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Strategy

Our roadmap to leverage growth into higher profitability

Autoliv operates in an industry undergoing a significant transformation, driven by changing driving behavior, emission regulation, emerging technologies and evolving competitors. Our strategic roadmap, business priorities and targets are deeply rooted in the growing demand for traffic safety and a strong belief that the need for our products will continue to grow. Our leading role, developed over many years, places us in the pole position to spearhead the transformation in our industry. We aspire to position ourselves as the global leader in the wider mobility safety arena, beyond the light vehicle safety industry. In the coming years, we want to go from a solid industry leader to a true industry transformer, not just by leading, but also setting the trends in our industry. We have expanded our mission to encompass safety for mobility and society. Mobility refers to a multi-modal view of transporting people and goods, as well as related services, that go further than our traditional market of safety for light vehicles. We want to go beyond a focus on manufacturing excellence towards Business 4.0 throughout our entire value chain. We expect to make increased use of digitalization, connectivity and automation to enhance and streamline our business processes. This journey goes hand in hand with Autoliv's focus on profitable growth.

Profitable…

Volume leverage: While the recent surge in orders and product launches has required a significant organizational focus and increased engineering costs, this step-change in activity should enable us to fully leverage additional volumes into higher profitability. Upon successful completion of the current product launches, we should be able to normalize our research, development and engineering (RD&E) costs as a share of sales. This normalization will be further driven by RD&E effectiveness programs geared toward enhancing productivity, while some resources will be redirected to investments in new technology and product development areas.

Continuous improvement remains a cornerstone of Autoliv’s ongoing efforts to strengthen productivity and efficiency. In addition to enhanced RD&E effectiveness, Autoliv's production system enables us to pursue a broad agenda of continuous improvement activities across all functions including sales, operations, supply chain and support functions. To accelerate our margin expansion journey, we invest in automation and digitalization of our core business and support processes. We design for modularization to drive complexity reduction. We will review opportunities to externalize non-strategic manufacturing processes which lack a financial rationale for remaining in-house.

… Growth

In the medium term, we will continue to grow our core business – airbags, seatbelts and steering wheels – through successful execution of the current product launch programs and order book. To maintain growth momentum beyond the ongoing step-change, we are pursuing an ambitious innovation program which includes targeting several “world firsts”. Successful organic growth will also rely on driving operational excellence while providing superior quality to our customers in terms of product performance and delivery reliability prior to and after the start of serial production. We constantly review our product portfolio and optimize it from a total life-cycle perspective. We are also addressing long-term growth through opportunities in new markets and adjacent businesses. We are looking into closely related areas such as vulnerable road users (VRU), pyro-safety, commercial vehicles, digital services and seat safety modules. We intend to explore opportunities in key adjacent areas where we can leverage our technological know-how, operational capabilities and strong customer relationships.

Agile, performance-oriented culture

The successful execution of our strategic roadmap rests on the performance and quality-oriented culture at Autoliv, combined with agility in responding to sudden shifts in our circumstances, whether this means leveraging unforeseen opportunities, or addressing internal and external disruptions and challenges.

Addressing long-term growth

We have a multi-modal view that extends beyond our traditional markets. To do this we explore new markets and adjacent businesses where we can leverage our existing customer relationships and our core capabilities.