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Elm Analytics - Automotive Supply Chain Risk Digest #22 - July 8 - 14, 2017

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Automotive Supply Chain Risk Digest

July 14 · Issue #22 · View online
Weekly highlights of the events that impact supply chain risk within the automotive industry.

INDUSTRY DIRECTIONS
In the race to the autonomous finish line, the winners may keep their first-to-win advantage for the long haul. 
Last year alone, 195 partnerships were formed to create autonomous, connected, shared and electric vehicles. 
Automotive cyber security is a niche field that is expanding rapidly. Emerging suppliers are adding software directly to the electronic control units to stop attacks at system entry points.
LABOR DISPUTE
UAW says a petition for a union election has been filed by employees at the Nissan plant in Canton, MS. They have been working hard to unionize at the 6,000+ worker plant since 2012. The employees that filed have asked for a vote within a month.
LITIGATION
Tenneco is establishing a $132m fund to settle antitrust lawsuits worldwide. While the company has been relatively unscathed by US Justice Dept. and European Commission investigations into price fixing and bid rigging, it is facing class-action lawsuits in Michigan.
The city of Matchez, Mississippi has filed a lawsuit against its former tenant, Titan Tire Corporation. The lawsuit regards outstanding rent owed, as well as property that the city would like to recover. The plant has been abandoned since 2001, but possession wasn’t relinquished until July 1, 2017.
MERGERS, VENTURES, ACQUISITIONS
Continental AG and Osram are forming a joint venture for automotive lighting. Osram will provide parts while Continental will contribute electronic control systems. The $230m venture will employ 1,500 and is scheduled to launch in early 2018.
Silicon Valley venture capital firm Autotech Ventures says it has raised $120m for a fund that will invest in startups working on transportation services and digital vehicle tech. Its investors include BorgWarner, Autoliv and two unidentified automakers.
PLANT CLOSING
Electric vehicle startup Faraday Future has halted plans to build a $1b factory in Nevada. The automaker plans to move production of their new FF91 model in the short term while still aiming to build the plant in North Las Vegas in the long term.
FCA is permanently closing Detroit’s Conner Assembly Plant on August 31 as production of the Dodge Viper ends. FCA said it expects it will be able to offer positions to the 80+ affected employees at other locations.
PLANT EXPANSION
Cooper Standard is expanding production at its Surgoinsville, Tennessee plant, adding equipment and jobs. Coolant tube and hose assemblies, transmission oil cooling lines, and fuel and brake lines are manufactured at the plant.
PLANT OPENING
SGMW Motor Indonesia, a joint venture between GM, China’s SAIC Motor and Wuling Motors has opened their first plant in Jakarta, Indonesia. The plant which employs 3,000 will build the Confero S, a seven-seater multi purpose vehicle that will compete head to head with Toyota and Daihatsu models.
Italian supplier Eldor Corporation is on track to have a new 250,000sf plant and distribution center in Botetourt County, Virginia operational by January 2018. The plant will employ around 350 and will make products such as ignition systems, engine control units and electronic systems.
This week Faurecia inaugurated its seating plant in Rabat, Morocco and announced plans to build a new plant in Kenitra, Morocco. The site, slated to open in 2018, will produce seat covers and leather trim for Peugeot and Opel. This will be Faurecia’s third Moroccan production facility.
In other Moroccan news, Automotive World has in-depth coverage of the newly opened Renault-Nissan factory in Tangier. The plant, which produces the Sandero, Lodgy, Dokker and Logan MCV models, rolled its first vehicles off the production line in early July 2017.
PRODUCTION INCREASE
Despite slightly shrinking new vehicle sales, light vehicle production in Mexico rose 12.5% and exports increased 14% between January and June compared to the same period last year.
REGULATION
Domestic automakers and suppliers are bracing for a possible Trump administration decision to impose steep tariffs on imported steel and aluminum. While most automotive steel is sourced from the US, many specialty grades come from overseas.
Daimler AG has been accused of selling over 1m cars with excessive emissions in Europe and the US per a search warrant issued by a Stuttgart court.
Valeo is considering selling a hydraulic actuator business to Italian company Raicam. They would like European Commission regulatory clearance in a planned takeover of German clutch manufacturer FTE.
The FCC has approved allocating a larger 5Ghz block of spectrum for automotive radar. The spectrum mimics the European band and should allow automakers to deliver technologies sooner.
SUPPLY CHAIN
In the wake of rising demand for raw rubber, GM and Michelin are adopting “zero deforestation” stances in their tire procurement policies. The WWF is working to get all tire and automakers on board.
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