Cramer said he expects Europe, which had car-sales of about 13.7 million last year, to remain relatively flat in 2011, but Continental still is poised to benefit.
"Even if the market grows by 3 or 4 percent, by volumes we can possibly grow by 5 to 10 percent because the installation rate for safety systems such as electronic stability control and driver assistance systems such as cameras is going up," he said.
Raw materials risks
While the suppliers are bullish, both executives are concerned about the volatility of raw material prices. Honeywell is vulnerable to cost increases for nickel, copper and steel while Cramer's division can get hit hard by big price swings for steel, gold and other materials.
Peter Tyroller, the board member in charge of sales and marketing at Robert Bosch GmbH, said another concern is the price of rare earth materials, which are crucial to hybrid car batteries. China, which is the source of almost all the world's rare earth materials, has been limiting exports, causing prices to rise. The China offer price of dysprosium hovers around $3,600 to $3,800 a kilogram, up from $300 a year ago, and neodymium is traded above $450, up from $45.
To cope with the unpredictability of raw materials price increases, currency fluctuations and natural disasters, Bosch and Continental say they are striving to be more agile.
"We need the highest flexibility because there are so many uncertainties," Cramer said.
Tyroller agreed: "We need to prepare our companies to better overcome crises in the future by probably reducing break-even points to get more flexibility. No one foresaw the crisis in Japan one year ago. All of a sudden it was there."