The industry is typified by the need to gain asset productivity, often at the expense of true profitability and demand satisfaction. Cars have traditionally been pushed onto the unsuspecting market, as suppliers have used little direct information about customer demand.

All this is due to change, according to Forrester’s research. A revolution has been predicted in the shape of build-to-order (BTO) car manufacturing. Over the next four years, industry players will increasingly create a BTO information platform, allowing them to link their sales processes with their manufacturing and logistics. This should deliver substantial benefits, largely in the shift from a production-centric "push" model to a customer-centric "pull" model.

According to W. Daniel Garretson, senior analyst at Forrester, "With the ability to build vehicles to specific customer orders, the auto industry will overhaul the manufacturing mindset to emphasize customer service and satisfaction over inventory and profits over volume. The end result will not only be happier, more loyal customers, but reduced costs and increased margins, as well."

Looking further into the future, the research suggests that, by 2005, BTO purchasing will enter a hypergrowth phase. By 2010, a fifth of all vehicles will probably be built-to-order. And as BTO increasingly takes hold, manufacturers will adopt a model that increases production flexibility. Car dealers are likely to change their style of business as well, moving from pushing sales to consultancy and added value services.

The research was carried out through in-depth interviews of senior executives across the industry during 2000.