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Analysis Forecasts 30 Percent Reduction in Vehicle Platforms by 2020

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By 2020, the key 12 global auto OEM groups are expected to reduce their platforms from 223 in 2010 to 154, reveals news analysis by global consulting firm Frost & Sullivan. The top 10 platforms will result in a growth from nearly 17 million vehicles in 2010 to more than 33 million by 2020 in the global passenger car and light truck production figures, featuring an increase of 94 percent. Consequently, by 2020, the key 12 OEM groups are expected to account for an almost 74 percent share in the same segment, according to Frost & Sullivan.

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"With more than 95 percent of its total vehicle production by 2020 targeted from just three platforms each, Volkswagen group in the volume segment and Daimler group in the luxury segment globally are expected to have the highest degree of platform standardization and widest range of vehicle models on a single platform," says Frost & Sullivan Partner and Practice Director Sarwant Singh. "Volkswagen group is expected to surpass the current frontrunner, Ford group, with its modular toolkit strategy. The German carmaker will produce increased numbers of models and their respective volumes per platform, while efficiently integrating new and innovative technologies."

The standardization of platforms is expected to impact the OEM group brands with their vehicle model permutations, and combinations look leaner than ever before. By 2020, Daimler, Volkswagen and the Fiat-Chrysler groups respectively are expected to reduce 60 to 65 percent of their platforms. As a result, their average production volume per platform is expected to increase more than four-fold by 2020 compared to 2010. Overall, the average vehicle production per platform is expected to increase at least three-fold by 2020 from current levels of more than 0.24 million units in 2010. And, nine out of the top 10 platforms are expected to have volumes in excess of 2 million units annually by 2020, versus three out of the top 10 in 2010, according Frost.

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"Emerging Asian economies will certainly be driving platform standardization and modular approach over Europe and North America," explains Frost & Sullivan Industry Analyst Vishwas Shankar. "India and China are major drivers themselves for OEMs to strongly adopt platform standardization strategy. Approximately 160 of the 800 discrete models to be manufactured and sold globally by top 12 OEM groups between 2010 and 2020 are expected to be manufactured – and also ideally sold – in China, in comparison to 140 discrete models for the United States."

"More than 24 of these 800 discrete models, or approximately 3 percent, are global vehicle models and expected to be manufactured and ideally sold in both China and the Unites States," he added. "This clearly shows the focus on emerging economies as key to growth."

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The study also identified several factors for OEMs to derive a blueprint of their platform standardization strategy. The emerging regions in which the OEMs operate, both produce and sell, and which directly govern their platform standardization and modular strategy, are a factor, according to the research group. Another is the modules themselves used as building blocks of future platforms, and Frost says OEMs are expected to bring variations into the vehicle through effective use of electronics. And finally, there is the ability of the OEM groups to quickly understand the perceived benefits gained by having a reduced supplier base as a result of sharing components, systems and modules across platforms, according to Frost & Sullivan.

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"Global suppliers are willing to follow vehicle manufacturers and set up global facilities closer to OEMs’ final assembly lines, resulting in the reduction of discrete parts which otherwise are another cause of concern from handling just too many parts in the entire supply chain," says Shankar.

"As fewer off-the-shelf, readily available, proven components and systems from an existing supplier base lead to quicker decision making from an OEM’s point of view, avoiding time delay in developing new parts and investing in identifying these building blocks as sub-groups or modules largely form the modular vehicle platform blueprint," added Singh.

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Frost & Sullivan

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