Suppliers Need to ‘Reboot’ for Sea Change That’s Coming

While their automotive customers grapple with the technological sea change that’s coming, suppliers see opportunities for providing more value over the long haul.   

That’s the word from Mike Jackson, executive director-strategy and research of the Original Equipment Suppliers Assn. at the Center for Automotive Research’s recent Management Briefing Seminars in Traverse City, MI.

“We are in a unique situation where we have critical mass to apply to these technologies,” such as autonomous and electric vehicles, he says. “We have time but we need to reboot; we need engaged planning. We have traditionally shown we can add value.”

Nearer term, OESA sees 2017 U.S. light-vehicle sales coming in 5% below all-time record deliveries of 17.5 million in 2016.

Jackson cites a WardsAuto Intelligence forecast indicating U.S. sales between 2016 and 2020 declining 5% with trucks staying stable, SUVs up 16% and cars dipping 30%.

As might be expected, OESA members surveyed by the organization have shifted their views concerning the near future from predominantly “somewhat more optimistic” during the second quarter to “somewhat more pessimistic” during the third quarter, Jackson says.

Looking further ahead, Jackson sees car sales shrinking to 30% of the market by 2024 from 39% in 2016.