The Business Challenge
- The client- A renowned auto parts manufacturer
The client, one of the world’s renowned auto parts manufacturers, wanted to evaluate the relative risk in each industry and identify the growth opportunities to improve their business performance. The auto parts manufacturer wanted to gain deep-dive insights into the severity of risks based on small, medium, and large businesses. The primary objective of the client was to incorporate an entity-level industry risk assessment solution to ensure better transparency in the business processes.
The risk assessment experts at Infiniti carried out an extensive research, comprising interviews and discussions with prominent stakeholders in the auto parts manufacturing market. The experts also compiled information from reliable sources such as trade shows, paid industry databases, and company presentations to identify the impact of market challenges in the auto parts manufacturers space.
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Infiniti’s Risk Assessment Solution Benefits
The risk assessment solution offered by Infiniti assisted the auto parts manufacturer in analyzing the trends in the industry and improving their profit margins. The engagement also helped the auto parts manufacturer to assess each factor in terms of the level of risk, including intermediate and moderate risk. Moreover, the auto parts manufacturing client was able to identify risks in the supplier base and develop a temporary monitor system to monitor these risks frequently. With the help of Infiniti’s risk assessment solution, the auto parts manufacturer was able to control risks and gain early warning signals to address the potential problems in the supply chain.
Challenges for Auto Parts Manufacturers
The growing inclination towards technologically advanced products and the relentless growth in automotive production are spurring the growth prospects for the auto parts manufacturers. The auto parts manufacturing market is highly diversified with the presence of numerous competitors offering a differentiated set of products. As sales continue to shift and environmental regulations tighten, prominent auto parts manufacturers have started to re-invent their production capabilities to meet the growing demands among the end-user segments. Moreover, the auto parts manufacturers are focusing on managing rising costs while staying competitive in terms of price and profit margins.
Although the auto parts manufacturing market is witnessing promising growth, some factors may curtail the growth of the industry.
- New regulations: To improve and ensure the production of good quality road vehicles, strict regulations are being implemented, especially in terms of fuel efficiency, emissions, software, and product safety. The regulatory bodies are forcing auto parts manufacturers to include safety features that were once considered an optional add-on. As a result, auto parts manufacturers have started to rely on research and development to ensure better safety and reliability in their products.
- Modularization: With the changing preferences of the consumers, the auto parts manufacturing space has started facing the need to diversify their product lines and develop products that meet their specific needs. Moreover, the auto parts manufacturers will also face the need to manage diverse product lines with multiple product variants.