How EVs Are Shaking The Car Parts Supplier Industry

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How EVs Are Shaking The Car Parts Supplier Industry​

Companies that make parts for internal combustion engines are facing a harsh future. Revenues for ICE cars, and fuel and exhaust systems are all expected to decline 44% through 2027. Meanwhile, for electric drivetrains and batteries or fuel cells, revenues are expected to rise 245%, according to a 2023 Deloitte Automotive Supplier Study. While the parts themselves are changing, the pie is also shrinking. An internal combustion powertrain has about 2,000 parts. EV powertrains have about 20, sometimes less. Automakers are also finding ways to more efficiently manufacture parts through methods like giga casting, pioneered by Tesla. There are thousands of parts in cars that come from companies all over the world, a whole branching supply chain of firms each dependent on the success of the others. Many of those companies are small, family owned firms, but even the large, publicly traded suppliers such as Bosch, Denso, Magna and ZF could be in trouble. The question is, will EVs kill the thousands of auto suppliers or can they find ways to pivot, consolidate or somehow stay in business?

Chapters:
00:00 — Introduction
01:52 — The shift to EVs
05:55 — Lower demand
10:19 — Volatile times
11:42 — Industry pivots

 

[Hamartia Antidote]

Also with the popularity of Tesla you have to deal with the mantra of "no part..is the best part".

They have turned to extreme minimalism in their interiors to minimize part dependencies and build complexities. Plus minimize the number of parts people can break so they don't come in often for service. Even with this they still have 10,000 parts per car.