PARIS - Engineering and industrial strength will continue to move into the supply chain as carmakers spend more time and effort on brands.
'We are not as efficient as we should be,' said Louis Schweitzer, chairman of Renault, at a roundtable discussion involving six top industry executives at the FISITA engineering conference. 'We see many people doing the same thing. We need a more efficient relationship with the supplier.'
Meanwhile, the executives will concentrate on customers.
'Understanding what our brand is and being consistent with the brand image' is the core business of automaking today, said Paolo Cantarella, chief executive of Fiat Group.
BMW has one of the best brand images in the industry, but BMW 'engineers don't see customers as customers,' said BMW Chairman Bernd Pischetsrieder.
'Our dealers do. For our brand identity, we must make service our first priority.'
As the automakers turn toward brands, marketing and service, they will give more business to suppliers. At the same time, the supplier community will shrink as mergers and acquisitions continue.
There are about 500 Tier 1 suppliers now, and the number could shrink 'in a few short years' to 200 or fewer big companies offering modules and systems, said J.T. Battenberg III, chairman of Delphi Automotive Systems. Delphi is the world's largest supplier, with more than $30 billion in annual sales.
Schweitzer said Renault would worry if there were only one supplier for a component, 'but I believe that if you have at least three left, you have competition.'
FISITA is a Paris-based umbrella organization for 30 national automotive engineering societies, including the SAE. A record 2,231 participants from 42 countries attended the 275 lectures and oral presentations.
Jack Schmidt, former director of GM Powertrain and FISITA's chairman from 1994 to 1996, said the organization is trying to reach beyond engineers.
European Commissioner for Economics Edith Cresson addressed the opening session. 'European citizens want the quality of air improved,' she said, and the European Union will use tax incentives to encourage 'clean cars that are competitive.'
She said the European Union's Technology Research and Development Framework Programs aim most of their research at 'improving the environment-related characteristic features of vehicles.
'In the not-too-distant future, reference standards might be developed as a possible common basis for specific tax incentives aimed at zero-degree, or very low-level, pollutant-emitting vehicles.'
Several displays on ecology and safety were open to the general public.
Cresson said global warming was not a problem unique to Europe, and there is a 'need for worldwide cooperation, between all players concerned, if we are to solve tomorrow the problems of global warming and urban pollution.'