Sustainable and profitable growth in the automotive industry : Positioning Van Leeuwen Precision in the automotive industry

Blokvoord, R.AG. (2007) Sustainable and profitable growth in the automotive industry : Positioning Van Leeuwen Precision in the automotive industry.

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Abstract:In the 1970's the vehicle manufacturers (OEM’s) relied heavily upon their captive, in-house parts manufacturing operations for as much as 70% of their requirements, but were beginning to buy increasing quantities of products from outside suppliers. Potential suppliers gained “build to print” contracts for an agreed quantity, price and time. During the last thirty years supply chain management grew extremely important. Of course the main reason for this was to control total costs, and hereby increase revenues, in different stages of the supply chain. The OEM’s supply chain then was, and still is, divided into three to four distinct layers. These layers are called tiers. This static tier-model of the automotive supply chain is beginning to be outdated and recently is replaced by a more dynamic supply chain model. Focus is more and more on the integration of the product with other products in the supply chain, described as ‘module’, ‘system’, ‘component’ and ‘raw material’. Some suppliers are willingly taking on the new responsibilities offered to them by the OEMs, transforming themselves into “Tier One-Half systems integrators,” that engineer and build complete modules and assume both product design and development responsibilities and downstream supply chain management functions previously undertaken by the OEMs. Consequently, other firms are choosing not to pursue this new role, consciously deciding to remain in the less demanding tiers. Suppliers already develop and build 65% of the average vehicle; this share is expected to increase to 77% over the next decade. Because of the time available for this study, a segmentation is needed to construct segments in this automotive industry. Then, these segments are scored according to their potential for VLP based on a quick scan. This quick scan must comprise several criteria that are important to VLP. At forehand, the scores of these criteria most favourable for VLP must be listed. Then, a preferred profile can be constructed for VLP.
Item Type:Essay (Master)
Clients:
van Leeuwen Precision
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/488
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