What Suppliers bring to the OEM Value Chain
European OEMs face mounting pressure to innovate faster, cut costs, and meet aggressive sustainability targets. One of the most underleveraged tools in achieving these goals lies not within the OEM itself, but in the value chain that surrounds it. Foundries, toolmakers, and casting specialists have deep technical know-how and process experience that, when integrated early, can significantly accelerate product development, optimize costs, and deliver superior performance.
The Power of early Collaboration
During the recent Euroguss Executive Circle podcast, Katrin Grebe, managing director of Krämer & Grebe, emphasized the value of front-loading. This means inviting foundries and toolmakers into the development process from the beginning. Instead of being relegated to late-stage manufacturing support, these partners become co-creators.
“The casting process and the tool must go hand-in-hand to avoid costly compromises,” Ms. Grebe explained.
When foundries are involved early, they can identify potential issues in casting geometry, optimize tooling for quality and longevity, and propose alternative materials or processes that improve performance or reduce environmental impact. This collaborative design-to-manufacture model allows OEMs to shorten development cycles, reduce iteration loops, and improve final product quality.
Today’s foundry networks offer more than castings, they provide integrated solutions. A networks of suppliers, including toolmakers, automation providers, and material specialists, are capable of delivering full-service packages.
Rather than dealing with fragmented suppliers and misaligned production steps, OEMs gain access to aligned partnerships capable of delivering seamless solutions with fewer communication breakdowns and better project continuity.
Driving down Total Cost of Ownership (TCO)
One of the most powerful arguments for tighter OEM-supplier integration lies in a concept too often overlooked by purchasing departments: total cost of ownership (TCO).
While the initial procurement cost might seem lower when choosing the cheapest bidder, hidden costs soon emerge: machine downtime, quality problems, manual rework, logistics inefficiencies, and increased energy usage. When OEMs co-develop solutions with experienced foundries, they can design for reliability, longevity, and ease of maintenance.
As Fabian Niklas pointed out in the podcast, “A tool that works for the full 100,000 shots without having three people grinding heat cracks is worth far more than the cheapest option.”
Integrated supply chains also support OEMs’ sustainability and resilience goals. By sourcing within Europe and reducing unnecessary transport, companies cut emissions and gain more control over their timelines and quality.
Additionally, tighter supplier partnerships ensure knowledge retention, an often underestimated form of strategic capital. When OEMs rotate suppliers to chase marginal cost differences, they lose access to embedded know-how. In contrast, long-term collaborations foster innovation, continuous improvement, and shared accountability.
Conclusion
The message from the Executive Circle is clear: European OEMs can no longer afford to treat suppliers as commodity vendors. Foundries and toolmakers are key enablers of speed, innovation, and competitive strength. OEMs must transition from transactional relationships to strategic, long-term collaborations across the entire value chain to unlock their full value. Only then can Europe’s automotive sector stay agile, innovative, and globally competitive.
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