{"id":620550,"date":"2023-09-04T08:30:00","date_gmt":"2023-09-04T06:30:00","guid":{"rendered":"https:\/\/www.capgemini.com\/?post_type=press-release&#038;p=950996"},"modified":"2025-03-10T09:16:13","modified_gmt":"2025-03-10T09:16:13","slug":"with-automotive-supply-chains-stabilising-focus-on-sustainability-expected-to-rise-back-up-automakers-agendas","status":"publish","type":"press-release","link":"https:\/\/www.capgemini.com\/gb-en\/news\/press-releases\/with-automotive-supply-chains-stabilising-focus-on-sustainability-expected-to-rise-back-up-automakers-agendas\/","title":{"rendered":"With automotive supply chains stabilising, focus on sustainability expected to rise back up automakers\u2019 agendas"},"content":{"rendered":"\t\t<div class=\"wp-block-cg-blocks-hero-press-release\">\n\t\t\t<header class=\"header-hero-press-release\" role=\"main\" id=\"main-content-press-release\">\n\t\t\t\t<div class=\"container\">\n\t\t\t\t\t<div class=\"hero-press-release\">\n\t\t\t\t\t\t<div class=\"hero-press-release-content-wrapper\">\n\t\t\t\t\t\t\t<div class=\"row\">\n\t\t\t\t\t\t\t\t<div class=\"col-12\">\n\t\t\t\t\t\t\t\t\t<div class=\"header-title\">\n\t\t\t\t\t\t\t\t\t\t<h1>\n\t\t\t\t\t\t\t\t\t\t\tWith automotive supply chains stabiliSing, focus on sustainability expected to rise back up automakers\u2019 agendas\t\t\t\t\t\t\t\t\t\t<\/h1>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<div class=\"header-description\">\n\t\t\t\t\t\t\t\t\t\t<p>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"header-date\">\n\t\t\t\t\t\t\t\t\t\t<span>Sep 4, 2023<\/span>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"hero-press-release-downloads\">\n\t\t\t\t\t\t\t\t<div class=\"row\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"col-12 col-md-6 col-lg-3\">\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"download-item\" type=\"download\" href=\"https:\/\/www.capgemini.com\/wp-content\/uploads\/2023\/09\/2023_09_04_Capgemini_Press_Release_Automotive-supply-chains_CRI-Report-1.pdf\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"Opens in a new window\">\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-icon\"><\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-details\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-title\">Download press release<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-props\">137 KB  pdf<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"col-12 col-md-6 col-lg-3\">\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"download-item\" type=\"download\" href=\"https:\/\/www.capgemini.com\/wp-content\/uploads\/2023\/09\/Final-Infographic-Supply-Chain-in-Automotive-1.pdf\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"Opens in a new window\">\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-icon\"><\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-details\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-title\">Download Infographic<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"download-props\">535 KB  pdf<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/header>\n\t\t<\/div>\n\t\t\n\n\n<section class=\"wp-block-cg-blocks-group undefined section section--article-content\"><div class=\"article-main-content\"><div class=\"container\"><div class=\"row\"><div class=\"col-12 col-md-1\"><nav class=\"article-social\"><ul class=\"social-nav\"><li class=\"ip-order-fb\"><a href=\"https:\/\/www.facebook.com\/sharer\/sharer.php?=http:\/\/capgeminiucwe.develop\/?post_type=press-release&amp;p=179\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"opens in a new window\"><i aria-hidden=\"true\" class=\"icon-fb\"><\/i><span class=\"sr-only\">Facebook<\/span><\/a><\/li><li class=\"ip-order-tw\"><a href=\"https:\/\/twitter.com\/intent\/tweet?=http:\/\/capgeminiucwe.develop\/?post_type=press-release&amp;p=179\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"opens in a new window\"><i aria-hidden=\"true\" class=\"icon-tw\"><\/i><span class=\"sr-only\">Twitter<\/span><\/a><\/li><li class=\"ip-order-li\"><a href=\"https:\/\/www.linkedin.com\/shareArticle?=http:\/\/capgeminiucwe.develop\/?post_type=press-release&amp;p=179\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"opens in a new window\"><i aria-hidden=\"true\" class=\"icon-li\"><\/i><span class=\"sr-only\">Linkedin<\/span><\/a><\/li><\/ul><\/nav><\/div><div class=\"col-12 col-md-11 col-lg-10\"><div class=\"article-text article-quote-text\">\n<ul class=\"wp-block-list\">\n<li><em>Auto organisations are more confident to tackle future supply chain disruptions, having slashed backlog orders by 61%. A further 39% reduction is predicted in the next year.<\/em><\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>Nearshoring<a href=\"#_ftn1\" id=\"_ftnref1\"><strong>[1]<\/strong><\/a> strategies expected to be reinforced, driven notably by the adoption of electric- and software-defined vehicles and the evolution of regulatory and government policies.<\/em><\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>While sustainability and the circular economy are key components of the supply chains of the future, less than half of organisations have deployed initiatives in the past 12 months, and only 13% of these are being actively scaled.<\/em><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Paris, September 4, 2023 \u2013 According to the latest report <a href=\"https:\/\/www.capgemini.com\/gb-en\/insights\/research-library\/automotive-supply-chain\/?utm_source=pr&amp;utm_medium=referral&amp;utm_content=automotive_none_none_pressrelease_none&amp;utm_campaign=Auto_supply_chain-automotive\">\u201cThe automotive supply chain: Pursuing long-term resilience<\/a>\u201d from the Capgemini Research Institute, automotive organisations now feel more confident to tackle future supply chain disruptions. To achieve this, automakers have been forced to rethink, restructure, and refinance their supply chain management. While issues have been stabilised in the short-term, supply chains are still transforming due to their complexity and evolving factors: the acceleration of electric vehicle (EV) production, the new regulatory and government policies<\/strong>, <strong>and the adoption of more software-based features like ADAS (Advanced Driver Assistance Systems<a id=\"_ftnref2\" href=\"#_ftn2\"><strong>[2]<\/strong><\/a>), increasing the demand for semiconductors.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A global re-orchestration is underway as procurement from offshore<a href=\"#_ftn3\" id=\"_ftnref3\">[3]<\/a> locations fell by 22% in the past two years. Europe leads this trend having reduced offshore procurement by a quarter since 2021. This is followed by APAC and the US who have reduced offshore sourcing by 20% and 18% respectively.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The report finds that automotive organisations expect procurement from offshoring locations to reduce by a further 19% by 2025, as electric vehicle production surges and the fabrication of key electronics components relocates.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Sustainability efforts are faltering in the automotive supply chain<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Successive supply chain crises have sapped automakers\u2019 time and diverted focus and investment away from sustainability initiatives. Consequently, sustainability is not currently considered a priority for many of them, with only 37% of respondents stating that issues such as carbon footprint management and environmental risk influence supply chain decision-making. Investment across the industry reflects this trend and while OEMs\u2019 total investment in supply chain sustainability is on par with last year, suppliers\u2019 annual investment has significantly reduced by 17%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While sustainability and circularity are key components for building a more resilient supply chain and to future-proof operations, the scaling of circular-economy initiatives has been delayed due to a shortage of suppliers of recycled materials (and of the materials themselves).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Automotive organisations need to balance sustainability and circular economy with factors like cost and affordability. According to the report, digital solutions can help address this delicate balance between these various competing factors.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The creation of new supply chains for semiconductors and electric vehicles will accelerate nearshoring<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Driven by a surge in efforts to deliver software-based features and services, the average proportion of vehicle value attributed to semiconductors and sensors increased by 51% over the last two years. This is expected to increase by a further 46% between 2023 and 2025.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, only half of OEMs consider the current supply of semiconductor components as secure. Of those surveyed, 70% said the majority of supply is currently being obtained from China, Taiwan, Japan, and Korea. In a bid to achieve a greater level of supply-security OEMs are investing in alternative supply methods and moving away from tier-1 and -2 suppliers. Similarly, OEMs have secured only three years of EV battery raw materials on average.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Inventory building has stabilised but is not a feasible strategy in the long-term<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to the report, half of OEMs feel confident that they would be able to avoid 60% of the revenue loss they incurred in 2022 if the same scenarios \u2013 including the semiconductor shortage \u2013 happened again today.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">To address operational and logistic issues, both suppliers and OEMs have adopted strategies based on adding operational investment and working capital. This is led by the building of inventories, which 81% of suppliers and 44% of OEMs have implemented. However, it\u2019s clear that this is unsustainable in the long-term as holding excessive inventory risks a variety of negative effects on the operational and financial wellbeing of automotive organisations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>A lack of a data-driven intelligent supply chains impedes the automotive industry\u2019s goal for long-term resilience.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Visibility and transparency are key to create a more trustworthy supplier ecosystem \u2013 just over half (53%) of respondents have a mature intelligent supply chain in place to enable data-driven decision making, allowing for the integration of newer technologies such as AI and data analytics. With growing participation in standardised, open, and trusted data ecosystems that include new suppliers for software driven services, automotive organisations can further progress resilience and sustainability ambitions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Alexandre Audoin, Global Head of Automotive Industry at Capgemini, comments; <em>\u201cOver the past few years, organisations have been forced to restructure and refinance supply chain management on the fly in order to navigate multiple disruptions from all fronts. While in a more positive place today, automakers need to look at delivering a long-term, intelligent, and data-driven strategy that will build resilience and competitive advantage. More so, this needs to incorporate circularity as an essential component, not only to help organisations navigate regulatory changes, but to embed new players in the supply chain ecosystem and also achieve ambitious climate-targets.\u201d<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For more information or to download the report, visit: <a href=\"https:\/\/www.capgemini.com\/gb-en\/insights\/research-library\/automotive-supply-chain\/?utm_source=pr&amp;utm_medium=referral&amp;utm_content=automotive_none_none_pressrelease_none&amp;utm_campaign=Auto_supply_chain-automotive\">link to report<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Methodology<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Capgemini Research Institute surveyed 1,004 senior executives from leading global automotive organisations from across 10 different countries, during June and July in 2023. These organisations are comprised of 449 automotive OEMs with more than $1 billion in annual revenue and automotive suppliers from across 10 countries with annual revenue above $500 million. The respondents were at Director level or above, responsible for automotive organisation\u2019s supply chain strategy, sustainability, initiatives, governance, investments, and any benefits and outcomes from those. In addition, 24 in-depth interviews were also conducted with senior industry executives and experts from OEMs and suppliers to understand the current state of supply chain management in the automotive industry and to provide insights into strategies that can be applied to establish a resilient, connected, intelligent and sustainable supply chain.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>About Capgemini<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Capgemini is a global leader in partnering with companies to transform and manage their business by harnessing the power of technology. The Group is guided every day by its purpose of unleashing human energy through technology for an inclusive and sustainable future. It is a responsible and diverse organisation of nearly 350,000 team members in more than 50 countries. With its strong 55-year heritage and deep industry expertise, Capgemini is trusted by its clients to address the entire breadth of their business needs, from strategy and design to operations, fuelled by the fast evolving and innovative world of cloud, data, AI, connectivity, software, digital engineering, and platforms. The Group reported in 2022 global revenues of \u20ac22 billion.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Get The Future You Want |&nbsp;<a href=\"http:\/\/www.capgemini.com\/gb-en\/#_blank\">www.capgemini.com\/gb-en\/<\/a>&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>About the Capgemini Research Institute<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Capgemini Research Institute is Capgemini\u2019s in-house think-tank on all things digital. The Institute publishes research on the impact of digital technologies on large traditional businesses. The team draws on the worldwide network of Capgemini experts and works closely with academic and technology partners. The Institute has dedicated research centers in India, Singapore, the United Kingdom and the United States. It was recently ranked #1 in the world for the quality of its research by independent analysts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Visit us at&nbsp;<a href=\"https:\/\/www.capgemini.com\/gb-en\/researchinstitute\/\">https:\/\/www.capgemini.com\/researchinstitute\/<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p class=\"wp-block-paragraph\"><a id=\"_ftn1\" href=\"#_ftnref1\">[1]<\/a> <a href=\"https:\/\/en.wikipedia.org\/wiki\/Nearshoring\" target=\"_blank\" rel=\"noreferrer noopener\">Nearshoring<\/a>: the outsourcing of business processes to companies in a nearby country.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"#_ftnref2\" id=\"_ftn2\">[2]<\/a> An&nbsp;advanced driver-assistance system&nbsp;(ADAS) includes technologies that assist drivers with the safe operation of a vehicle. Through a human-machine interface, ADAS increases car and road safety. ADAS uses automated technology, such as sensors and cameras, to detect nearby obstacles or driver errors, and respond accordingly.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a id=\"_ftn3\" href=\"#_ftnref3\">[3]<\/a> Offshoring: the relocation of a&nbsp;<a href=\"https:\/\/en.wikipedia.org\/wiki\/Business_process\" target=\"_blank\" rel=\"noreferrer noopener\">business process<\/a>&nbsp;from one country to another\u2014typically an operational process, such as manufacturing.<\/p>\n<\/div><\/div><\/div><\/div><\/div><\/section>\n\n\n<div class=\"wp-block-cg-blocks-cg-block-related-content\"><section class=\"relatedContentBlock\"><div class=\"container\"><div class=\"row\"><div class=\"content-title col-12 col-md-8\"><h2 class=\"related-content-heading\">Related news<\/h2><\/div><\/div><div class=\"row relatedContent\"><div class=\"col-lg-4 col-md-6 col-xs-12\">\n\t\t\t\t\t\t\t<div class=\"box\">\n\t\t\t\t\t\t\t\t<a aria-label=\"Read more about Life insurers under pressure: 42% of consumers are confused and unconvinced by policies\" href=\"https:\/\/www.capgemini.com\/gb-en\/news\/press-releases\/life-insurers-under-pressure-42-of-consumers-are-confused-and-unconvinced-by-policies\/\" class=\"anchorWrapper\">\n\t\t\t\t\t\t\t\t\t<span class=\"box-tag\"><span>Reports<\/span><\/span>\n\t\t\t\t\t\t\t\t\t<div class=\"box-title\"><h3 class=\"box-subtitle\">Life insurers under pressure: 42% of consumers are confused and unconvinced by policies<\/h3><\/div>\n\t\t\t\t\t\t\t\t\t<div class=\"box-date\">\n\t\t\t\t\t\t\t\t\t\t<span>Sep 10, 2026<\/span>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t<div class=\"box-bottom\">\n\t\t\t\t\t\t\t\t\t<a class=\"link-download\" href=\"https:\/\/www.capgemini.com\/wp-content\/uploads\/2026\/09\/09_10_Capgemini-Press-Release_World-Life-Insurance-Report-2027.pdf\" aria-label=\"Download Press Release\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"Opens in a new window\">\n\t\t\t\t\t\t\t<span>Download 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href=\"https:\/\/www.capgemini.com\/gb-en\/news\/press-releases\/most-organisations-say-full-digital-sovereignty-is-an-unrealistic-goal-as-businesses-prioritise-resilience-over-total-independence\/\">Read more about<\/a>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div><\/div><\/div><\/section><\/div>","protected":false},"excerpt":{"rendered":"<p>According to the latest report \u201cThe automotive supply chain: Pursuing long-term resilience\u201d from the Capgemini Research Institute, automotive organisations now feel more confident to tackle future supply chain disruptions. To achieve this, automakers have been forced to rethink, restructure, and refinance their supply chain management. While issues have been stabilised in the short-term, supply chains are still transforming due to their complexity and evolving factors: the acceleration of electric vehicle (EV) production, the new regulatory and government policies, and the adoption of more software-based features like ADAS (Advanced Driver Assistance Systems), increasing the demand for semiconductors.<\/p>\n","protected":false},"author":376,"featured_media":0,"template":"","meta":{"cg_dt_proposed_to":[],"cg_seo_hreflang_relations":"[]","cg_seo_canonical_relation":"","cg_seo_hreflang_x_default_relation":"{\"uuid\":\"7347f5fa-277b-4eaf-a41a-abf7f24a75a0\",\"blogId\":\"\",\"domain\":\"\",\"sitePath\":\"\",\"postLink\":\"\",\"postId\":null,\"isSaved\":true,\"isCrossLink\":false,\"hasCrossLink\":false}","cg_dt_approved_content":true,"cg_dt_mandatory_content":false,"cg_dt_notes":"","cg_dg_source_changed":true,"cg_dt_link_disabled":false,"footnotes":"","related_resource_url":"https:\/\/www.capgemini.com\/wp-content\/uploads\/2023\/09\/2023_09_04_Capgemini_Press_Release_Automotive-supply-chains_CRI-Report-1.pdf","related_resource_id":951127,"related_resource_size":"137 KB","related_resource_type":"pdf","cg_author":0,"featured_focal_points":""},"tags":[],"press-release-type":[87],"brand":[],"class_list":["post-620550","press-release","type-press-release","status-publish","hentry","press-release-type-reports"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.7 (Yoast SEO v27.8) - 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