2007 KPMG’s Auto Executive Survey.

In KPMG’s annual auto survey, many say a vast restructuring is underway. Perhaps the major reason for all this activity is big changes in what the largest and most prosperous buyer segment, baby boomers, want and value.

Globally, the auto industry’s strategies are shifting to accommodate, and benefit from, emerging markets in China, India, Vietnam, Eastern Europe, and Latin America. These regions are not only sources of low-cost labor but also growing markets themselves, particularly for small cars and trucks. And as those markets grow, the range of vehicles they need will expand.

Product quality and cost savings remain huge priorities for industry executives, but fuel efficiency now tops the list of consumer preferences.

The winners in global market-share gains will be, in this order: Chinese, Indian, and other Asian brands. The losers: North American brands.

European brands will hold their ground. The biggest likely growth areas are hybrids and entry-level vehicles, which tend to be loss leaders. Profit expectations are mixed, with a majority favoring “flat” or “volatile” over the next five years, but those predicting a decline have dropped significantly to just above those seeing a rise.

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