024 was tough, 2025 remains tough. There is news from Berylls by AlixPartners. Supplier experts Alexander Timmer and Jürgen Simon have taken a look back and ahead at the industry and in particular at the top 25 global players. Bosch and ZF are not included in the overview because the companies do not publish quarterly figures.
As anticipated in our analysis last year, 2024 began with a noticeable headwind for suppliers. The quarterly figures for Q1 to Q3 2024 confirmed the increasing challenges for the automotive industry.
And there is no short-term improvement in sight. Our experts forecast that 2025 will be as critical for suppliers as the pandemic crisis, with an increasing risk of insolvency, especially for small and medium-sized companies.
However, a look at the attached charts also shows that OEMs are also suffering from declining margins, despite a slight increase in revenue. They fell from 8.9 percent in 2023 to just 7.2 percent in 2024 – figures that suppliers are nowhere near. Their average margin in 2023 was 5.9 percent, falling to just 5.5 percent in 2024. However, many suppliers are not achieving this average, which makes it difficult or even impossible to operate profitably.
China, which remains the most important market for the automotive industry and its suppliers, is dampening business with a persistent real estate crisis and the resulting economic downturn. In future, China will not be able to maintain the high growth rates of the past and is expected to remain at an annual level of two percent, which is only slightly above the expected global growth in car sales. The threshold to stagnation therefore remains within reach here too. Above-average growth in record sales figures is a thing of the past.
The tariffs announced for 2025 on vehicles produced in China are further exacerbating the situation. At the same time, the pressure on margins in the EU for e-mobility is growing because the emission limits for new vehicles are becoming considerably stricter.
Copyright Berylls by AlixPartners
