The auto industry is facing the greatest upheaval in its history

Horst Binnig, CEO, Rheinmetall Automotive

Over the next five years, the automobile industry will undergo greater changes than over the past 100. New business models of urban mobility, the spread of interconnectivity and the greater use of electro-mobility – these are transforming our world. The auto industry is facing the greatest upheaval in its history. It must rise to the challenges if it is to continue to play a key role in the mobility of individuals. And this is only possible through a concerted effort by all concerned. Drive system electrification alone covers such a variety of factors that it is impossible for a single manufacturer or supplier to handle it with their own resources - especially since the mainstream of future drive system technologies is not yet clearly identifiable.

Although there is still great uncertainty as to what degree electric drive systems will be gaining ground in the PHEVs or BEVs of the future, one thing is clear: hybridisation and electro-mobility will redefine the classical relationship between manufacturers and their suppliers – if only for technical reasons. Added to this are the shorter and shorter development cycles, especially where new technologies are concerned. They call for well-functioning technical interlinkage at all levels between the various parties. What's more, hybrid and battery-powered vehicles entail in themselves a large number of new vehicle components and thus, inevitably, a redefinition of the supply chain. But there are far more rewards than risks: if I take a look at the products we currently supply for the purpose of optimizing the drive train on an I.C. engine and compare these with what we currently have in our development pipeline for future types of drive systems, I arrive at a substantial growth in value: this could be almost double our share of sales per unit.

As early as 2020, electrification will account for over one-half of our sales, comprising electric parts for I.C. engines as well as components for hybrids and electric cars. There is no reason to regard electro-mobility with suspicion or even hostility. It will help our industry move forward if we are able to master the challenges ahead. Completely new opportunities will open up of which we have no notion now.