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Elm Analytics - Automotive Supply Chain Risk Digest #294 - September 23 - 29, 2022

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Automotive Supply Chain Risk Digest

September 30 · Issue #294 · View online

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


CLOSING
Due to supply interruptions, Toyota is shutting down and possibly selling its plant in Moscow, Russia.
DISASTER
Mercedes and Volvo’s plants near Charleston, South Carolina, closed due to Hurricane Ian’s potential impact.
HUMAN CAPITAL
GM is partially walking back the return-to-work policy it unveiled a week ago. Many of the company’s salaried employees were “completely blindsided by this news.”
French Stellantis workers will receive a $1k-$1.3k bonus due to the increasing impact of inflation.
INDUSTRY DIRECTIONS
This week, Porsche’s IPO brought in $9.3B. VW is now better positioned to weather the transition costs to EVs.
Jaguar Land Rover is asking its supply base of over 5k companies to commit to emissions targets as part of the automaker’s goal to reach net zero emissions by 2039. They have asked their suppliers to create a decarbonization pathway, then report and demonstrate progress towards their targets.
AAA’s Automatic Emergency Braking (AEB) tests have shown that while it works well at preventing low-speed rear-end crashes, it fails at stopping average-speed crashes such as T-bones. The technology was first rolled out 20 years ago and is a requirement for all new vehicles as of September 2022.
MERGERS, VENTURES, ACQUISITIONS
GM is investing $760M into its powertrain plant in Toledo, Ohio, to build drive units for electric trucks.
Ford is investing $700M into its Kentucky Truck plant in Louisville, Kentucky, to retool it.
Russia’s Sollers is looking to buy Mazda’s stake in their Russian joint venture in Vladivostok.
Volkswagen’s EV battery subsidiary PowerCo is forming a new JV with Umicore to produce battery precursor and cathode material in Europe. The new plant will start production in 2025 and supply PowerCo’s battery plant in Salzgitter, Germany.
OPENING
Ford has broken ground on its new $5.6B EV mega-campus in Stanton, Tennessee. The site will include vehicle and battery assembly, battery recycling, and host supplier facilities.
Factorial Energy is building a solid-state EV cell development and manufacturing facility in Methuen, Massachusetts. The company is currently working with Hyundai, Mercedes-Benz, and Stellantis.
PRODUCTION INCREASE
Toyota’s global production rose for the first time in five months in August by 5.6% compared to a year earlier. Nissan’s increased by 9%, and Honda’s grew by 27% compared to last August.
REGULATION
New York state announced this week that they are planning to adopt California’s 2035 ban on gas vehicles. There will be a public hearing before the rules become finalized.
Earlier this week, The US Dept of Transportation announced that it had approved the EV charging station plans for all 50 states, including Washington and Puerto Rico. Funding for the states is part of the $1T infrastructure bill passed last November.
RISK ANALYTICS
Mercedes’ foundries in Untertuerkheim, Germany, are making extra parts for gearboxes, axles, and transmission components. The company is building stockpiles in the US and China in case of a looming German natural gas shortage.
Ten percent of Germany’s automotive companies in the VDA are facing liquidity problems. Soaring energy prices have over half of its members pushing planned investments off.
SUPPLY CHAIN
Ford is holding back deliveries of up to 45k F-150s due to a shortage of blue oval and nameplate badges.
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