The auto industry’s next-generation vehicle platforms may allow manufacturers to produce new products at unprecedented speed, but they also will bring great challenges to manufacturers and suppliers, according to an AlixPartners study.

The so-called megaplatforms will account for nearly 90 percent of the industry’s growth in the next five years, the study released on Tuesday says.

The modular templates will allow automakers to produce millions of units spanning different global brands, models, vehicle types and sizes — even allowing manufacturers to adapt easily to local requirements and global suppliers.

“These are not your father’s platforms,” said John Hoffecker, co-president of AlixPartners in the Americas and head of the firm’s automotive practice, in a statement. “After years of striving to shed brands and to become ever more ‘common,’ well-executed mega-platforms have the potential to allow manufacturers to field more brands and models, in more geographies, and to do so cost effectively.”

To deal with overcapacity and increases in demand, automakers will more often look toward megaplatforms to produce their vehicles, the study says. Over the next five years, the number of vehicles produced on megaplatforms likely will double, and almost half of the total global production volume will be produced on the versatile platforms by 2017, the study predicts.

It’s also estimated that megaplatforms will offer significant cost savings: about 10 to 20 percent in nonrecurring costs and 4 to 8 percent in recurring costs, which could mean stripping several hundred dollars off the cost of a single vehicle, the study notes.

Automakers already have taken notice of Volkswagen’s planned MQB platform, which serves as the foundation for most of its small and medium front-wheel-drive models, according to Reuters. The study predicts that the MQB platform will top the industry in volume in 2017, with 5.3 million units. In addition to the MQB, Toyota’s MC-M, General Motors’ Delta, VW’s PQ25, and Hyundai’s PB platforms are the top five platforms expected to produce the most volume in 2017.

But Hoffecker said the implementation of megaplatforms won’t come without obstacles. Automakers will face difficulty in adapting their product-development operations and supply systems to the new systems, which Hoffecker described as “so complex they’ll make today’s already-sophisticated systems look like child’s play.”

Major risks

Another major problem? Recalls. Just one recall on a platform used by many vehicles could bring catastrophic problems, affecting many brands and models, Hoffecker noted.

Megaplatforms also could affect the volume of mergers and acquisitions in the industry, which has remained low as of late. Hoffecker pointed out that megaplatforms likely will force suppliers to globalize and become more connected.

“More and more, OEMs will be demanding things like just one bill of materials globally and true global account management, and you have to be unified to deliver on those kinds of things,” Hoffecker said.

Ultimately, automakers and suppliers will have to be careful about how they implement and maintain this high-risk/high-reward innovation in manufacturing.

“For automakers, the key to success will be to design new platforms to be super-flexible while still maintaining cost advances, and while, most importantly, focusing on execution like never before,” Hoffecker said. “Meanwhile, for suppliers, the challenge will be aligning with the ‘right’ platforms to begin with — because in this new world if you don’t put your eggs in the right basket, you may wind up with a whole lot of broken eggs — while looking for ways to maintain pricing power in the face of automakers likely asking for volume discounts.”

‘Three-speed world’

The study characterizes the global automotive industry as being in a “three-speed world,” with China, India, the United States, Brazil and Russia in “overdrive”; eastern Europe, the Middle East, Southeast Asia and Korea in “low gear”; and with western Europe and Japan in “reverse.”

Riding on decreasing unemployment, increased homebuilding and an improving credit situation, light-vehicle sales in the United States are expected to rise to 15.4 million in 2013 and 15.8 million in 2014, AlixPartners predicts.

But the study says if the Federal Reserve discontinues its quantitative easing program, the economic climate could shift, decreasing the net worth of U.S. customers and increasing interest rates, making it harder for Americans to afford to buy cars.

The outlook is also positive for China. The study predicts that China’s automotive market will increase to 29 million units in 2018 and will account for almost 50 percent of total industry growth. Production there is expected to grow to 28.8 million by 2018.

The India market also will see noticeable growth, selling 2.6 million vehicles in 2018, which would be 79 percent more than it sold in 2012, according to the study. India, Thailand and Brazil are expected to emerge as leaders in vehicle production as well.

Central and eastern Europe will see modest growth, selling about two million more vehicles in the next five years, the study says. It’s predicted that sales in western Europe will flatten, reaching a low of 12 million units in 2014 and remaining relatively stagnant for the foreseeable future.

The study says more plants in Europe are underutilized, with about 58 percent of the top 100 European plants operating below 75 to 80 percent capacity utilization, considered to be the optimal level. Italy appears to be the worst, with plants operating at 46 percent utilization on average.

As a whole, the global industry is expected to see modest growth of 3 percent in 2013 but notable growth from 2014 to 2018 — about 4 percent a year, the study says. Sales are expected to rise from 80 million units in 2012 to 102 million in 2018, and the market is expected to grow by 28 percent — 23 million units — in that time.