Carmakers maturing, but can they go global?

• Source: Chinadaily
• [17:36 April 20 2009]
• Comments

 New technologies

Another challenge facing all industry participants includes technology access, implementation and integration. Today's discerning consumer is expecting more from less. More content in the form of in-car communications, audio capability, passenger comfort and occupant safety is critical. Consumers will also be expecting less, such as vehicles with smaller mass that consume less fuel with lower carbon footprints.

China's vehicle manufacturers knew long ago that beyond fruitful associations with global vehicle makers to understand how to design and build the vehicle, the key to success abroad is the seamless integration of state-of-the-art technology through relationships with Western component suppliers.

Demands from the ever-discerning global consumer coupled with stiffening safety, fuel economy and emissions regulations from various governments create additional hurdles for success in tomorrow's market.

Rising Corporate Average Fuel Economy (CAFE) standards in the U.S., preparation for Euro VI emissions standards midway through the next decade and the implementation of new emission standards in other jurisdictions place new importance on powertrain technology and efficiency.

No longer can vehicle manufacturers build outdated products for several years without a substantial update.

Globalization

Several factors are propelling the shift to high-volume global platforms. A platform is the structural basis that can support several body styles and nameplates.

A single platform can form the basis of a sedan, coupe, crossover utility, a tall wagon and even a convertible.

The ability for a company such as Toyota to share component sets and build formats between the Camry sedan and the RAV4 CUV is invaluable.

Better known as global platforms and component sets, virtually every successful manufacturer utilizes global platforms to react to consumer shifts, maximize fixed production capacity and lower the cost per vehicle.

The secret to the success of the Japanese manufacturers and Volkswagen is imbedded in the ability to build several different types of vehicles from few platforms globally.

Several vehicle manufacturers are learning the lesson underscored by Chrysler in North America: do not focus on one region and spread yourself too thin between too many segments.

A major driver behind the Chinese government's recent proclamation to reduce the number of vehicle manufacturers is the goal to build strong globally competitive vehicle makers that someday will be able to effectively extend their reach beyond China. This must extend beyond exports - localization of production to key markets is part of a successful strategy.