Two weeks out: Elm Analytics will be at the MEMA OE Annual Conference & Expo in Novi, Michigan, Nov. 18-19, just inside the presentation hall entrance. If you’re in Novi, stop by and find us. We’d love to hear what’s on your 2027 risk list. -nick
Contents
CLOSING
IAC to close Cottondale interiors plant
EXPANDING
Sanoh expands Orangeville tubing plant
Toyota weighs additional San Antonio models
HUMAN CAPITAL
BMW Brilliance reportedly cutting 1.8k Shenyang jobs
Schaeffler to cut 3.46k European jobs
LABOR DISPUTE
Audi, Mercedes, TATA hit by German walkouts
Mexican trucking strike ends; blockades persist
MERGERS, VENTURES, ACQUISITIONS
Autoneum to acquire French supplier Trèves
OPENING
GAC’s Inpow opens Thai battery plant
RAW MATERIAL COSTS
Aumovio warns of soaring chip costs
REGULATION
EU committee backs softer 2035 rules
Mexican automakers seek customs delay relief
SHUTDOWN
Stellantis extends Mirafiori production shutdown
SUPPLY CHAIN
Chip shortage disrupts Italian Fiat production
Li Auto substitutes LCDs amid shortages
Mercedes electric GLC faces supply delays
Closing
International Automotive Components (IAC) will close its plant in Cottondale, Alabama, on Dec. 31, cutting 83 jobs, according to a state WARN notice. The plant makes door panels and overhead systems for automakers. IAC announced the $34.3M site in October 2020 with plans for 119 jobs, and it also runs a plant in Anniston. The notice gives no reason for the closure.
Expanding
Tubing supplier Sanoh Canada has completed a 15.7k ft² addition at its plant in Orangeville, Ontario, adding more than 15% to its floor space and installing new equipment to supply the next Honda CR-V Hybrid. The plant opened in 1997, employs about 110, and makes brake, fuel, and chassis tubing for Honda and several Tier 1 suppliers. Honda plans to start building the new CR-V in April 2027 at Alliston, Ontario, and East Liberty, Ohio. (previously: Issue #503)
Toyota, another Sanoh customer, is weighing more product for the new second line at its San Antonio truck plant, which is already slated to build the Tacoma. CFO Yoichi Miyazaki said other frame-based models could join the line in the future. The $3.6B expansion adds about 57 acres of floor space to the 51-acre plant, with capacity for 150k vehicles a year and Tacoma output from 2030.
Human Capital
BMW Brilliance Automotive has begun cutting about 1.8k jobs, roughly 10% of its workforce, according to employees cited by AI4Robo. Most are production workers at its Shenyang base. BMW has not confirmed the cuts. Shenyang is BMW's largest production base worldwide and builds the 3 Series, 5 Series, X1, X3, X5, and the Neue Klasse iX3 and i3. BMW and Mini deliveries in China fell 21.8% to about 376k in the first nine months of 2026. Globally, BMW is reportedly cutting about 8k jobs, with the German cuts aimed mostly at administration, R&D, and planning. The cuts mostly affect production staff at BMW's largest plant, suggesting lower Shenyang build rates rather than just overhead trimming.
In Germany, supplier Schaeffler will cut 3.46k jobs and close five sites in Europe by 2028, citing weaker demand for combustion parts, slow EV adoption, and tough competition. About 2.66k of the cuts fall in Germany, roughly 9% of its core German workforce, and 16 sites are affected in all. CEO Klaus Rosenfeld says German personnel costs run about 2.5 times those in other European countries, and he did not rule out more cuts after 2028. The program targets annual savings of about $336M by 2030, against one-off costs of about $538M that will mostly be booked in 2026.
Labor
Those labor costs are now the subject of a strike. Walkouts spread across Germany's metal and electrical industry this week, hitting Audi, Mercedes-Benz and Tata Steel, as IG Metall presses a pay dispute that covers 3.7M employees. The union wants a 5% raise from November, job and site protections, and profit sharing in strong sectors. Employers have offered a 1% one-off payment in July 2027 and a 1.3% raise from July 2028, and troubled companies could skip the one-off. Strikes continue through the week, and more than 100k workers joined on peak days in the 2024 round. Volkswagen bargains under its own house agreement (previously: Issue #506), so this round lands on Audi, Mercedes, and the German supply base.
Mexico's National Chamber of Freight Transport (CANACAR) and allied groups launched a national strike on Oct. 26. They blocked highways around Mexico City and Guadalajara and targeted customs at Manzanillo, Altamira and Tijuana. The stoppage ended Oct. 27 after two days and 38 protest points in 19 states, when CANACAR and the Interior Ministry agreed to talks on road safety, roads, taxes, social security and working conditions. HAMOTAC did not sign and kept up on-and-off blockades in Zacatecas. Other carrier groups, including CONATRAM, stayed out. The sticking points are cargo theft and taxes. In Q2, 76% of truck thefts were violent, and about 39% targeted parked trucks, mostly at informal roadside stops. Carriers also oppose a 2027 revenue law proposal that would cut the revenue cap for a toll tax credit to about $13.4M from $16.0M. The working groups leave cargo theft and the toll credit cut unresolved, so the risk of another stoppage remains open.
Mergers, Ventures, Acquisitions
Swiss acoustics supplier Autoneum will buy France's Trèves Group for up to $72M, including a $27M earn-out tied to earnings gains through 2029. Autoneum will pay most of the roughly $45M initial price in new shares, with about $8.4M in cash. Autoneum is also taking out a $245M term loan to fund Trèves' operations, refinance its bank debt, and cover working capital. Trèves makes acoustic and thermal insulation, interior trim, and trunk parts, with about 4.6k employees at 26 plants in 15 countries and 2025 revenue of about $806M. Autoneum plans to optimize the combined European plant network and bring more sourcing in-house, with restructuring costs of about $74M in 2027 and 2028. The deal should close early in 2027. At a price under a tenth of Trèves' annual revenue, with Autoneum refinancing its bank debt and funding working capital, the deal reads more like a rescue than a growth move.
Opening
Inpow Battery, GAC Group's battery unit, has started production at its plant in Chonburi province, Thailand. It is GAC’s first in-house battery pack plant outside China. The plant will supply packs for GAC’s electric vehicles in Thailand and other ASEAN markets. Inpow has built more than 300k packs for models including the Aion i60, N60 and UT. GAC Aion’s Thai assembly plant in Rayong opened in 2024.
Raw Material Costs
Aumovio, the supplier spun off from Continental, warned that chip costs will climb sharply in 2027 as AI data centers outbid automakers for capacity. Interim finance chief Claus Bauer expects gross earnings to fall by about $1.1B next year, mainly due to chip inflation. He said data center buyers are not price sensitive. Aumovio uses chips in brake systems and vehicle computers and renegotiates its supplier contracts each year. It plans to recover some of the cost through higher prices for customers such as BMW, Volkswagen, Ford and BYD, and the rest through redesigns and broader cost cuts. SK Hynix's CEO has forecast that 2027 will be the worst year for memory supply in the industry's history. (previously: Issue #491)
Regulation
A European Parliament committee voted Nov. 4 to back the deal that softens the EU's 2035 car CO2 rules, setting Parliament's position for talks with member states (previously: Issue #505). Cars would need an 87.5% cut from 2021 levels, with up to 7.5 more points credited for EU-made low-carbon steel. A new provision lets efficient EVs built in Europe count as 1.2 vehicles. Transport & Environment estimates that about 30% of cars sold after 2035 could still have combustion engines. Suppliers' group CLEPA backed the text but wants a freeze on plug-in hybrid test changes that could raise their measured emissions. The full Parliament votes in December.
Mexico's other freight chokepoint is the border itself. The auto parts group INA and automakers' group AMIA are working with customs agency ANAM and federal ministries to ease border delays for just-in-time parts. The Laredo-Nuevo Laredo corridor carries more than 40% of road freight between the two countries, and peak delays at the World Trade Bridge run 8 to 16 hours. The groups want more commercial lanes, joint inspections with US Customs and Border Protection on one side of the border, and digital waybills that match US manifests. INA says Mexico supplies a record 46.25% of US auto parts imports, where a two-hour customs hold can stop assembly lines on either side.
Shutdown
Stellantis has extended the production stop at its Mirafiori plant in Turin through Nov. 13, the fourth straight week without Fiat 500 output. A Stellantis spokesperson said the first two weeks were due to weak demand, and the current halt is due to a shortage of chips for engine control units. The FIOM union calls the shortage an alibi and blames weak Fiat 500 demand throughout. Whichever account is right, Mirafiori has built nothing for four weeks, and Fiat 500 suppliers are carrying the idle time.
Supply Chain
The shortage reaches beyond Turin. Stellantis said the missing chip, from an unnamed supplier, is causing significant disruption to Fiat production in Italy and could last through November and December. It has already hit October sales of the Fiat Pandina, built at Pomigliano, which could face halts along with Mirafiori. The Termoli plant, which builds the N3 GSE engine used in both the Pandina and the 500, could also be affected. Earlier reports put Mirafiori's October halt down to a separate component shortage.
Li Auto is shipping some of its new Li Mega electric MPVs with LCD screens after Samsung warned of a supply disruption on the custom 29-inch 6K OLED front screen. No other supplier makes a screen to the same specification, and supply is not expected to recover until around year-end. Vehicles built from Nov. 10 to Dec. 17 will get the same-size LCD from the Li L9 Livis, with free OLED retrofits starting March 1, 2027. The shortage comes as Mega deliveries rebound, passing 3k in October from 2.3k in September. A custom part with no second source is a textbook single point of failure. The LCD fallback works only because Li Auto designed the screen to swap out in about 10 minutes.
Single-source trouble is also slowing Mercedes-Benz. Its electric GLC is sold out in Europe for the rest of 2026, and some versions ordered now will not arrive until the second half of 2027. German media say environmental certification and wastewater issues have delayed CATL's new Hungarian battery plant, forcing shipments from China. They also say wire harness supply was delayed by disruption at Kromberg & Schubert’s plant in Morocco (previously: Issue #489). The GLC is built in Bremen. Mercedes has pushed GLC production at Vance, Alabama, from November 2027 to May 2030, according to sources cited by Automotive News, which leaves the model exposed to US tariffs for more than two more years.
