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Roland-Berger: engineering services outsourcing into a new trend in the automotive industry





Vehicle manufacturers (OEMs) and suppliers (OESs) faced pressures are increasing. They are available through engineering services outsourcing (ESO) to increase flexibility and lower costs. Both must reduce development costs, and make full use of engineering outsourcing to increase flexibility and efficiency. Many market players have cheap engineering workforce and excellent low cost vehicle design. Their learning curve up very fast, therefore are accelerating into the high-end market and force the successful enterprises reduce project costs. Roland ・ Berger Management Consulting Co., Ltd. on the major automotive companies charge a market research, analysis of the main areas of engineering outsourcing trends and successful business operation. According to the findings of the expert to vehicle manufacturers, suppliers and engineering service provider offers comprehensive comments and suggestions.

"Due to a sharp increase in development costs, automotive vehicle manufacturer will undoubtedly develop closer cooperation in the market, and basic technology uniform industry standards," Roland ・ Berg partner, this study author Wolfgang Dr ・ the Hart (Wolfgang Bernhart) said, "you can take advantage of engineering outsourcing to control high research and development costs. "In a market downturn, whole-vehicle manufacturers trying to research and development activities in the camp, but they still need external engineering power resources to put the growing list of cars and derivatives, and handle complex new technologies.

And information technology and other industries of outsourcing, global automotive engineering services outsourcing is still an emerging trend. But its importance is growing: in 2008, automotive engineering services outsourcing market accounted for automotive research and development spending of less than 10%. Taking into account the pressures faced by the automotive industry, this proportion will be slow and steady growth, and in 2013 to about 12%, average annual growth of 4-5%. Whereas research and development expenditures are self-employed per year drop slightly 0.1%. Some areas (such as body/internal) growth rate will not be very large, the most significant outsourcing growth appears in dynamical systems and electronic/electric fields.

"Engineering outsourcing has three advantages: savings in costs and improve flexibility, access to complementary competence,"

Roland ・ Berg automotive industry Center partner Norbert ・ Dressler (Norbert Dressler) said, "in the short term, reduce the cost of engineering outsourcing is the biggest advantage. The company's external engineers can complete a simple task, fees are generally lower, and engineering services outsourcing providers to cooperate to reduce the company's fixed and development costs. "Taking into account relevant processes and coordination costs, offshore development is in the company's internal research and development cost savings of 25-35%. "However, outsourcing of engineers after the idle will not necessarily leave the company. They can join the other important projects, but those needs within the company to complete the difficult engineering projects may also make use of these resources. "This reflects the project outsourcing's second biggest advantage: flexibility. Companies can thus obtain a large number of engineering resources, and rapidly increase, decrease or adjust resources.

And engineering services outsourcing company cooperation can also gain extra competitive edge. Current trends of the electric power system is a case in point. Electric power system is the automobile companies face a major challenge. Companies must reserve a large amount of additional engineering resources, not only to complete the project of "conventional" workload, but also carry out additional research and development tasks of electrification. And engineering services outsourcing providers can solve this problem.

Vehicle manufacturers and their suppliers to develop engineering services outsourcing policy programme

Although engineering services outsourcing with these advantages, but also have many shortcomings, it is necessary to strengthen the management. Its drawbacks include: duplicate research and development activities and implied cost may result in loss of professional skills and to reduce the cost effectiveness. The company shall be the development of outsourcing and off-shore development perfection. Dressler: "the most important thing is that the car manufacturers and suppliers must clearly outsourcing projects, objects, cooperated suppliers, and get tangible benefits.

Roland ・ Berg's research illustrates successful engineering services outsourcing strategy should contain the ten initiative. Including clear and future-oriented research and development policy (in lots of engineering outsourcing) and subsequently in the global development and implementation of research and development activities. Due to cooperation with third parties will increase complexity, therefore prior explicit and streamline internal development process.

Engineering service provider should continue to improve professional skills

The study also from engineering service providers (ESPs) perspective on the market. Partner of the Harte pointed out: "non-core parts and fundamental technology further standardization as an engineering service providers brought much opportunity for them to help car manufacturers deal with complexity and increase vehicle variants will bring challenges. "However, engineering service provider must also take measures to ensure the successful development of its business. For example, engineering service provider shall, in accordance with the requirements of vehicle manufacturers, the development of specific areas of advanced technology, to form Myung

True competitive advantage. Most vehicle manufacturers that have end-to-end car production capacity, and the lack of clear expertise is not desirable. In fact, they take on this. Engineering service provider required for vehicle manufacturers and suppliers to lay down clear and integrated value proposition, and expertise to develop market entry strategies. The Hart added: "engineering service providers and their customers are clearly their respective scope of global research and development, in order to better meet the growing demand for engineering services. ”