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The global automotive industry is facing a technology revolution for the next step of development, according to a PricewaterhouseCoopers survey.

The international consulting firm's 17th Annual Global CEO Survey showed that about 79 percent of 87 interviewed automotive CEOs in 34 countries believed that technological advances would transform business in the next five years.

It also revealed that 57 percent of those automotive CEOs currently have a strategy in place or a program underway or completed to implement a change around technology investments.

The survey was titled Fit for growth: The automotive industry - Where it's going and how it plans to get there.

"From the purchasing process and ownership experience to in-vehicle infotainment and fuel-efficiency expectations, technological advancements are radically changing the automotive industry," said Rick Hanna, PwC's global automotive leader.

"Technology is playing a growing role within company operations and future growth. Beyond the customer, automotive CEOs are betting on advancements in technology when managing their supply chains, driving innovation, developing integrated infrastructure models and attracting talent," he added.

Chinese homegrown automobile brands saw their combined market share in the passenger vehicle segment continue the downtrend for the eighth consecutive month, as their share dropped by 2.92 percentage points year on year in May.

Analysts attributed the market environment to the lack of competitive models and technologies. "Strengthening their technology capability is the right way for homegrown brands to catch up," said independent auto analyst Jia Xinguang.

To improve technology capability to an international level, Zhejiang Geely Holding Group established a research and development center in Gothenburg, Sweden, home of its acquired Volvo brand.

Supported by Volvo, the center will help Geely develop modular-architecture designs and sets of components for C-segment cars.

A talented workforce and culture of innovation should be put in place to bring these technological advancements to fruition, the consulting firm said in the survey report.

This was one key area where automotive CEOs were notably more worried this year. The survey suggested 63 percent were concerned about the availability of key skills, up from last year's 49 percent. The demand for top science, technology, engineering and mathematics talent is becoming increasing competitive.

Nearly half of the interviewed automotive CEOs - about 45 percent - said they planned to increase numbers of employees, so there is a strong need to attract top talent. In addition, 91 percent of the CEOs said they saw a need to adapt their talent strategy in response to global trends.

Tom Linebarger, chairman and CEO of Cummins Inc, said he believed it was critical to develop local talent bases.

"In China, Cummins has more than 9,000 employees, with only about 40 expatriates, and the leadership team is, all but one, local Chinese," said Linebarger.

"We need to have a face that's local, that understands what customers want and is able to access technology and trends from that market, so, as those emerging markets grow, Cummins has the opportunity to grow with them."

The majority of automotive CEOs said they saw a need to adapt their supply chains and 20 percent had already started or completed change programs. More than half of them were somewhat or very concerned about supply chain disruption being a potential business threat.

As a result, CEOs have focused on improving regional supply-chain and logistics strategies to create an efficient flow of resources and products, including building where their customers are.

For example, China, the world's largest new vehicle market, ranked highest on the list of countries automotive CEOs considered important for overall growth prospects, followed by the United States.

"This year China once again ranked number one on the list of countries automotive CEOs consider important for their overall growth prospects," said Wilson Liu, PwC China automotive leader.

"In response, OEMs (original equipment manufacturers) and suppliers are rethinking their manufacturing and distribution strategies. Being close to customers can help offset the impact of a potential disruption," he said.

"As a result, China will become a popular destination in the next decade for global OEMs to build up their manufacturing plants, research and development centers and even regional headquarters."

Changing market dynamics and advancements in technology influences the need to invest in building infrastructure in new cities and replacing or updating infrastructure in older cities.

Automotive CEOs are aware of the challenge and 57 percent said they were concerned that inadequate basic infrastructure could threaten growth, compared to 47 percent of CEOs overall.

"Change is here and leading companies are closely evaluating every aspect of their business," said Hanna.

"Today's automotive CEOs should understand the issues at hand and address them on a much larger scale. In order have transformational growth, CEOs are taking these challenges and turning them into opportunities."

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