We Predict :Financial Certaintiy for Automotive Suppliers

Financial Certainty for Automotive Suppliers

By Mark Gordon Vice President of Business Development, We Predict

The automotive industry is undergoing massive transformation. Scores of new players are entering the scene. Flashy EV companies suddenly outvalue established players. Government policies and societal pressures are shifting demand. While vehicle electrification dominates industry attention, extracting efficiencies from existing operations is as important as ever.

In daily conversations with suppliers, we hear a familiar refrain. Suppliers are concerned with unprecedented increases in responsibility to pay for warranty costs, and – after years of being pressed to do more with less – they lack the resources to defend themselves. They see no end in sight. Traditionally, this is when software can help scale existing processes. But suppliers lack the resources and bandwidth to envision, evaluate and launch new software programs.

While suppliers recognize the need for better tools, many haven’t embraced a key method to forestall warranty costs: predictive analytics. Senior managers and executives don’t always understand the benefits, focusing – misguidedly – on acquisition costs rather than cost-avoidance benefits.

We often see suppliers pressure warranty teams to negotiate lower cost recoveries rather than invest in updating operations and capabilities that would lessen and prevent warranty costs. Evidence shows this isn’t effective and doesn’t solve the root problem. Suppliers tell us this is an increasingly ineffective approach as automotive manufacturers become more aggressive in their warranty-cost recovery efforts. The trend now and into 2022 is as alarming as most suppliers can remember.

There is a solution. The solution is understanding component performance over three to five years. Understanding product issues early can minimize future financial exposure. Using our industrywide database of service records and proprietary, insurer-backed predictive analytics, We Predict helps suppliers understand the failure rates for their products over a long horizon.

We also help prioritize the scope and financial impact of each issue, to aid informed decision-making in negotiations with OEMs. Additionally, we help suppliers validate their forecasts and guarantee performance, locking in financial certainty while eliminating downside surprises.

We Predict has been delivering these capabilities to our customers for a decade. We produce industryleading predictive analytics on an enormous scale, evaluating hundreds of millions of combinations and permutations at all points in time to alert our manufacturer and supplier clients to upcoming issues. We develop a complete financial picture to help our clients understand their exposures on an extended horizon. And most importantly, industry partners, including the world’s largest reinsurer, Munich Re, back our predictions, providing suppliers full financial certainty.

The need is clear. The solutions are validated. The value is overwhelming. Now is the time to engage with We Predict.

Some guess. We know.

We Predict

Members Only Ford Town Hall

December 2 | 12:00 - 4:00 p.m. | PheedLoop

OESA is pleased to host the 16th Annual OESA Members-Only Ford Town Hall on Dec. 2, 2021, virtually via PheedLoop. The auto industry is in a constant state of disruption. Getting firsthand information from customers is vital for planning and success. Hau Thai-Tang, chief product development & purchasing officer, Lisa Drake, chief operating officer, North America, and Doug Field, chief advanced technology and embedded systems officer, Ford Motor Company, will share plans and direction for Ford Motor Company in 2022 and beyond.

Following the formal presentations, Thai-Tang and Field will participate in an interactive Q&A session to address questions from attendees.

After the Q&A session, Ford Motor Company commodity purchasing executives from the following groups will be available to network virtually with attendees one-on-one:

• Body & Exterior • Chassis • Electrical • Electrical Powertrain, Transmission and Driveline • Engine Powertrain Installation • Global Indirect (Including Manufacturing) • Interior • Raw Materials & Stampings • Supplier Diversity & Inclusion • US Indirect (IT, Marketing, Services, Transportation, Construction)

OESA members that are current and prospective Ford Motor Company suppliers and those interested in learning more about Ford's strategic plans are encouraged to participate this annual event.

Register for OESA events at www.oesa.org. For registration assistance, contact OESA at info@oesa.org.