How automotive manufacturing hubs drive resilience in a geopolitically disrupted world

Manufacturing hubs are increasingly vital to the automotive industry. Such hubs have been on the rise in recent decades as part of a general shift toward geographic concentration of manufacturing facilities, skills, and suppliers, driven by regionalization and the need to navigate tariffs.

Today, automotive manufacturing hubs have evolved from operational constructs into strategic assets. In an era of geopolitical fragmentation, companies that treat hubs as ecosystem orchestration platforms – rather than as mere collections of plants and suppliers – will outperform peers on resilience, innovation speed, and capital.

This blog article illustrates the business value of automotive manufacturing hubs, discusses why they are currently underused, and explains how to get the best out of them. We also relate hubs to our ongoing discussion of intelligent manufacturing solutions for the automotive industry.

How are automotive leaders using manufacturing hubs today?

One global OEM has shifted its North American operation away from maintaining one-to-one relationships with plants and toward orchestrating them all as a single ecosystem. Its sites no longer operate as isolated factories – and nor do its Tier 1 and 2 suppliers. Instead, the OEM treats all these entities as one regionally synchronized manufacturing hub. As a result, the entities benefit from common standards, talent, data, and investment approaches.

In Europe, automakers are utilizing manufacturing hubs to help them adapt their business strategies for today’s pressured and unpredictable business environment. For instance, a German OEM has been using a hub centered on its headquarters to consolidate operations and manage risk, as it shifts its focus from global expansion to industrial depth in Europe.

As a result, it has been able to rapidly rebalance production, while managing risks in areas such as sourcing policy, including emergency dual sourcing. The hub is also helping the OEM to deal with other industry issues such as short-term cost inflation and the prospect of capital-heavy reshoring – considerably improving its profitability outlook.

German OEMs are also using regional manufacturing hubs to streamline EV battery production. Two models are emerging: co‑located battery ecosystems within Germany, and near‑shore battery hubs in Eastern European locations such as Poland that support 24‑hour delivery while complying with Europe’s ADR hazardous goods regulations.

In both cases, the regional approach supports traceability in line with Europe’s battery passport requirement, effective from February 2027, while reducing geopolitical and transport risk, improving service levels, and leveraging established capabilities and infrastructure.

Why are automotive manufacturing hubs still underutilized?

Clearly, hubs are now a crucial tool for automakers, not least for increasing resilience in the face of geopolitical and economic uncertainty. Yet many current hubs fall short, for several reasons.

1. Boundaries between roles across the value chain are blurring

OEMs are increasingly engaging directly with Tier 2s, particularly where they supply crucial components such as semiconductors and batteries. Most common at times of disruption, this direct engagement can create friction within traditional Tier 1 structures.

2. Competition is replacing collaboration

Partly as a result of this blurring of role boundaries, ecosystem participants increasingly tend to see themselves as competitors, rather than as collaborators. They therefore often optimize locally, even when system‑level outcomes will suffer.

3. Collaboration infrastructure is inadequate

Collaboration across a hub – along with intelligent manufacturing, efficient product development, and supply chain resilience – depends on cross‑company data continuity. Unfortunately, that type of continuity remains rare.

How can automakers kickstart effective collaboration around manufacturing hubs?

What can companies do to ensure that they get the best out of their hubs? Free trade agreements are part of the answer, but these are beyond individual companies’ control.

What each company can do – starting today – is to adopt more effective and flexible approaches to collaborating around hubs. We recommend the following steps.

1. Define your winning strategy for using manufacturing hubs

Below we present a decision framework that can help automotive company leaders formulate strategy for each of their manufacturing hubs.

By adopting this decision framework, companies can ensure that their hub design balances local flexibility and resilience against global scalability and efficiency, and maximizes their ability to cope with geopolitical disruption.

When strategizing around hubs, it is important to recognize variation between regional requirements. For example, hybrid-heavy regions such as North America will benefit from flexible hubs, while EV-dominant regions like China and parts of Europe require deeper battery and electronics integration inside the hub. However, global standards should be implemented across all hubs.

2. Ensure essential enablers of collaboration are in place

Companies must put in place the IT elements needed to support collaboration, starting with intelligent manufacturing platforms. They should establish appropriate shared data models and semantic layers and ensure partners can access them readily, yet securely. Finally, the workforce must be upskilled so that it can operate effectively within a hub-based collaborative model.

3. Confront the new realities of collaboration

Given the shifting role boundaries mentioned earlier, automakers should accept that collaboration is now ecosystem-led, not OEM-centric, and use this fact to their advantage. We are already seeing OEMs acting as platform orchestrators, and Tier 1s repositioning as innovation and co-engineering partners.

Instead of following the familiar supply chain model, it may be more productive to think in terms of collaborating with the most relevant ecosystem partners for a given task. Ultimately, the concept of tiers may become irrelevant.

In addition, different collaborative models may be needed for each product or regional requirement. Intelligent manufacturing platforms can provide the required flexibility.

4. Reframe intelligent manufacturing as a strategic control plane

The current view of these intelligent manufacturing platforms as “enablers” is due for an upgrade. Today, these platforms are fast becoming a vital control plane for ecosystem orchestration, essential for visibility, governance, and rapid reconfiguration across hub participants.

How can Capgemini help you derive strategic advantage from manufacturing hubs?

Capgemini is ready to help you optimize your approach to collaboration around manufacturing hubs. We offer practical approaches and solutions for all of the steps outlined above, working with you to, for example:

• Define your strategic approach to hubs using the decision framework shown earlier
• Design hubs around regional product strategies (e.g. EV‑led, hybrid‑led, ICE‑led)
• Assign explicit specializations to hubs (e.g. battery modules, power electronics, mixed‑model assembly)
• Enforce global standards at hub level, not plant level

Capgemini supports automotive leaders in transforming manufacturing hubs into orchestrated ecosystems. The table below summarizes some of our offers and services in this area.

Ready to turn manufacturing hubs into a strategic advantage?

We help automotive leaders design, orchestrate, and scale manufacturing hubs powered by intelligent manufacturing platforms – driving resilience, speed, and long‑term value.