The Risk No OEM Sees Coming

In all the restructuring, crises, layoffs, program freezes, and boardroom fire-fighting, one risk in the German automotive industry remains almost completely overlooked:

Suppliers are starting to de-risk — and they are quietly preparing to leave.

For the last couple of years, OEMs have reduced internal staff and, in parallel, pushed development costs down to suppliers. But over the past 24 months, this dynamic has hit a breaking point.

OEMs have:

This has already caused layoffs across Tier-1s and Tier-2s — not because suppliers lack capability, but because demand has collapsed or been devalued.

But here is the part the industry still hasn’t grasped:

As automotive work becomes unstable and underpriced, suppliers are shifting their attention to industries where engineering excellence is not only appreciated — it’s compensated fairly.

Industries such as:

🚆 Transportation

✈️ Aerospace

🛡️ Defence

🚛 Industrial mobility & heavy equipment

🛰️ Space systems

These sectors offer something automotive no longer guarantees:

These industries don’t ask for the “lowest possible price.”

They ask for the best possible solution — and pay accordingly.

And suppliers are taking notice.

Right now, German OEMs are preoccupied with existential issues:

But while leadership attention is elsewhere, a silent shift is happening in the supply base:

This becomes catastrophic when you consider the next phase:

Because they will.

Demand cycles turn. Volumes return. Programs restart.

And then OEMs will turn to suppliers and say:

“We need capacity. We need teams. We need senior expertise. We need software velocity. We need to scale now.”

But what if the suppliers who used to deliver that have already left?

What if the teams are gone?

What if the expertise has shifted to industries that pay for value instead of discounts?

What if the supply base has quietly reorganized itself toward safer and more lucrative markets?

This is not a theoretical risk.

It is already happening.

What if the real crisis isn’t that suppliers are too expensive —

but that other industries value them more than OEMs do?

What if, while OEMs are negotiating the “lowest impossible price,” suppliers are already planning their exit?

What if, when the automotive market needs to scale again, the ecosystem simply isn’t there anymore?

Leadership inside OEMs is currently focused on survival.

But competing in the next decade will require more than survival instincts. It demands the courage to advance, to reinvent, to build new capabilities, not just cut cost.

And both survival and true advancement depend on one thing above all:

a healthy, committed, future-ready supply base.

Because neither survival nor innovation come from short-term savings — especially when those savings are extracted at the cost of quality.

Right now, many automotive suppliers are quietly discovering something uncomfortable for OEMs:

their healthiest future options may no longer be in automotive at all.

And may we not forget — just a decade ago, during the rise of hardware-software separation, OEMs already had to fill an innovation gap of their own making, after reducing their dependence on Tier-1 suppliers.

Are we about to repeat that cycle… but at a much larger scale?

“Nachtigall, ich hör’ dich trapsen”