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Elm Analytics - Automotive Supply Chain Risk Digest #238 - August 27 - September 2, 2021


Automotive Supply Chain Risk Digest

September 3 · Issue #238 · View online

Weekly highlights of the events that impact supply chain risk within the automotive industry.

Stay current with Elm Analytics’ live map of automotive manufacturers impacted by severe weather:
The following automakers announced earnings dips and production cuts due to semiconductor shortages: Daimler, GM, Maruti Suzuki, Tata Motors.
ZKW is expanding its Silao, Mexico location. The headlamp manufacturer will add 600 employees and 377k sq ft of production area.
German supplier REHAU is investing $50M into expanding its plant in Cullman, Alabama. The expansion will create 125 new jobs.
Martinrea is investing $31M into expanding its plant in Hopkinsville, Kentucky that will create 33 jobs. The plant produces lightweight suspension components.
Porsche announced a new R&D center in Shanghai, China, and a small-scale local assembly facility with Sime Darby Berhad in Malaysia.
GM’s Toledo Transmission plant is laying off 16 permanent and 106 temporary workers. The facility is aligning production with demand for full-size truck 6-speed rear-wheel-drive transmissions.
Volkswagen has agreed to a $42M US settlement covering 1.35M vehicles equipped with Takata airbag inflators. The settlement covers rental car costs, lost wages, and childcare costs incurred by owners while waiting for vehicle repairs.
BASF and Shanshan formed the joint venture BASF Shanshan Battery Materials Co. The company will focus on producing cathode active materials for EV battery cells.
Opel has secured a $518M government grant towards its new EV battery cell factory in Kaiserslautern, Germany. Production will begin in 2025.
Electric truck company Nikola has announced a new deal with Bosch for its hydrogen fuel cell modules. Bosch will supply cells for the Nikola Tre and Nikola Two semi-trucks.
Xiaomi, a Chinese smartphone maker, has formed a new EV company. With $1.5B, 300 employees, and having recently purchased AV firm Deepmotion, it is entering a crowded market.
Environmental regulation, low production volume, and high investment costs push small automakers to partner with larger competitors on EVs.
EV battery maker SK Innovation is investing $1.04B into a new plant in China. Their goal is to increase production capacity from its current 40GWh to 200GWh by 2025.
GM will keep production of new Bolt EVs suspended until they are confident that LG Chem can supply defect-free replacement batteries. The automaker will also not repair any recalled vehicles until defect-free batteries are available.
In Xinjiang, China, five aluminum smelters have been instructed to reduce output by around 10% starting this month. The effort to stop illegal production has sent Shanghai aluminum prices to a 13-year high.
Texas’ 2021 winter storm coupled with the pandemic have plastic part supply chains suffering. High prices and dwindling supplies of resin affect manufacturers who need epoxy, nylon, polyethylene, and PVC. Analysts expect the backlog to persist for up to three years.
GM is pausing production at five of its North American plants starting next week.
Nissan extended its shutdown at its plant in Smyrna, Tennessee, through September 12. Its Aguascalientes, Mexico, plant will be close through September 5. Both plants suffered due to a microchip supplier COVID-19 outbreak in Malaysia. Nissan expects US production to be down 36% this month.
Hurricane Ida closed the Port of New Orleans, halted rail, and left lasting infrastructure damage.
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