The automotive industry has learned the past few weeks to walk in Goliath's shoes.
We've seen the boldface headlines for the DaimlerChrysler merger: Size matters. We've heard Daimler-Benz AG Chairman Juergen Schrempp say that, with a friendly push from Chrysler Corp., the automakers have the reach to take on everyone.
Before that, we watched interiors supplier Johnson Controls Inc. gobble up midsized Becker Group Inc. in a power play to conquer European parts business.
And we marveled at the midfield rugby scrum for the rights to plastic tubing supplier Echlin Inc. When the pile was uncovered, Dana Corp. held the ball.
It's truly been a month-long battle of the titans, a carnivorous feast right out of an old Japanese monster movie: Godzilla takes on Rodan and devours entire cities. Or, in this case, some entrepreneurial companies.
But where does that leave the other guys yet untouched by the scorched earth of the mega-mergers? Can the smaller plastic processors continue to compete in the changing auto industry? Or should they be looking at electronics, industrial goods ... anything but cars?
The experts have weighed in with somewhat scary predictions. They warn that parts suppliers must now globalize — today's most overused term — and find partners in Europe, in South America, in Asia. They say that, to compete, a supplier also must take on more engineering work, more product design, more integrated assembly.
And, while juggling all that with seamless manufacturing, cut prices by about 5 percent a year. It's enough to make a small to midsized supplier want to run for the hills.
Yet, they don't. The car business is in the blood of many of these companies. They know that a piece of the pie will always go to those who are good innovators and can stay agile. Even with some of their entrepreneurial brethren — like Becker Group and even Chrysler — swelling in size, room can be made for the second- and third-tier suppliers.
In fact, the bigger and slower some mega-companies get, the more they will seek those who can help them react quickly to change. They still need partners to come up with new products and processes. In fact, they may need them now more than ever.
To do that, a supplier now has to work with a multinational giant, which could mean traversing the globe and making common parts that will sell worldwide from Singapore to SÃŒo Paulo.
That means embracing Goliath and a complex, many-layered work environment — just as long as an entrepreneur doesn't take out the slingshot when Goliath approaches. Leave that to the gargantuan competitors stalking the same ground.
Instead, it is best to remind those new princes of the automotive jungle of their roots as smaller, hungrier companies. And of the advantages of still being a scrappy innovator instead of an industry powerhouse.
Pryweller is a Plastics News staff reporter based in Detroit.
