Looking Ahead to 2022 for Automotive

Reflecting on this past year, one thing is for certain: Uncertainty ruled. From the different opinions regarding green technologies, to emerging COVID variants to lower-than-expected economic growth rates, 2021 brought us plenty of ambiguity.

Looking ahead to the future, automotive manufacturers and suppliers are eager for positive news. As we turn to 2022, some predictions seem safe to bet on.

Despite the regulatory push for EV adoption and efforts to move away from internal-combustion engines, we will see a much slower growth trajectory, especially in 2022.

The industry will have to overcome some significant hurdles next year, including overwhelming uncertainty about the supply chain and geopolitical tensions, as the U.S. becomes more reliant on overseas sources for energy and critical rare-earth minerals for EV batteries.

Many of these scarce minerals are mined in third-world countries under physically dangerous and environmentally destructive conditions.

Furthermore, optimal battery chemistry itself is far from settled, as is the looming problem of battery recycling. One company, Northvolt, has developed a battery using recycled materials, but a circular battery economy is years away.

Adding to this, American automakers are realizing it’s wise to diversify their supply chains, but this will take time. They are also dealing with growing regulatory burdens and building out the charging infrastructure and will continue to do so in 2022.

Business intelligence and digital platforms designed to connect all players within the automotive ecosystem will become fundamental in 2022.

With chip shortages affecting automotive production and sales, balancing the mismatch between strong consumer demand and constrained inventory will be top of mind among all automotive companies in 2022.

Automakers will seek better signals for detecting consumer demand so they can match production to that anticipated demand. It will be critical for them to not only capture data across the entire ecosystem, but also to extract timely and actionable insights from that data.

Visualization tools, ML-based automation and AI-enabled risk management and mitigation strategies give automakers better ways to improve supply chain execution and mitigate risk.

With advanced planning, execution and insight into demand, automakers will be able to intelligently sense and respond to value chain events in real-time.  

Automakers must add talent acquisition to their strategic agendas, or they will struggle to compete and thrive in 2022.

We’ll see a convergence of talent requirements, where “siloed skills” aren’t enough for the changing needs of the automotive industry. With innovation and disruption driving the automotive industry perhaps more than any other, automakers may struggle to keep up with the pace of change.

The automotive industry is now in direct competition with Silicon Valley for the best and brightest, and faces a shortage of properly skilled workers, including software architects and developers, data scientists and other IT professionals.

Peter Maithel (002)

It’s no longer enough for automotive employers to just offer technology courses and job-related training. To become employers of choice, automotive companies have to create a compelling employee experience by providing meaningful work as well as opportunities for employees to meet broader self-actualization needs.

Conclusion: In 2022, organizations must be prepared for the known challenges, but perhaps more importantly, for the unforeseen ones.

If there’s one thing we’ve learned over the past year and a half, it’s that we can’t take “normal” for granted anymore. Resilience, agility, adaptability and collaboration are the new coins of the realm.

Peter Maithel (pictured, above left) is automotive industry principal at Infor, a multinational enterprise software company.