Magna-Steyr: The only brand-independent service provider in the automobile industry

Résumé:

In contrast to the electronic industry, where contract manufacturing and outsourcing of R&D is almost the common business model of the brand manufacturers of mobile telephones and computers, contract manufacturing in the automobile industry has at no time been perceived to be a real alternative form of production by the brand manufacturers. Therefore the few European contract manufacturers (Karmann in Germany, Heuliez in France, Valmet in Finland, Pininfarina and Bertone in Italy as well as Magna-Steyr in Austria) were mainly utilized for small lot production of niche models like for instance cabriolets or SUVs. In the aftermath of the financial crisis of 2008, Karmann and Heuliez filed for bankruptcy, while Bertone and Pininfarina are struggling to survive by mainly relying on their competence in automobile design, and Valmet, having lost the production of the Porsche Cayman and Boxter models to the former Karmann manufactuirng plant in Osnabrück, which is now managed by Volkswagen, is trying to acquire new orders from other manufacturers.
Only Magna-Steyr, a part of Magna Interantional, one of the largest automobile supply part manufacturers, is still doing quite well and is producing a variety of models for different brand manufacturers in quite large numbers.
The paper will outline the business model of Magna Steyr, a company that has more than 100 years of history in automobile production, and explore opportunities of new business chances in the quickly changing automobile industry like for instance the development of technology and car production for automobile manufacturers from developing countries eyeing at the European market.
The paper is based on intensive study of company materials as well as on widespread interviews, conducted at the company’s headquarter in Graz, Austria.