How do European buyers of automotive parts and components think?

The automotive industry is one of the driving forces behind globalisation. No longer is Europe the core market – this industry’s ongoing growth is being generated far from Europe’s borders. Today, the BRIC markets are pushing up demand, tomorrow it will be the ASEAN countries and soon the Middle-East and Africa are expected follow. Not surprisingly, virtually every automobile manufacturer that matters is represented in China, India, Brazil and/or Russia. Most leading international suppliers, or so-called Tier 1 suppliers, have no choice but to follow their clients and set up factories in those countries as well. They source locally or regionally, providing a huge source of business for professional newcomers. Meanwhile, European OEMs suffering from price competition are transferring the price pressure onto their local suppliers, making sourcing beyond European borders an attractive alternative – yet another opportunity for competent newcomers from DCs. A fast growing market in Europe is the aftermarket. End consumers tend to reduce the cost of ownership by using non-original spare parts when servicing their cars. This huge segment, too, offers many opportunities for suppliers from DCs. The success factors for DC exporters pursuing any of these openings – whether by becoming a player in the global supply chain, delivering to subsidiaries abroad, getting integrated as a contract manufacturer or serving the aftermarket in Europe – is reliability and a sustainable combination of excellent quality and low, fair prices.