Study: Automotive Suppliers 2017 - Page 12

12 Strategic imperative: Defy cost pressure by optimizing your manufacturing footprint OUR APPROACH EXAMPLE: SUSTAINABLY LOWER COGS WITH FOOTPRINT CONSOLIDATION/SHIFT Apply detailed scenario planning to set up a target operating model by analyzing different scenarios, including variations in timing, site shifts, and implementation models 100% SITE SCENARIO PLANNING (CASE EXAMPLE) Simulate communication strategies with OEMs, including handling of production part approval processes, aid payments and long-term commitments by using goetzpartners’ “intelligent wargaming” based on noncooperative game theory Implement operational excellence through pragmatic roll-out planning and KPI tracking (considering random failures), as well as goetzpartners advisory with respect to local specifics and regulations 82% 11% 7% COGS SG&A (incl. R&D) EBIT Typical average P&L structure of automotive supplier CHANGE IN PRODUCTION FOOTPRINT SPECIFIC CHALLENGES FOR AUTOMOTIVE SUPPLIERS Toolshop Automotive radar Manual labor intensive production Transfer of dash board production Relocation of cable harness production Existing obligations to OEMs (e.g. OEM approval) Hidden costs in target regions (e.g. EE, Asia) Negative impact on running organization Complex integration in existing IT landscape • Shift of belt guide production • Integrate tool manufacturing Source: goetzpartners analysis