Value Chain Decisions For Tomorrow

The Deloitte study on ‘The Future of Automotive Value Chain 2025 and beyond’ calls for bold actions.

- Ashish Bhatia

Times are disruptive to the automotive ecosystem. The industry has debated this for years now with a broad consensus on the inevitability of aligning the automotive value chain. The challenge is that investment decisions have to be made today for the value chain of tomorrow. The production capacity and stability of the supply chain as per the Deloitte study ‘The Future of Automotive Value Chain 2025 and beyond’ has to be prepared well ahead of time before the actual demand arises in the global automotive markets. Among approaches and tools to support automotive decision-makers are crucial factors to drive the future value chain developments. Be it the upstream or downstream of the value chain. In the case of the former part of the value chain, from R&D to outbound logistics, the study expects massive implications for assets, people, and supply structures. Applying the approach of scenario-based business modelling: it identified four plausible setups of an Original Equipment Manufacturer (OEM) value chain expected in the year 2025. The results of these model calculations today are expected to help automotive decision makers challenge their own forecasts and strategic plans systematically. OEMs are expected to change the will significantly as the decisions taken today could have massive implications on future assets, employee numbers, and supplier structures across the automotive ecosystem. The need of the hour is bold actions from the stakeholders.

Drivers for the next decade