Reaching global markets requires big players, but those who overlook local issues may be in for a stumble.
Industry experts who participated in the Automotive News World Congress say individual markets will determine what automakers and their suppliers build and how they build it.
Rudolph Schlais Jr., president of General Motors Asian & Pacific Operations, said there is an assumption that 'like Godzilla, size does matter - that big is good.' Global platforms, product portfolios, economies of scale and engineering, and distribution efficiencies are the benefits of size, he said.
'You need to be big enough to get the volumes,' Schlais said. 'But big is bad if it means you're slow and inflexible.'
Despite proclamations of a brave, new, borderless world, he said, nationality is very important because it determines your product, your manufacturing footprint and your distribution network. 'Nationality is everything,' Schlais said.
The former president of GM China said national and cultural considerations have largely ruled out a single 'Asian car.' Vastly different roads, cultural idiosyncrasies and consumer sophistication require vastly different solutions, he said. Those who are going to win globally are those who can leverage and apply their worldwide strengths locally.
For automotive suppliers, being nimble is as important as size, said Craig Muhlhauser, president of Visteon Automotive Systems, Ford Motor Co.'s parts subsidiary. The uncertainty of the global economy, the cost pressures and the cyclical nature of the auto industry are daunting challenges, he said.
'The pace of mergers and acquisitions among supplier companies reflects our struggles' to meet original equipment global needs, he said.
The easiest course is to concentrate on North America and Europe, he said, but most economists say the global economy will become robust in the coming years.
Ricardo Martinez, administrator of the National Highway Traffic Safety Administration, said going global requires companies to be able to develop new and different relationships with new groups. They include international consumer groups, dealers, worldwide investors and shareholders, and governments.
'Going global isn't a bad word,' Martinez said, 'It's just a hard word.'
Martinez, a physician who specialized in trauma care, said the social and economic problems of motor vehicle injuries are real and are not going to go away. 'The World Health Organization predicts that motor vehicle injury will become the third-largest health burden in the world by 2020,' he said.
Industry executives will need to team up with those in government to solve national problems, he said.
Even reaching the global market presents problems, said Peter Schweitzer, president of J. Walter Thompson Co. The Internet is the only global standard, he said, but no one knows how to deal with it on a global scale.