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An Automotive Minute with Michael Robinet: Supplier Strategy in the BEV Age

07 May 2021 Michael Robinet

Scores of component suppliers are contemplating critical decisions with respect to the future of their organizations. GM's recent announcement of an aspirational goal of being battery electric only by 2035 has spurred several suppliers to soul search.

There are four primary choices for most suppliers given the looming structural shifts driven by electrification.

  1. Maintain course - Select suppliers may conclude their ecosystem and value equation does not change that much
  2. Double Down - though the industry is in the midst of significant secular shifts the internal combustion engine and a strong aftermarket tail will be around for several decades. Is there a play to buy up competition?
  3. Sell or partially consolidate - many suppliers may not be willing to risk their current value by shifting all or part of their organization to meet the brave new BEV future.
  4. Lastly - they can pivot. Shift to new capabilities relevant to the BEV world while still utilizing the organization's technology and process know how.

Whatever the choice, these decisions have long-term implications.

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