Speaking at the annual meeting of the steel division of the Institute of Materials, Minerals and Mining (IoM3), Professor Garel Rhys, director of the Centre for Automotive Industry Research at Cardiff Business School, said the major challenge for the automotive supply chain was coping with fundamental change in a dynamic automotive sector.
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In his opening address, Professor Rhys pointed to exciting times ahead with super competition, less product differentiation and severe price and non-price competition: “There is nowhere for the inefficient to hide.”
Addressing an audience of steel industry executives and technical managers, Professor Rhys said the global automotive industry remains one of the world’s greatest industrial and commercial sectors.
Accounting for almost 10% of manufacturing output and employing nine million people throughout the value chain within the European Union alone it continues to present a huge opportunity for suppliers.
“More motor vehicles will be produced in the world in the next 20 years than in the last 100 years of the motor industry’s existence,” said Professor Rhys. “Nearly 180 new production plants, each capable of making 300,000 vehicles a year, will be required to make these new vehicles, most in new manufacturing locations. This will need an investment of 80 trillion dollars in today’s money. The financial, logistical and operational requirements of achieving this will be huge.”
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