Three questions for Fathi Tlatli

Fathi Tlatli – President, Global Auto-Mobility Sector, DHL

1. How is the automotive industry recovering from the shock of the coronavirus crisis?

On the production side, things are looking much better than just a few months ago. From a period earlier in the year, when 80% of car plants were closed, we have seen a phased restart beginning in China and moving around the world. Nowhere is yet up to full capacity, but it is clear that the industry is moving in the right direction. Now we need to see whether the recovery in demand is sustained over the coming months.

2. Will the pandemic change the direction of the sector?

I expect that it will be more a question of pace than of direction. We have already seen that demand for electric and hybrid vehicles has been affected less than demand for combustion engines. The shift in powertrain technology was already underway before the crisis, but it might be accelerated now, especially as many of the most exciting, upcoming product launches are alternative energy vehicles. Carmakers will want to manage their resources carefully in the coming months and invest in the areas where they expect the strongest growth over the long term.

3. Are companies altering their supply chain plans?

A crisis always brings risk and volatility to the top of the agenda, and this crisis is no different. But in many ways, I believe the pandemic has shown that today’s automotive supply chains are already very flexible and responsive. The industry is built on continuous improvement, however, so I’m sure there will be some further measures taken, notably some more nearshoring and efforts to make the supply of critical components more robust. We may also see greater collaboration between participants across the supply chain, as everyone looks to improve resilience while keeping costs under control.

Published: December 2020

Image: DHL