DACH Automotive Industry
10-year period of sustained growth and record results in the car supply industry has come to an end. The digital revolution, OEMs’ customer focus, and the expansion of automotive supply chains around infrastructure provision and mobility operations are all dramatically changing the economics for suppliers. Berylls has identified eight challenges to which every car supplier CEO needs to respond:
The car industry used to exercise tight discipline in its supply system, with clear structures along the whole chain, good planning reliability and solid forecasting, as well as reliable relationships. VUCA, or Volatility, Uncertainty, Complexity and Ambiguity, in today’s auto industry has resulted in massive disruption to the established supply system. VUCA forces are increasing significantly, making forecasting more difficult or even impossible. Management based on experience, stability and certainty is also made more difficult. Minor unplanned deviations can have a major impact on suppliers and lead to a chain reaction along the value creation process.
CEOs need to create an organizational and management model to reliably manage their companies against this backdrop of VUCA.
The years 2010 to 2018 were golden ones for the car supply industry, marked by sustained growth, widespread cost controls, strengthening of equity structures, solid financing and improved competitiveness. But the next five years will be very different, with disproportionally higher costs to contend with – the result of wage increases in the east, acquisitions in the west and rising prices for raw materials – alongside a reduction in productivity improvements. Financing will be more difficult, too – with higher interest rates and the car industry viewed by banks as a “crisis industry.” The period will see increased complexity in customer profiles, limitations on globalization (increasing logistics costs) and a requirement for high investment in innovation. The average EBIT margin of 8 percent for supply enterprises and 6-7 percent for medium-sized companies will shrink to around 5 percent by 2025.
CEOs need to switch to “sustained restructuring mode” to secure the operating efficiency of their highly complex value creation systems in an ever-changing world.
CASE (connected, autonomous, shared and electric) vehicle technologies are at the heart of change in mobility services. Because of their systemic interlinkages, strong functional improvement of the “mobility” product and high levels of intervention in existing solutions, their development, production and implementation are expensive and lengthy. CASE is expensive and up to now has delivered few – if any – financial improvements for companies in the car industry. This will not change in the coming decade; investments in the development of CASE technologies will run into double-figure billions. At the same time value is flowing out of the traditional profit sources, especially the internal combustion engine (ICE).
New developments by OEMs are being suspended, investments are not being made, financial resources are getting scarce. The balancing act between years of loss-making investments in CASE technologies and non-existent profits from the traditional business can no longer be managed. The losers in this development are ICE-dependent companies (which still represent 25 to 30 percent of value creation in the car industry), traditional low-tech suppliers and the typical medium-sized businesses which can no longer afford tough and risky business. On the other hand, the winners are the large enterprises (such as Bosch, Conti and ZF), car suppliers in the CASE field, new mobility start-ups and niche specialists.
CEOs need to leave behind former approaches, develop new business models to participate in the change in the car industry initiated by CASE, and at the same time tackle high numbers of fundamental innovations with long amortization times against a backdrop of faltering core businesses.
Competition in the supplier industry has always been merciless. Weak suppliers are rapidly sifted out according to the “survival of the fittest”. But this was happening within a stable economic system. The sustained and continuous development that has made the car industry and its suppliers highly innovative was based on a system in which any changes would be financed from the system itself. Innovations would be introduced into the market in small steps and skills would be built up gradually.
However, that system has now ruptured. A recent Berylls survey of 1,000 mobility start-ups shows over in the past five years, more than €180 billion has been invested in mobility venture capital. During the same period, only about half that amount was spent on investment in research and advance development for traditional automobile players.
Start-ups are looking more for disruptive innovations than revolutionary developments: a complete car from a 3D printer, cars which hover above ground, flying vehicles, zero-waste cars etc. These visionary business models coupled with absolutely “infinite” financial and intellectual resources are now clashing in a competition for the best mobility solution of the future, creating a clash of cultures with established suppliers.
CEOs need to assess two things: the risks posed to their business models by tech start-ups with disruptive approaches and the opportunities these bring from which their companies can profit.
In developed societies, the disadvantages of individual mobility are becoming more and more apparent: unsustainable use of natural resources, traffic accidents, time wasted in traffic jams and pollution (air, noise and water). The car is increasingly the scapegoat for all these problems and young people are turning away from it. Other industries and careers – and the companies associated with them – are gaining social prestige and attracting talent away from the erstwhile flagship auto industry.
CEOs need to make their companies, and indeed the whole car industry, attractive again to continue attracting the best talent.
The collaboration between OEMs and suppliers over the past 30 years has never been co-operative, marked by cost pressure, supplier-customer relations and tough competition. This is not going to change in the future. However, system-relevant players in specific areas, and in areas which are critical for OEMs, are the exception. Because of VUCA and the enormous upheaval going on in the sector, it is almost impossible for OEMs to maintain reliable and stable relationships with their suppliers. The once clear and – to a certain degree – predictable future is dissolving and reliability is declining rapidly. The result is that production start-ups are delayed, vehicle projects are suddenly cancelled, quantities are considerably less than planned, or they increase significantly, specifications are changed at the last minute, and commercial agreements are broken.
In parallel to this, completely new customer relationships are developing with tech start-ups or Asian start-up OEMs, who have little or no knowledge of the mechanisms of the car industry (and possibly do not even want to acquire any). The tectonic changes began a long time ago; Asian and in particular Chinese OEMs, combined with the Chinese automobile market – which has grown in importance because of its size – are bringing about a shift in the balance of power. China has replaced Europe, Japan or the US as the measure of all things for the car industry. Will Daimler, BMW or Audi become the Telefunken, Grundigs and DUALS of the 2020s?
CEOs need to adapt their companies to the new global balance of power when it comes to interacting with their customers.
The whole balance of power in the mobility industry is shifting to China and Asia more broadly. Every third car is produced in China. In future China will be growing twice as fast as the other core markets. In relation to future technology for e-mobility, growth and market penetration are already higher in China than in the rest of the world. There is also great willingness to invest in new OEM markets and mobility start-ups in China. Furthermore, China is buying out suppliers in hi-tech countries; takeovers of western OEMs are not excluded. State economic policy has defined the mobility industry as a key industry and is supporting its advancement. In short, China is set to become the “North Star” of key markets for OEMs. For the traditional car industry this means that they need to become more Chinese. And that goes for all aspects of their own business model.
CEOs need to bridge the gap between the build-up of skills in China and the securing of skills in the west.
The whole of the automotive value creation system is based on increasingly smooth and efficient processes: zero PPMs, JIT/JIS deliveries, simultaneous engineering, and so on. And this system has to work all over the world. Target prices for components are calculated on the basis of organizations functioning “perfectly.” The reality looks different: production start-up problems, quality costs, overtime caused by interface problems and high staff turnover in BCC countries. The majority of car suppliers have clear deficits in their business systems because, for the most part, things do NOT run perfectly.
CEOs need to establish high-performance organizations which are “best in class” at fulfilling all customer requirements, while at the same time ensuring profitability.
Our outlook in summary? The last 10 years were a piece of cake compared to the challenging agenda of the next 10.
Dr. Jan Dannenberg (1962) has been a consultant for the automotive industry since 1990 and became a founding partner of Berylls Strategy Advisors in May 2011. Until spring 2011, he worked with Mercer Management Consulting and Oliver Wyman in Munich, Germany, on international projects – for five years as Associate Partner, and another three years as Partner. He is a recognized specialist in innovation and brand management in the automotive industry, and primarily advises suppliers and investors on strategy, M&A and performance improvement. In addition he is Managing Director at Berylls Equity Partners, an investment company that specializes on mobility enterprises.
Bachelor of Arts in economics at Stanford University, USA; business administration and doctorate degree at the University of Bamberg, Germany.
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[/vc_column_text][vc_column_text]As a career starter at Berylls Strategy Advisors you can develop yourself from consultant to associate and senior associate, right up to principal and partner. An experienced expert will mentor you personally and will always be glad to see you reach the next level.
If not, we regard that as a personal decision, because, as we said, we don’t have a strict up-or-out principle. Accordingly, we have a very large midfield. This strength at the centre with our senior associates gives us a lot of know-how and strength in the teams and allows our customers to rely on excellent results the Berylls way.
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[/vc_column_text][vc_column_text]As a Partner you are responsible for the entire business relationship with one or more customers. You also represent a specific subject area of Berylls – e.g., Digital Strategy, Sales/After Sales Strategy, M&A or Organization Development. You also continue to play an important role in the daily project work: as an expert you are closely engaged with our project teams, optimally networked with the clients and their management, and you visibly bear responsibility.[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Principal you are responsible for customers and larger projects or for the management of multiple projects in parallel. You are an important liaison for our clients at their locations. You also contribute towards the business development of Berylls and to the development of new customer relationships and are responsible internally for a specific subject area.[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Senior Associate you assume responsibility as a classical project manager for whole projects and their teams. You interact closely with our customers and structure the work packages for Associates, Consultants, and interns. You are also responsible for internal tasks, e.g., in the further development of our intellectual capital.[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As an Associate you are responsible for smaller projects or individual modules of larger projects. Alongside the substantive work, you are also responsible for Consultants or interns and your initial engagement in internal task areas contributes to the further development of Berylls.[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Consultant you are responsible for individual work packages in our consulting projects. This could involve market, customer and competition researches or workshop preparations, quantitative modelling or the preparation of presentations. You will be supported from the start by experienced Berylls to ensure a steep learning curve. [/vc_column_text][vc_empty_space height=”20px”][vc_btn title=”View all jobs” style=”custom” custom_background=”#ee754f” custom_text=”#ffffff” shape=”square” link=”url:https%3A%2F%2Fberylls.jobs.personio.de%2F%23company-4330|target:_blank”][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row]
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[/vc_column_text][vc_column_text]Various entry options are open to you as a career starter at Berylls Digital Ventures. We believe in the strength of cross-functional teams to develop products, design business models, attract investors and thus sustainably improve the automobility industry. Because major challenges often demand special motivation. Our product and venture teams also perform so well because they are standing on the shoulders of all the necessary disciplines: these disciplines include venture architects and business developers who assume the business perspective, as well as technical specialists for concept, design and data science, right up to full-stack software development – all roles contribute directly to the success of our ideas. The further development within your discipline follows our clearly defined specialist track from specialist to senior specialist right up to lead specialist. An experienced colleague from the same discipline, the respective Head of Product/Ventures/CTO or a partner will mentor you personally and will always be glad to see you reach the next level. The respective requirements for your application are set out in our open job offers.
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[/vc_column_text][vc_column_text]As Partner you are responsible for the successful further development of Berylls Digital Ventures. You represent Berylls Digital Ventures with respect to our customers, cooperation partners and investors. For this purpose you have a comprehensive and robust contact network. In addition, you form the interface to other business fields of the Berylls Group.
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[/vc_column_text][vc_column_text]Within your area you are the central contact partner for our investors, customers, teams and cooperation partners. You actively pursue new business relationships and thus contribute towards the steady further development of Berylls Digital Ventures. In addition, your expertise makes you an important sparring partner for individual product or venture teams.
[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Lead Specialist, you support our teams with experience and advice, and help wherever necessary with ground-breaking professional decisions. In addition to this, you are responsible in close coordination with a Head of Products / Head of Venturing or Partner for the further development of your specialist team. With your experience, your engagement, and your integrative leadership style, you make an active contribution towards the steady further development of Berylls Digital Ventures, our products, and ventures.
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[/vc_column_text][vc_column_text]As a Senior Specialist, you are responsible within a product or venture team for all deliverables of your discipline and oversee the work of junior employees. Wherever interdisciplinary work is required, you are the first contact partner for your colleagues, and find solutions to advance your product or venture to the maximum in a professional and pragmatic manner.
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[/vc_column_text][vc_column_text]As a Specialist, you support our product or venture teams in your respective discipline. Personal initiative and independent working play a major role here from the start, which you demonstrate alone and in collaboration with an experienced colleague.
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[/vc_column_text][vc_column_text]As a career starter at Berylls Mad Media, you can proceed from Analyst to Consultant, Associate and Senior Associate up to Principal and Partner. We believe in the strength of cross-functional teams to develop our products and services and thus sustainably improve the transformation of the marketing and sales function of the automotive industry. Therefore, we offer several tracks to develop you into an expert and evangelist who is recognized as such by our customers and whose know-how is highly valued. These tracks include Customer Experience & Service Design, Data-Driven Marketing, Agile Organisational Design, Analytics & BI, MarCom as well as Tech & Architecture. An experienced colleague from the same discipline or a Principal/Partner will mentor you personally and will always be glad to continuously accompany your development.
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[/vc_column_text][vc_column_text]As a partner, you are responsible for the successful development of Berylls Mad Media. You represent Berylls Mad Media to our customers, cooperation partners, and stakeholders. For this purpose, you have a comprehensive and resilient network of contacts. As an expert, you stand for deep know-how in the field of digital transformation of sales and marketing, interacting closely with our project teams and taking visible responsibility.
[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Principal, you are responsible for the operational business of our product and service development. Within this area, you are a central point of contact for our customers, teams, cooperation partners, and stakeholders. With your industry expertise, you will be a sparring partner for the individual product or program teams and actively contribute to building new business relationships.
[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Senior Associate, you will take responsibility for entire projects and their teams. In doing so, you will interact closely with our customers within the scope of your professional specialization and lead the customer team. Additionally, you are responsible for further development within your specialization in close coordination with a Principal/Partner. Through your experience, commitment, and integrative leadership style, you will actively contribute to the continuous development of Berylls Mad Media, our products, and our services.
[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As an Associate, you will take responsibility for sub-projects, individual modules of larger projects as well as the deliverables within cross-functional teams in your subject area. Where interdisciplinary work is helpful, you are the first point of contact within your specialization and develop solutions. You take responsibility for topic areas, lead junior Berylls in terms of content and thus support the continuous development of Berylls Mad Media, our products, and services.
[/vc_column_text][vc_empty_space height=”15px”][vc_column_text]
[/vc_column_text][vc_column_text]As a Consultant, you take responsibility for individual work packages within the scope of your specialization and support our cross-functional teams in developing highly relevant solutions for our clients. You are an expert on your sub-areas and the first point of contact for experienced colleagues and customers. You will continuously develop yourself and take responsibility within the team to further develop the products and services of Berylls Mad Media.
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[/vc_column_text][vc_column_text]As an Analyst, you support our cross-functional teams and take on tasks independently. You will be supported right from the start by experienced Berylls to ensure a steep learning curve. In doing so, initiative and independent work play a major role right from the start, which you will demonstrate alone and in cooperation with experienced colleagues. You develop yourself and support the development of products and services at Berylls Mad Media.
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[/vc_column_text][vc_column_text]As a career starter at Berylls Equity Partners you can develop yourself from Investment Analyst up to Investment Director and Partner. An experienced Partner or Investment Director will mentor you personally and will always be glad to see you reach the next level. Our unique and specialized positioning also ensures, however, that we can only give a few select applicants this opportunity. We are mainly looking for hand-picked professionals with broad experience in this business. Our internal structure gives our portfolio companies and our anchor investors the certainty that we can achieve a successful financial, strategic and operative realignment.
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[/vc_column_text][vc_column_text]As Partner you are responsible for the successful further development of Berylls Equity Partners. You represent Berylls Equity Partners with respect to our customers and network partners. For this purpose, you have a comprehensive and robust contact network that you use to ensure a constantly attractive deal flow, the optimum support of our portfolio companies as well as a value-maximizing exit. In addition, you are responsible for the support of our investors, and form the interface to other business fields of the Berylls Group.
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[/vc_column_text][vc_column_text]As Investment Director you are responsible for the respective project in close cooperation with the Partner Team. You are the primary contact person at the interface to the seller or buyer side in our transactions. After a successful transaction you accompany companies during the holding period, and then ensure a successful exit process. With your engagement you contribute towards the development of new customer relationships.
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[/vc_column_text][vc_column_text]As Investment Manager you are independently responsible for larger subject areas (e.g. due diligence, company valuation, financial analysis, business plan compilation) and systematically develop into a project manager.
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[/vc_column_text][vc_column_text]As Investment Associate you are responsible for individual work packages in all our thematic areas and develop a holistic view of our investment business.
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[/vc_column_text][vc_column_text]Als Investment Analyst you support us in all areas of our investment business: in the acquisition of companies, in the strategic and operative management of our portfolio companies, and in the sale of companies.
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