To find the roots of this fall in performance, we interviewed more than 30 top auto supplier executives and also held roundtable forums in both the U.S. and Europe. Our front line experts say the purchasing muscle of automakers combined with traditionalist buying practices makes justifying premium acquisition prices difficult. Larger company size and systems capability doesn't ensure profits. This means we do not get paid for delivering systems. Digestion Problems .
Current signals suggest that automotive suppliers have been running too fast.
Our work in other industries shows successful consolidators usually pause after acquisition binges-taking six to 18 months to focus on integration, reducing costs, and, most important, locating revenue synergies. But events continue to move at a relentless pace. Bigger Deals . Size complicates integration and execution speed. Acquiring Acquirers .