14th Annual Analysis of the Automotive Industry:
The 2010 Annual Automotive Study
Stars Aligned for a Robust Automotive Recovery?
A.T. Kearney’s 14th Annual Report at Townsend provides in-depth and forward-looking analysis of the automotive industry. The 2010 report is developed from analysis of 109 companies across global OEMs and suppliers.
Are the stars aligned for an automotive industry recovery?
The study asks this provocative question about the industry’s timing for recovery and delves into detail about the seven areas that led the investigative team to an optimistic answer – potentially.
Study forecasts 2010 auto sales volumes of 11.7 million
While this forecast depends on the recovery of the U.S. economy and the possibility of other wild card impacts – our base case indicates that 2010 U.S. sales volumes will reach 11.7 million and will trend back to historic levels of ~16 million by 2012. This will be driven primarily by “pent-up demand”, created during the last economic contraction. However, 3.5 million units of future pent-up demand will materialize as used vehicle sales, due to the lack of financing for non-prime buyers.
In addition, the study provides insights on other key automotive issues:
- New CAFE requirements
- Volatility of gasoline prices on small car market share
- Supply base stability as production volumes recover
- Cost advantages of global platforms and the need for scale
- Implications for OEMs and Tier 1 Suppliers
Contact
 Dan Cheng, Partner News release
A.T. Kearney's 14th Annual Automotive Study Indicates Auto Sales Volumes Will Trend Back to Historical Levels by 2012
27 May
Since 2007, approximately 20 million units of pent-up demand have accumulated – of which more than 9 million units will be recovered during the anticipated economic recovery over the next 5 years. The study's other findings include details of the "global car" where a global platform with one million units of production provides that OEM with a $700 per vhicle cost advantage.
Media highlights
Surveys of Auto Suppliers Find Hefty Profits, Rosy Outlook
11 October 2010 — Automotive News
Nearly two-thirds of suppliers expect 2010 revenue to finish at least 20 percent higher than last year, according to a global survey of 220 supplier executives by consulting firm A.T. Kearney.
Auto Loan Restrictions Slow Full Sales Recovery
21 June 2010 — WardsAuto.com
According to a recent A.T. Kearney study, tighter auto-loan restrictions continue to impede an immediate full recovery of auto sales.
Going with the Cash Flow: Grede Typifies Story of Supplier Survival
20 June 2010 - Crain's Detroit Business
Daniel Cheng, A.T. Kearney partner and head of the company's automotive practice in North America, discusses findings from the firm's recent research study that shows delays in payments from automakers to tier-one suppliers.
Fortunes Looking Up for Carmakers - Making hybrids and plug-in technologies viable for the masses
8 June 2010 - The Epoch Times
A new report by A.T. Kearney Inc., the Chicago-based management consulting firm, says that market demand, if the economic recovery stays on track, is set to explode once lenders open their pocketbooks.
Now can we have our money back?
1 June 2010 - MACLEANS.CA
The stars seem to be aligning for the entire industry more quickly than many had predicted. U.S. auto sales should reach 11.7 million new vehicles this year after hitting a low of 10.4 million in 2009, and could return to historic highs of 17 million over the next two years, according to a recent study by A.T. Kearney Inc.
Ford: 'Nothing to add' on reports of Mercury's demise
28 May 2010 - The Detroit News
Automakers are increasingly trying to shift their vehicle output onto a smaller number of so-called global platforms, according to a recent study by consulting firm A.T. Kearney.
Is 17 Million Annual Car Sales Possible?
20 May 2010 – AutoTrends.com
During the lowest point of the recession, some automotive industry analysts were declaring that the era of robust auto sales for the United States was over.... According to The Wall Street Journal, the management consultant firm A.T. Kearney, Inc. has issued a much more positive projection from 2012 and beyond even as sales are likely to climb to just 11.7 million units for 2010.
 Bullish Sales Outlook
19 May – Automotive News TV
Watch the top news story.
Global Platform Strategy to Further Industry Consolidation, Firm Says
19 May 2010 — WardsAuto.com
Despite high-profile failures such as the Chrysler Corporation-Daimler AG marriage, the cost advantages presented by mergers and partnerships will be too lucrative for most auto makers to pass up -- with cost advantages likely to come via increased use of global platforms.
AT Kearney sees 11.7 million US 2010 auto sales
18 May 2010 - Reuters
Dan Cheng, A.T. Kearney Partner and Lead of the Americas Automotive Practice, said the range from a "pessimistic" to an "optimistic" forecast for 2010 is 11.4 million to 12.3 million autos sold.
A.T. Kearney: Auto sales could hit new record by 2013
18 May 2010 - The Detroit News
Depending on how fast the U.S. economy recovers, auto sales may rebound in as little as two years to the annual selling pace above 16 million vehicles that preceded the industry's downturn, according to a new study.
Study Says U.S. Car Sales to Return to Pre-recession Level
18 May 2010 - Providers and Administrators Magazine
U.S. auto sales should reach 11.7 million new vehicles this year and may return to historic levels of near 17 million over the next two years, fueling more profitability for the more cost-efficient car companies and auto-parts makers, according to a new study reported in The Wall Street Journal.
Pent-up demand to the rescue?
18 May 2010 – Automotive News
Consumers have delayed buying cars and trucks during the recession. The average age of all light vehicles on U.S. roads was 9.8 years at the end of 2009, and will rise to 10.1 years by 2011, says consultancy A.T. Kearney. "We know cars last longer, but they don't last forever," says A.T. Kearney partner Daniel Cheng.
Firm Sees Large Rebound in U.S. Vehicle Sales in Two Years
18 May 2010 – Bloggingstocks.com
Further, this bit of good news technically isn't an economic fundamental but a forecast, but we'll take it, just the same: U.S. auto sales should reach 11.7 million vehicles this year, according to research by A.T. Kearney Inc.
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