There are still pockets of opportunity in the European auto industry for manufacturers based in developing countries despite the fact that the Western European market is char¬acterized by stagnation and over-capacity, according to the Netherlands-based Centre for the Promotion of Imports (CBI).

The organization helps companies increase exports from developing countries to the" />

Issue: Dec 2013


Helping suppliers from emerging countries to support European manufacturers



by Charlita Wright




There are still pockets of opportunity in the European auto industry for manufacturers based in developing countries despite the fact that the Western European market is char¬acterized by stagnation and over-capacity, according to the Netherlands-based Centre for the Promotion of Imports (CBI).

The organization helps companies increase exports from developing countries to the European Union – especially small and medium enterprises. “Although the European automotive parts and components sector is highly competitive, with strong buyer power and intense supplier competition, it is possible for DC (developing countries) exporters to improve their position in the marketplace through increasing their technological and R&D capacities; using innovative techniques, materials and concepts in their production processes; carefully choosing their buyers; and nurturing their client relationships,” says the CBI. It points out that worldwide car sales are reaching record levels due to the development of emerging economies, and will expand further.

The share of the European market in global sales will, however, decrease significantly, from 29% in 2004 and 24% in 2012 to 20% in 2020. This will lead some European players to pursue more overseas exports, as well as look into either high-end or cheaper, entry level products, believes the CBI.

It has developed what it calls the “CBI Buyers’ Black Box,” which offers exporters and Business Support Organizations (BSOs) in developing countries a clear and up-to-date view of what goes on in the minds of European buyers when they are sourcing from suppliers in these countries.

Automotive Industries (AI) asked Cor Dieleman, CBI Senior Program Manager, Asia and Eastern Europe, how the current state of the European automotive sector affects exporters from developing countries.

Dieleman: Possibilities in the passenger cars are limited. However, looking at commercial vehicles, agriculture machinery, earthmoving equipment possibilities seem better. European companies are preparing for better times to come, which will have also impact on their suppliers.

AI: Since the automotive market in Europe is stagnating, what advice is the CBI giving suppliers based in developing nations?

Dieleman: Use the current period to improve production processes. In most cases this will result in cost savings. Let people know that you’re there. Spread the risk by exploring other applications if possible, and follow market developments.

AI: What are some of the areas in which automotive exports from DCs are growing?

Dieleman: In automotive-related field like agricultural equipment there are possibilities. Manufacturers may not be producing too much for the European market, but exports of manufactured products are doing well.

AI: What do potential automotive exporters to Europe need to keep in mind when wanting to do business in the continent?

Dieleman: It is a very competitive market. Therefore they should be well prepared. Know your own company (strengths and weaknesses), do research to find out the opportunities, plan how to approach the market, and be persistent.

AI: What is the situation for automotive exporters to some of the Eastern European countries?

Dieleman: Eastern Europe offer slightly better opportunities.

AI: How does the stringent legislation governing the automotive sector in Europe impact exporters?

Dieleman: They have to follow the requirements set by OEMs. Corporate social responsibility is another issue, so companies have to also comply in these aspects. They have to follow developments regarding mobility closely so as not to get caught by surprise. Developments include E-mobility, the move to lighter materials, the growing number of hybrids, etc.

AI: Tell us a little about the programs CBI is conducting for automotive exporters to Europe.

Dieleman: New programmes have started for Bosnia, Indonesia, Pakistan, Philippines, South Africa and Vietnam. About 25 companies in the automotive sector are participating, and another 30 in metalworking, machining and assembly. The sector associations in these countries are also involved in the programmes. They are: Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) in Pakistan; the National Association of Automotive Components and Allied Manufacturers (NAACAM) in South Africa; and the Automotive Parts Manufacturers Association (GIAM) of Indonesia.

Send your comment:
Name: Email:
Phone: Town & Country:
Comment:





























































































































































































































































Automotive Industries
THE FUTURE OF CONNECTED AND ELECTRIFIED POWERTRAINS IN VEHICLES By TE Connectivity

x

Thank You

x