The effect of the emergency on the Hungarian car industry.

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The effect of the emergency on the Hungarian car industry Katalin Antalóczy, MÜTF Magdolna Backtalk, IE HAS EACES 2010 semiannual meeting, Tartu, 26-28 August 2010 Monetarily bolstered by the Hungarian Rivalry Office Foundation 1 The Hungarian car industry: Performing artists
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The emergency\'s effect on the Hungarian car industry Katalin Antalã³czy, MÜTF Magdolna Sass, IE HAS EACES 2010 half-yearly gathering, Tartu, 26-28 August 2010 Financially bolstered by the Hungarian Competition Office

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Background 1 The Hungarian car industry: Actors 1. Outside claimed OEMs: Suzuki, GM/Opel, Audi, as indicated by Pavlinek (2002) Suzuki: greenfield, installed; GM/Opel and Audi: greenfield, not-inserted, changing after some time (Mercedes: greenfield, ?, beginning creation from 2012) 2. Remote claimed suppliers: e.g. Robert Bosch, Luk, Zollner, ZF, Knorr Bremse; Hungary: more specific on suppliers than on OEMs in CEE correlation 3. Hungarian possessed suppliers: some extensive (e.g. Videoton, Karsai, Hajdãº), essentially SMEs; supplying neighborhood OEMs/suppliers or remote firms (as per fares information, supplies to firms abroad is more vital) – unique accentuation on these amid the exploration

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Background 2 Crisis Hit hard, in light of the fact that for the most part suppliers are available Economic approach: Overall environment less great contrasted with other EU Specific strong measures to the business unimportant contrasted with other EU 3. Competitivenesss taking into account low expenses disintegrating in specific portions (India, China)

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Aims of exploration Who are the car suppliers? Effect of the emergency on them Their responses to the emergency, essentially locally claimed suppliers

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Method Questionnaire based meetings with driving chiefs of 13 organizations in Hungary Interview with the Association\'s president of Hungarian Automotive Suppliers Interview with the master of ITDH managing car suppliers Statistical information utilized just to a constrained degree (issues of area definition and absence of new information) Sample of organizations contorted: those were inviting which felt they took care of the emergency effectively

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Sample Hungarian or outside possessed Size Tier (both at home and through fares) 1 Foreign Large 2-4 2 Foreign Large 1-2 3 Foreign Large 1 4 Hungarian Medium 1-2 - 3 5 Hungarian Small 1 (extraordinary items) 6 Hungarian Small 1-2 - 3 7 Hungarian Medium 1 - 2 8 Hungarian Large 1-2 - 3 9 Hungarian Medium 1-2 10 Hungarian Medium 1-2 11 Foreign Medium 1-2 12 Hungarian Medium 1-2 13 Hungarian Medium 1-2 - 3-4

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Automotive suppliers Automotive suppliers in Hungary structure an exceptionally heterogeneous gathering. They vary not just in size or proprietorship. Segments P osition in the car estimation chain D iversification : For offshoots of multinationals, in light of the fact that economies of scale assumed a critical part, this generally implied that they were suppliers to various organizations. For Hungarian claimed suppliers, broadening could show itself through distinctive structures. B1. They can be suppliers to more than one organization, B2. T hey can do generation in more than one area, B3. T hey can create parts and segments which can be utilized as a part of numerous segments. C omplexity of the item R&D and advancement movement – not a varying variable any more among „survivors”

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Impact of the emergency Crisis agreeing with different issues of the Hungarian economy (prohibitive financial approach, loosing out in intensity contrasted with the principle contender nations and so forth.) – bigger effect No real firm went bankrupt, a couple of little ones had issues: Hungarian less differentiated SMEs with low VA and supplying one purchaser (Suzuki) hardest hit by and large around a 30 % fall in requests

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Reaction to the emergency – How to climate effectively the emergency? Distinction between remote claimed and Hungarian possessed Foreign claimed: choices taken at the headquarter, less maneouvring space for neighborhood subsidiaries, reaction to the emergency normally: cutting expenses by either laying off specialists and/or cutting wages Domestic possessed: diverse reactions, yet the principle bearing is by all accounts the same, in any case, the procedure has been started even before the emergency by a few organizations (others joined in amid the emergency)

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Handling the emergency in Hungarian claimed car suppliers (Selection predisposition) The most imperative attributes of effective organizations were the accompanying: Common reaction: Laying off individuals (esp. less talented) and/or diminish in wages and/or diminish in working hours. More fruitful methodology with longer enduring results : Increasing the capacity to offer high esteem included extra administrations or more perplexing items for purchasers, for instance through imaginative limit, enlisted or unregistered R&D action, some of the time with isolated R&D unit, or if nothing else utilizing an improvement designer, building up an own hardware store, outline unit and so on. Different methods: (Further) D iversification – in numerous conceivable faculties, e.g. supplying various firms ( point: the offer of the most essential purchaser ought not surpass 25-30%), or supplying numerous items, or working in more than one division; presentation and/or change of current organization and creation association strategies, adaptability, speedy responses to changes in the earth, In a couple cases: expanded collaboration with different organizations (2 Hungarian SMEs)

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Summary „Next generation” of Hungarian nearby car suppliers with expanded participation with the purchaser organization, with offering extra administrations and higher quality included, with more (enrolled or unregistered) R&D and development exercises Even before the emergency (expanded int’l rivalry) yet for a few organizations the change was started as a reaction to the emergency, consequently the emergency animated up the procedure We couldn\'t make an estimation of the offer of this sort of organizations altogether neighborhood car suppliers We could just demonstrate that there is a significant change going ahead among locally possessed car suppliers

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