1. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Ulrich Jürgens Wissenschaftszentrum Berlin für Sozialforschung Social Science Center Berlin for Social Research
Strategies with Regard to Market, Product Innovation, Technology and Organization
Topics:
Globalization revisited
Product innovation
Industry organization
IpL/HBS European Conference „Relaunching the Innovation Rates …“

2. IpL/HBS European Conference „Relaunching the Innovation Rates …“
52 Car Makers in the World
IpL/HBS European Conference „Relaunching the Innovation Rates …“

3. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Automobile Production by World Regions (Passenger and Commercial Vehicles, 1997 and 2003, in 1000 Units)
Quelle: oica.com
IpL/HBS European Conference „Relaunching the Innovation Rates …“

4. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Forecast on Value Added Development in the Automotive Industry Worldwide* 2002 – 2015 (FAST 2015)
2002
2015
% Change
Vehicle production (million units) 57 76
33,3
Value added OEM (€ billion)
228
203
11,0
Value added suppliers (€ billion)
417
700
67,0
Value added total (€ billion)
645
903
40,0
* Automobile development/production, light vehicles
Source: Mercer Management Consulting, Fraunhofer-Gesellschaft (2003)
IpL/HBS European Conference „Relaunching the Innovation Rates …“

5. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Share of World Regions in Automotive Industry Value Added and 2015
Change: 67,3%
Change: 328,0%
Change: 259,5%
Change: 19,3%
Change: 10,6%
Change: -51,2%
Change: 17,4%
Change: 65,6%
Source: Mercer Management Consulting, Fraunhofer Gesellschaft (2003)
IpL/HBS European Conference „Relaunching the Innovation Rates …“

6. Shares of Production, Domestic vs. Abroad, of Major Car Makers (2003)
51,5%
39,0%
54,9%
76,0%
72,3%
41,9%
13,4%
45,4%
59,6%
45,2%
Source: Automotive News Data Center (autonews.com), VDA (2004): International Auto Statistics, own calculations.
IpL/HBS European Conference „Relaunching the Innovation Rates …“

7. Globalization Structure of Selected Car Makers (in Percent)
Source: Own calculations on the basis of IMF Auto Report 2004, p. 71
IpL/HBS European Conference „Relaunching the Innovation Rates …“

8. Globalization Structure of Selected Car Makers (in Percent)
NAFTA
W. Europe
East Europe
Japan
Asia/ Pacific
South
America
Africa &
New East
100
200
300
400
500
600
700
Fiat
Renault
Toyota
VW Group GM
Daimler-
Chrysler
IpL/HBS European Conference „Relaunching the Innovation Rates …“

9. Motivation for Relocation of Production Abroad
Source: Lay/Kinkel/Maloca (2003): Stand und Entwicklung der Auslandsproduktion bei Automobilzulieferern – ein Branchenvergleich. Düsseldorf: HBS, p. 18
IpL/HBS European Conference „Relaunching the Innovation Rates …“

10. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Indexed (Germany = 100) Yearly Wages/Salaries and Labour Costs per Person Employed in the European Automotive Industries 2003
Wages and Salaries
Total Labour Costs
Germany
100.0 UK
75.9
69.9
France
70.2
78.3
Sweden
66.4
77.7
Spain
55.6
59.5
Italy
49.5
57.4
Hungary
20.3
22.0
Poland
18.1
17.8
Czech Republic
16.4
17.9
Slovenia
11.8 -
Slovakia
12.9
13.9
Romania
5.6
6.2
Russia
4.0 –
Source: VDA: International Auto Statistics, edition 2004, p. 350f.; 361f., own calculations.
The average per-capita figure for wages and salaries in Germany was € 45700; for total labour costs €
IpL/HBS European Conference „Relaunching the Innovation Rates …“

11. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Use of Modern Organization Concepts by German Auto Suppliers Relocating Production Abroad
Source: Fraunhofer ISI, Mitteilungen aus der Produktionsinnovationserhebung, No. 32, March 2004, p. 10
IpL/HBS European Conference „Relaunching the Innovation Rates …“

12. Innovation Roadmap Compact Class Europe
Segments
Interior
Smart Airbags
Pedestrian protection sensors
LED head lights
Electro- nics in all seg- ments
LED tall lights
CO2 air conditioning
Pre-crash sensor system
Fully variable interiors
External network
Head-up display
Night vision
Active lighting
Object recognition
Electronic bus systems
Adaptive cruise control
42 V electric grid
Smart power distribution
Infotainment (e.g. smart navigation system)
Fuel cell as auxiliary power unit
Flat ribbon cable
Optical bus systems
High-pressure supercharged diesel
Power
train
Elektrical radiator and ventilation/cooling control
Electrohybrid propulsion
Fuel cell
Particle filter
Thermal manage- ment
Shift-by-wire
Electromechanical valve timing gear
CVT
Piezo injectors
Gasoline direct injection
Electric double clutch
Starter generator
Chassis
New materials (high-tensile steels, aluminium)
Electromech. brake (brake-by-wire)
Electromech. steering (steer-by-wire)
Electronic power- assisted steering
Air suspension
Electric parking brake
Electrohydraulic brake
Friction coeffic. recogn.
Electrical overlay steering
Product differentiation of identical compo- nents by software
Tire pressure monitoring
Active suspension
Body
Hydroforming
Steel space frame
Aluminium
Metal foam
Adhesives technology
Plastic add-on parts
Sandwich structure
Composite materials
Colors with Lotus effect
Laser welding
Color matching
2002
2005
2010
2015
Source: HAWK Study by McKinsey & Company/PTW (2003: 20)
IpL/HBS European Conference „Relaunching the Innovation Rates …“

13. R&D Costs per Car of Selected Car Makers 2003
US-Dollar
Source: Goldman Sachs (2004): Germany: Automobiles - DaimlerChrysler (DCXGN.DE)
IpL/HBS European Conference „Relaunching the Innovation Rates …“

14. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Employment Potential Through X-by-wire Systems Germany (1997 to 2002 to 2015)
System integration/
assistant systems
ABS
ESP+
Steer-by-wire
37.500
17.500
5.500
2002
2005
2010
2015
Additional
employment
Electr. hydr.
assisted steering
Electromech. steering
+3.500
+9.500
+8.000
+2.000
Sensorics, batteries, bord net,
electronics
Brake-by-wire
Initial
level 1997
EHB
ESP
Source: Jürgens, U.; Meißner, H.-R. (2005): Arbeiten am Auto der Zukunft. Berlin, p. 122
IpL/HBS European Conference „Relaunching the Innovation Rates …“

15. Emplyoment Perspectives in the Area of Powertrains in Germany
2002
2005
2010
2015
Additional
employment
Diesel injection technology
+7.000
+6.000
+4.000
European Diesel boom
(40% market share)
Diesel boom USA?
+1.000
+3.000
Fuel cell/hydrogenic
propulsion
Hybrid propulsion
(+1.600)
Initial level 1997
Innovation competition Diesel/Hybrid
Innovation competition Otto/Diesel
Gasoline direct
injection technology
Source: Jürgens, U.; Meißner, H.-R. (2005): Arbeiten am Auto der Zukunft. Berlin, p. 168
IpL/HBS European Conference „Relaunching the Innovation Rates …“

16. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Impact of a Change from Conventional Engines to Fuel Cell Systems on the Supplier Industry
Source: Wengel, J.; Schirrmeister, E. (Hg.) (2000): Innovationsprozess vom Verbrennungsmotor zur Brennstoffzelle. Karlsruhe, p. 181
IpL/HBS European Conference „Relaunching the Innovation Rates …“

17. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Some Findings of the Project “Innovation and Employment in the Automotive Industry” Project Results (I)
The intensification of innovation has positive effects on employment and competitivity
Diesel technology as European success story
x-by-wire as specialty of European suppliers
Competing technologies in various propulsion systems, light-weight materials etc. lead to a multiplication of R&D activities
We observe a technological revolution in basic technologies which, nevertheless, is implemented in an incremental way (delay/canceling of introduction dates; long periods of phase-in and phase-out)
In the mid and long term the innovation dynamics lead to drastic structural effects regards types of suppliers and division of labor OEM - suppliers.
IpL/HBS European Conference „Relaunching the Innovation Rates …“

18. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Project Results (II)
We found only weak links between innovation strategies and personnel development strategies, between technology road-maps and consequences for employees.
Cross-functional approaches (R&D and production) to discuss consequences of innovation on employment and qualification requirements were also weakly developed.
IpL/HBS European Conference „Relaunching the Innovation Rates …“

19. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Die zehn größten Automobilhersteller weltweit nach Produktionszahlen 2003 und Veränderungen gegenüber 1997
IpL/HBS European Conference „Relaunching the Innovation Rates …“

20. IpL/HBS European Conference „Relaunching the Innovation Rates …“
Company Value by Market Qualification The Top Ten Auto Companies of 2004
Toyota‘s cash and other liquid assets at the end of business year 2004: 32,7 bln. US-Dollar
Source: Börsenzeitung of ; Toyota Motor Corporation, Annual Report, March 31, 2004, SEC Forum 20
IpL/HBS European Conference „Relaunching the Innovation Rates …“