 Senior expert2 Consultants
Team size:
Situation
� Holistic perspective on benchmark design regarding automotive product development processes
� Defined PDP with 5 levels of granularity (incl. deliverables, synchro points, etc.) and in-depth understanding of individual process steps within the PDP (e.g. lead time for sourcing decision of individual parts/services prior SOP)
� Built organizational capabilities in order to apply PDP (e.g. program room)
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Project example:Electromobility strategy for a commercial vehicle O EM
SOURCE: SAC
� Client is a leading commercial vehicle manufacturer that needed to derive a strategy for his EV products across key regions
Automotive OEMIndustry:
18 monthsDuration:
1 Project leader2 Consultants
Team size:
Situation
� Comprehensive TCO perspective on most promising EV segments in the market
� Strategy to enhance market penetration for commercial EVs across geographies in a global approach
� Alignment of stakeholders on EV strategy across brands and functional units
� Integration of EV strategy with solution-oriented sales process and detailed plan for further implementation
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End products
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Project example:Electromobility strategy for a passenger car OEM
SOURCE: SAC
� Client wanted to derive a market entry strategy and align R&D efforts accordingly to come up with winning products
Automotive OEMIndustry:
4 monthsDuration:
2 Project leaders4 Consultants
Team size:
Situation
� Segmentation of the target market based on use case analysis of more than 10 customer groups
� Harmonized R&D landscape for key EV components (battery, e-motor, power electronics)
� Target cost for EV components as a guideline for development and purchasing
� TCO analysis regarding development of different EV powertrains in market segments
� Implications for R&D strategy, product portfolio and go-to-market approach
End products
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Stahl Automotive Consulting
Dr. Martin Stahl Managing Director
Stahl Automotive Consulting GmbH & Co KG Otto-Heilmann-Straße 5 D-82031 Grünwald
Mobil: +49-170-410-7566
E-Mail: [email protected]
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