European Automotive

Survey 2013
Survey results

Structure of the study

Survey of 300 companies active in the European

automotive industry (15% OEMs, 85% suppliers)
Phone interviews conducted by an independent
market research institute in January 2013
(Valid Research, Bielefeld).

Peter Fu
Partner/German Public Auditor/German Tax Advisor
Senior Advisory Partner Automotive GSA
Ernst & Young GmbH
Wirtschaftsprfungsgesellschaft
Mergenthalerallee 3-5
65760 Eschborn
Phone: + 49 (6196) 996 27412
peter.fuss@de.ey.com

February 2013

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Ernst & Young

Country
Germany

75

France

60

Italy

30

Spain

30

United Kingdom

30

Russia

15

Austria

10

Czech Republic

10

Slovakia

10

Poland

10

Portugal

10

Hungary

10

Current and future business situation

OEMs significantly more satisfied than suppliers

German automotive industry doing good business
How would you assess your current business situation?*
Germany

Europe

OEMs

Suppliers

29

33

45

56
14

14
12
16

38

31

41

17
1
Good

11

Fairly good

4
Medium

Fairly poor

11

4
Poor

12
4
*All results in percent

Europes auto industry managers are satisfied for the most part with their current business situation.
In Europe, OEMs are on average more satisfied than suppliers: 56% of OEMs are completely satisfied with their
current situation; the corresponding figure for suppliers is only 29%.

February 2013

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Italys automobile industry is in a deep crisis

How would you assess your current business situation?*

Eastern European companies

are significantly more satisfied
with their current business
situation than western
European companies.
In Germany, the UK and
France respondents report
above-average satisfaction.

Respondents from European countries:

Germany

45

UK

30

France

30

Spain

The majority of companies in

Italy report a poor business
situation (63%).

Italy

February 2013

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Ernst & Young

33

31

11 1

44

3 3

47

23

36

17
50

35

Good
*All results in percent

18

24

Eastern Europe
Western Europe

20

33
13

12

13

15

44

14
Fairly good

37
Medium

42
12

Fairly poor

Poor

Mainly optimistic projections

How will your companys business situation develop over the next six months?

All respondents

Respondents from European countries:

France

1 10

25

Germany

21

11

10

79

8
2

UK

22

Spain
Italy
68

Significantly improve

65

Slightly improve

65

12
4

60

28

64

Eastern Europe

17

Western Europe

15

13

32
75

8
1

Slightly deteriorate

Significantly deteriorate

70

14
*All results in percent

Auto industry managers in eastern Europe, France, Germany and the UK in particular look to the future with
optimism. In Italy, by contrast, every third respondent anticipates a deterioration in their own business situation.

February 2013

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Ernst & Young

...but a further decline in sales is expected in

western Europe
How will global passenger vehicle sales develop in the next 12 months
in the following regions?*

Auto industry managers expect

sales to increase in Asia in
particular.
A further decrease is forecast
for western Europe. Only 15%
of respondents expect sales
figures to increase.

Respondents from European countries:

China

43

India

32

Rest of Asia

Respondents in Germany
expect the western European
market to decrease by 3%.

31

+4%

+3%

+2%
1

49

32

+2%
1

South America

16

34

North America

35

Eastern Europe

35
12

Slightly increase (up to 5%)

Slightly decrease (down no more than 5%)

Significantly decrease (down more than 5%)

Ernst & Young

41
42

+2%

+1%

17

39
42

Significantly increase (more than 5%)

Page 7

19

45

12

Western Europe 3

February 2013

13

43

18

Russia

40

16
35

3
8

+1%
-1%

Remain roughly the same

*All results in percent

Growth only in the lowest and highest price

segments
What short- and medium-term prospects do you foresee for the
new passenger vehicle market?*
Low-price segment (up to EUR 15,000)

Mid-price segment (up to EUR 30,000)

Upper price segment (up to EUR 50,000)

Premium/luxury segment

Growth

Stagnation

Decline

52

20

28

48

34

38

20

32

37

29

43

19

*All results in percent

Growth in small cars segment: 52% of respondents expect healthy growth rates in low-price segment.
No consensus on luxury cars segment: indeed, 34% expect strong growth in this segment, while a 29% forecast
stagnation or even declining sales figures.

February 2013

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The companies strategic and operational planning

Despite the crisis: production capacity also to

increase in Europe
Do you expect to increase or decrease your production capacity in the coming year?*
All respondents

32

German companies
27

38

53

65

51

38

55

15

11

in Europe

worldwide

in Europe

worldwide

Increase

Remain unchanged

Decrease

*All results in percent

Despite the crisis, the European companies polled intend to increase more often than reduce production capacity,
not only worldwide but also in Europe.
German companies are more cautious when it comes to increasing capacity in Europe.

February 2013

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Production in Europe: OEMs are considerably more

cautious than suppliers
Do you expect to increase or decrease your production capacity in Europe in the
coming year?*
Respondents from European countries:
UK
Spanien
Deutschland
Frankreich
Italien

7
32
8

27

25

34

68

13

51

19

42

14

Remain unchanged

Suppliers

17

47

Osteuropa
Westeuropa

Increase

52

OEMs

30

Decrease

15

15

*All results in percent

One in three Spanish companies intends to reduce production capacity throughout Europe in 2013 by contrast, a
very small percentage of British, German and French companies intend to reduce capacity.
42% of companies plan to step up investment in eastern Europe; in western Europe, the corresponding figure is
only 30%.

February 2013

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German companies intend to continue creating

jobs...
How will employment in your company develop over the next six months?
All respondents
20

German companies

28

22

61

67

11

11

10

worldwide

in Europe

worldwide

61

19

in Europe
Increase

Remain unchanged

Decrease

30

60

*All results in percent

Considerably more European companies in the automobile industry intend to create jobs (28%) than to cut them
(11%). In Europe, by contrast, employment is likely to stagnate at best: one in five companies intends to create
jobs, and the same number plan to reduce headcount.

February 2013

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...but in Europe the labor market is stagnating

How will employment in your company in Europe develop in the coming year?*

Respondents from European countries:

Spain
UK
Germany
France
Italy

25
11
17

20

66

61

17

19

7
19
17

Remain unchanged

17

22

12
37

Suppliers

25

11

Eastern Europe
Western Europe

Increase

30

OEMs

26
18

Decrease

*All results in percent

Alarm signals for Italy: In Europe, only 7% of the Italian companies polled intend to create jobs; by contrast, more
than a third (37%) intend to cut jobs.
Eastern European companies are more optimistic in their HR policy than western European companies.

February 2013

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Companies opt for greater flexibility

Are you currently planning to step up one or more

of the following measures aimed at raising flexibility?*
Flexible working time
models
(e.g. phased retirement).

21

Integration of external
providers

12

Concentration of
production locations and
administrative units

Are being implemented

12

40

28

17

Establishment of
Shared Services Centers

47

26

38

21

18

30

Are planned

"Implemented" and "planned"

OEMs

Suppliers

Working time
models

34

49

Integration of
external providers

46

39

Concentration of
production
locations

43

37

Shared Services
Center

33

29

*All results in percent

In view of the uncertain economic development, companies are taking various measures geared to increasing
flexibility and efficiency. The most common measures implemented or planned are flexible working time models
(47%); external providers are also increasingly being integrated (40%).

February 2013

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Ernst & Young

Business models and product ranges under

scrutiny
Strategic realignment: are you currently planning
one or more of the following measures?
Check whether business
models are future-proof

33

Revision of product range

31

Restrict non-strategic
activities
19

Strategic acquisitions

17

Divestments
Are being implemented

11

68

37

27

Acquisitions in order to
increase cost synergies

72

39

60

33
54

35
48

31
22

33

Are planned

"Implemented" and "planned"

OEMs

Suppliers

Business models

68

73

Product range

74

67

Restrict nonstrategic activities

50

61

Acquisitions (cost
synergies)

52

55

Strategic
acquisitions

46

49

Divestments

25

34

*All results in percent

In order to make themselves crisis-proof, 72% of the companies polled are reviewing whether their business
models are future-proof and two thirds are giving their product range a complete makeover.
Acquisitions for cost or strategic reasons are on the agenda at half of the companies.

February 2013

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Ernst & Young

OEMs in particular are increasingly backing

research and development
How will your companys investments in research and development develop in the
coming year?*
All respondents

German companies
Decrease

Decrease
Increase

Increase

33

Increase

Decrease

OEMs

41

Suppliers

32

40

58

60

Constant

Constant
*All results in percent

Despite rising cost pressure, most companies do not intend to save on research.
One in three intends to increase its R&D spend; only 7% intend to decrease these investments.
In Germany, the companies are more willing to invest: 40% intend to increase their R&D spend.

February 2013

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Ernst & Young

Focus on optimizing processes

Are you planning to increasingly streamline processes

in the following business units?
Purchasing

33

70

37

68

"Implemented" and "planned"

OEMs

Suppliers

Purchasing

68

70

Personnel
development

68

68

Personnel development

30

38

Production

31

36

67

Production

68

67

Marketing/sponsorship/
events

29

38

67

Marketing/events/
sponsorship

71

65

Sales

73

63

Administration

68

55

Sales
Administration
Are being implemented

33
30

65

32
28

Are planned

58

*All results in percent

In the coming year, the companies intend to streamline structures in procurement in particular (70%).
More than two thirds of the companies are also looking at personnel development, production and marketing in
order to increase efficiency.

February 2013

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Attractiveness of automotive sites

Top countries: innovation power

In your opinion, how competitive are the following automotive hubs with respect to
innovation power?*
Germany

44

Japan

24

South Korea

41

20

China

41

18

USA

42

13

Brazil

10

India

10

Sweden

43
39
35

13

30

France

28

Russia

24

Czech Republic

UK

27

Italy

Slovakia

Poland

23
24
23
17

Turkey 1

17

Hungary 1

17

Spain

14

*All results in percent

February 2013

37

Very competitive

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Fairly competitive

Ernst & Young

Top countries: innovation power

Difference 2011-2013 in percentage points

South Korea

21

Brazil

13

Sweden

USA

Japan

India

China

Germany

Slovakia

Czech Republic

-2

Hungary

-3

Turkey

-3

Russia

-4

Poland

-8

Italy

-9

UK

-11

Spain

-12

France

February 2013

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Top countries: product quality

In your opinion, how competitive are the following automotive hubs with respect to
product quality?*
Germany

51

Japan

37

28

44

Sweden

19

43

South Korea

19

42

USA

13

UK

13

France

47
35

10

Italy

34

Czech Republic

34

31

Brazil

Spain

China

29
28
27

Slovakia

24

Russia

23

Poland

23

India

22

Hungary 1
Turkey

*All results in percent

February 2013

20
17
Very competitive

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Fairly competitive

Ernst & Young

Top countries: product quality

Difference 2011-2013 in percentage points

South Korea

22

Japan

18

Sweden

14

Brazil

13

USA

11

Germany

11

Czech Republic

UK

Slovakia

China

Italy

Turkey

-1

Poland

-1

Spain

-1

Russia

-2

Hungary

-4

India
France

February 2013

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Top countries: manufacturing costs

In your opinion, how competitive are the following automotive hubs with respect to
manufacturing costs at present?*
China

40

India

31

34

Czech Republic

35

54

Slovakia

10

51

Hungary

11

Poland

Brazil

South Korea
Turkey
Russia

46
49
45

37

35

34

Germany

21

Japan

22

USA

23

Spain

21

Sweden

France

Italy

13

UK

13

*All results in percent

February 2013

16
15

Very competitive

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Fairly competitive

Ernst & Young

Top countries: manufacturing costs

Difference 2011-2013 in percentage points

Slovakia

27

China

26

India

25

Czech Republic

22

Hungary

19

Poland

17

Brazil

14

South Korea

Turkey

Russia

Sweden

-6

USA

-7

Spain

-10

Italy

-15

Japan

-18

Germany

-18

France
UK

February 2013

-19
-21

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Top countries: productivity

In your opinion, how competitive are the following automotive hubs with respect to
productivity?*
Germany

30

44

Japan

21

45

South Korea

20

46

China

25

India

16

USA

France

38
38
36

36

Sweden

11

UK
Poland

35

12

Brazil
Czech Republic

36

29

31

31

Slovakia

29

Hungary

27

Russia

26

Turkey

25

Italy
Spain

6
3

*All results in percent

February 2013

22
23
Very competitive

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Fairly competitive

Ernst & Young

Top countries: productivity

Difference 2011-2013 in percentage points

South Korea

26

Brazil

15

India

13

China

Czech Republic

Japan

Germany

Poland

USA

Slovakia

Hungary

Turkey

Sweden

UK

-2

Russia

-3

Italy

-7

France

-7

Spain

February 2013

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