Contents
BANKRUPTCY
Canoo layoffs amid financial challenges
CHANGE IN MANAGEMENT
Ford reduces leadership team in Germany
BorgWarner announces CEO succession plan
Toyota North America’s Bob Young retiring
CLOSING
Sumitomo Rubber closing New York tire plant
Michelin to close two French factories
HUMAN CAPITAL
BYD hires 200k workers to expand
Nissan cuts 9k jobs, restructures globally
Schaeffler to lay off 4.7k employees
Volkswagen plans layoffs, cost-cutting measures
Audi to cut thousands of German jobs
Stellantis cuts shift at Toledo plant
LABOR DISPUTE
Union strike at Woodbridge’s Georgia factory
Flex-N-Gate Chicago workers vote to unionize
OPENING
MG Motor to invest $1.05B in Mexico
REGULATION
S&P Global Mobility analysis on US election impact
SHUTDOWN
Chinese automaker Neta halts production, cuts salaries
Bankruptcy
Canoo has announced layoffs for nearly a quarter of its remaining workforce, affecting around 30 employees for at least 12 weeks.
The EV startup has been struggling financially, with only $4.5M in cash and a significant decline in stock price - from a high of $400 in December 2020 to approximately $0.40 as of November 7, 2024.
The company claims the layoffs are part of a relocation to Justin, Texas, and a realignment of North American operations.
Despite government contracts and previous expansion plans, Canoo sold just 22 vehicles in 2023. The once 800-person company’s future remains uncertain as it attempts to overcome production and financial challenges.
Change In Management
Ford is once again reducing its leadership team in Germany as part of its ongoing restructuring efforts.
Two experienced leaders, Christian Weingärtner and Rene Wolf, resigned effective November 1, 2024, leaving the company with only two managing directors - Dave Johnston and Marcus Wassenberg, who were appointed in July.
This follows the previous loss of Martin Sander, the top European executive, in June. The company’s restructuring aims to simplify its management structure and accelerate business transformation.
Additionally, Ford recently started delivering its new Capri EV, the second electric model based on Volkswagen’s MEB platform, following the Electric Explorer produced at the new Cologne EV center.
BorgWarner has announced that Joseph Fadool, currently Executive Vice President and COO, will become President and CEO effective February 6, 2025. He will succeed Frédéric Lissalde, who will retire and serve in an advisory role until August 2025.
Bob Young, group vice president of Purchasing Supplier Development at Toyota Motor North America, will retire on March 28, 2025, concluding over 30 years of service. Ryan Grimm, presently vice president of Parts & Materials Procurement, will assume the role of group vice president on December 2, 2024.
Closing
Sumitomo Rubber halted production and announced it would close its tire manufacturing plant in Tonawanda, New York, eliminating 1.55k jobs. The closure follows unsuccessful cost-control efforts and investments in the aging facility, which failed to mitigate financial losses.
The surprising decision was made without consulting local officials, despite previous support from Erie County. The company had recently invested $140M in the plant, but attempts to find a buyer were unsuccessful.
Michelin announced plans to close its factories in Cholet and Vannes, France, by early 2026, affecting over 1.25k workers due to collapsing sales. Employees have begun protests, burning tires and voting to strike in response to the closures, which Michelin said were unavoidable due to rising competition.
Human Capital
BYD has hired a mind-blowing 200k new employees between August and October as production ramps up to meet surging demand. The company sold 1.1M NEVs in Q3, with net income reaching $1.6B, surpassing Tesla’s revenue for the quarter.
BYD’s aggressive hiring is part of its strategy to rapidly expand globally, including opening new manufacturing plants in Thailand, Hungary, and Mexico. BYD’s competitive pricing and consolidated supply chain control have helped it gain market share from traditional automakers.
Nissan will cut 9k jobs and reduce global manufacturing by 20% to save $2.6B due to sales declines in the US and China. Makoto Uchida, Nissan’s CEO, admitted they misjudged the rising demand for hybrids in the US. Nissan reduced its annual profit forecast by 70% and canceled its net profit outlook as part of ongoing restructuring.
Schaeffler plans to lay off 4.7k employees in Europe as its operating profit nearly halved in Q3-2024. The layoffs spotlight European automotive suppliers’ challenges amid rising costs, declining demand, and increased competition, especially from China.
Germany will see the most significant impact, with around 2.8K job cuts at ten sites. The remaining job cuts will occur at unspecified locations, affecting five European plants, including two site closures. The efficiency plan aims to save $316M annually by 2029 but will cost $632M.
Moving to North to Berlin… Volkswagen CEO Oliver Blume called cost-cutting measures essential to address decades of structural issues. Weak demand in Europe and lower earnings from China have worsened these challenges. While cost-cutting targets are firm, Blume said there is flexibility in how to achieve them.
Volkswagen’s works council mentioned plans to shut three factories in Germany, lay off over 10k staff, and shrink other plants. The company is also considering a 10% pay cut for employees to stay competitive.
VW’s family member, Audi, plans to cut thousands of jobs outside of production, focusing on indirect roles such as development, where over 2k positions could be impacted.
The cuts target a 15% reduction, affecting around 4.5k jobs in Germany. The company is negotiating with workers’ representatives but has not confirmed specific numbers. Audi’s profit fell sharply in Q3-2024, partly due to costs related to the potential closure of its Brussels plant, which employs about 3k people.
Stellantis will cut a shift at its Toledo Assembly Complex in Ohio, resulting in indefinite layoffs for about 1.1k union workers starting January 5. The cuts are part of efforts to reduce high inventory levels and realign US operations for 2025.
Labor
About 70 union production workers at the Woodbridge Corp factory in Lithonia, Georgia, have gone on strike $, demanding better pay and benefits. The plant produces molded foam products, including automotive seating components, door and console armrests, and exterior parts like bumper assemblies and under-vehicle shields.
Workers at Flex-N-Gate’s Chicago factory voted 195-126 to unionize with the UAW despite an aggressive anti-union campaign from the company. The plant, a significant supplier for Ford’s Chicago Assembly Plant, employs workers at wages significantly lower than UAW-represented Ford workers.
Opening
Chinese/British automaker MG Motor will invest $1.05B to establish a manufacturing plant in Mexico to support its growth in Latin America. The facility will have a production capacity of 100k units per year, with $450M allocated for infrastructure and $500M for equipment.
Regulation
S&P Global Mobility: 2024 US Election: A Republican White House emerges. What’s next for the auto industry?
Shutdown
Chinese NEV maker Neta, a brand under Hozon Auto, has halted production at its Tongxiang factory in Zhejiang and implemented salary cuts as sales have sharply declined.
Neta’s domestic sales reached only 53k units from January to September 2024, missing its annual target.
Production at its main factory focused on Neta L crossovers was halted for part of October, and employee salaries were delayed, partly due to outstanding payments to suppliers.
Neta has also faced delivery issues with its S Hunting model due to missing parts, which has been impacting sales further. Despite financial challenges, Neta is looking to expand overseas, with recent market entries in Southeast Asia, Latin America, and other regions.