Bankruptcy
Blackstone Technology, a German division of Swiss commodities firm Blackstone Resources, has filed for insolvency. The company's declaration of bankruptcy follows months of doubt and setbacks in their plans to 3D-print battery cells. Series production never took place, and doubts have arisen regarding the authenticity of the cells presented by the company. Employees and suppliers have been waiting for payments, and investigations are underway regarding possible subsidy fraud.
Change In Management
Porsche Cars North America CEO Kjell Gruner has left the company, effective immediately. Gruner, who took over the top job less than three years ago, left "at his own request." COO Joe Lawrence and CFO Thierry Kartochian will lead the US business in the interim.
Cyber Security
The automotive industry is constantly under attack from cyber threats, particularly remote attacks, which are more common than physical attacks. In response, several regulations and standards have been implemented to enhance cybersecurity and save costs associated with developing the automotive industry. These include UN Regulations 155 and 156, ISO/SAE 21434, and ISO 26262. Meeting these standards helps to identify gaps in cybersecurity and ensures that proactive measures are taken in the design of systems. The regulations apply to all aspects of the automotive supply chain and require a systematic approach to managing cybersecurity risks. Testing and certification are crucial for achieving compliance and maintaining readiness against cybersecurity threats.
Disaster
Two firefighters died while responding to a fire on an Italian cargo ship at Port Newark in New Jersey, carrying over 1,000 vehicles. The fire on the boat, loaded with new and used automobiles destined for West Africa, spread quickly to multiple decks, making it difficult to control. Grimaldi Group, the vessel's owner, said there were no EVs or hazardous cargo aboard.
Expanding
Neapco plans to invest $59M to expand its Coahuila, Mexico facility, adding a 215k sq ft addition. Neapco specializes in the machining of cardan shafts and half shafts.
Industry Directions
Toyota is planning to release next-generation EVs in 2026, which will bring benefits beyond just their own vehicles. The manufacturing processes developed for these EVs will also be used for ICE and PHEV production, resulting in more efficient and flexible manufacturing with reduced lead times. Toyota is committed to sharing this all-electric platform with its partner automakers to accelerate the transition to electric mobility on a larger scale. By integrating EV technology and leaner production processes into their conventional vehicle manufacturing, Toyota aims to enhance efficiency, reduce costs, and strengthen its position as a leader in automotive innovation.
GM, Ford, and Stellantis are expanding initiatives to diversify their supplier networks and encourage inclusivity. Supplier networks that include minority-owned, women-owned, and veteran-owned businesses foster innovation, contribute to economic growth in marginalized communities, and make the automotive industry more resilient.
Stellantis CEO Carlos Tavares has expressed frustration over the favorable treatment of Tesla and other EV rivals by French politicians. At the same time, his warnings about the influx of cheap Chinese cars into Europe have been ignored. Tavares argues that carmakers without legacy combustion-engine assets are prioritized over those who have significantly contributed to Western Europe's economy. The cost and complexity of transitioning to electric vehicles (EVs) pose challenges for Stellantis, which oversees multiple brands and factories globally. As EV adoption accelerates, automakers face the challenge of retooling factories and managing the impact on employment. The tensions between Stellantis and French politicians highlight the complexities of the EV shift and the concerns surrounding job protection and competition.
Labor
The future of Jeep's idled assembly plant in Belvidere, Illinois, and its potential transition to EVs will depend on contract negotiations between the UAW and Detroit's automakers. Legacy automakers are looking to reduce costs to finance their rapid shift to EVs, while the UAW advocates for job protection during the transition. The negotiations are expected to be difficult, with a potential strike looming. The outcome of these negotiations will have significant implications for the future of the Belvidere plant and the broader restructuring of the US auto industry. As automakers navigate the expensive transition to EVs, balancing labor costs and job security is critical. The success of these negotiations will impact the industry's ability to adapt to the EV market and the livelihoods of workers in the affected plants.
Mergers, Ventures, Acquisitions
Stellantis and LG Energy Solution's joint venture, NextStar Energy, has finalized a deal to secure the production of battery cells and modules in Windsor, Ontario. This agreement upholds the Canadian government's commitment to supporting battery production and creating equal opportunities with the US IRA. The gigafactory, also called NextStar Energy, will resume construction and begin production in 2024, with a yearly capacity of over 45GWh.
Sweden's Northvolt is finalizing a deal to build a $5.2B electric vehicle battery plant in Saint-Basile-le-Grand, near Montreal, Canada. The governments of Canada and Quebec are expected to provide substantial financial assistance, similar to the agreement reached with Volkswagen to construct an EV battery plant in Ontario. The Northvolt project would encompass a cathode factory, battery cell assembly line, and recycling facility, positioning Quebec as a hub for EV battery production.
Opening
BASF has opened its cathode materials factory in Schwarzheide, Brandenburg. The plant is already fully booked for the next few years and aims to produce tailor-made materials for battery cells and automakers in Europe. BASF's Schwarzheide facility also includes a battery recycling plant, making it the first "co-located battery materials and recycling center" in Europe.
Mitsui High-tec plans a $77M expansion in Brantford, Ontario, Canada, adding a 103.5k sq ft manufacturing facility. The company is currently the only manufacturer of motor core parts for EVs and hybrid vehicles in Canada.
ZF Group has started mass production of advanced electronic and power-assisted driving components for its Electronics & ADAS division in Nuevo Leon, Mexico. The plant is ZF's first manufacturing project in the state, focusing on smart cameras and brake control systems.
China's BYD will invest $620M in building an industrial complex in Brazil. The complex, located in Camacari, Bahia, will consist of three plants:
An electric bus and truck chassis plant
A new energy passenger car plant
A processing plant for LFP battery materials
With a planned annual capacity of 150k units, the complex will start production in the second half of 2024 and create over 5k local jobs.
Production Increase
Several major automakers, such as General Motors, Toyota, Honda, Hyundai, and Kia, have reported substantial sales growth during the second quarter of 2023, indicating a positive trend for the industry. The easing of chip shortages allowed automakers to replenish their dealer lots, making it easier for customers to find the models they desired. Strong job creation and rising wages also contributed to the increase in sales. Nevertheless, higher interest rates and car prices have limited the demand for new vehicles. EVs continued to be a rapidly growing segment, with Rivian and Tesla reporting significant sales increases. According to Cox Automotive, over 500k EVs were sold in the United States during the first half of the year, and sales are expected to exceed 1M in 2023.
Regulation
California-based startup Alef Aeronautics has received the FAA's approval to begin testing its Model A flying car. The company aims to have a production version of the flying vehicle for sale by Q4-2025. The Model A features a sports car-like design with a permeable upper body and utilizes eight electrically powered motors for vertical takeoff and flight.
China's Ministry of Industry and Information Technology has changed its "dual-credit policy." This means domestic automakers will receive fewer credits for each NEV they produce. Some automakers may face the risk of not complying with regulations and losing their ability to sell NEVs. China is implementing this change to encourage growth in the NEV segment following the end of significant subsidies and the introduction of new tax credits. However, reducing credits for NEV production could impact automakers' compliance with emissions standards and their ability to continue production. Automakers use these credits to offset carbon emissions and meet regulatory requirements. This situation also highlights how government policies and incentives in the NEV industry can impact market dynamics and automakers' strategies.
Risk Analytics
Foley: IP Considerations in Protecting Autonomous Vehicle Software with Patents and Copyrights
Supply Chain
CPKC, CSX, and Genesee & Wyoming have agreed to create a new rail corridor in Alabama. This will connect markets in Mexico, Texas, and the Southeastern United States. Establishing this corridor is essential for the automotive industry as it will improve transportation infrastructure and help to facilitate efficient trade flows. Rail has been a limiting factor in automotive supply chains, making this development particularly significant.