Elm Analytics - Automotive Supply Chain Risk Digest #82 - August 31 - September 6, 2018
CHANGE IN MANAGEMENT
Continental AG executives sent a letter, strongly warning 400 managers that business as usual was not acceptable.
Many automakers such as Volkswagen, Ford, Nissan, FCA and Volvo are planning to skip this year's Paris Motor Show in favor of focusing on their own events. The missing automakers account for almost 40% of European sales.
Despite a recent report stating that certain gasoline engines in VW, Audi and Porsche vehicles could be used to manipulate emissions tests, Germany's Transport Ministry says that there hasn't been any indication of fraud regarding VW's gasoline-fueled cars.
Toyota is recalling 192,000 Prius vehicles from the 2016-2018 model years over a defect in the hybrid power control unit that could cause a fire. The recall is part of a massive global recall that includes about 1 million Toyota vehicles.
Ford is recalling around 2 million select 2015-18 Ford F-150 Regular and SuperCrew Cab vehicles over a fire risk caused by the driver and front passenger seat belt pretensioners. So far, there have been 17 reports of smoke or fire caused by the issue.
MERGERS, VENTURES, ACQUISITIONS
Dyson is charging ahead with their plans to start building electric cars with a $2.6b investment that includes plans to turn a former airfield into a vehicle testing site. The center will be built at the former Hullavington Airfield in England and will include engineering work-spaces and 10 miles of test tracks.
Suzuki is transferring its 50% stake in Changan Suzuki, its last remaining Chinese venture, to Chongqing Changan Automobile Co. As purchasing power has gone up in China, consumers have started to buy larger sedans and SUVs.
Daimler is partnering with Beijing's NavInfo Technology as its exclusive navigation services supplier for China. As part of a seven-year pact, NavInfo will supply mapping services and data products that will be equipped in all of Daimler's passenger vehicles in China from 2020 to 2024.
Toyota is in talks with Geely to cooperate on gasoline-electric hybrid vehicle technology. Specifics of the deal have yet to be announced.
A "distraught" contract worker at the Honda Plant in Marysville, Ohio caused the facility to go into lockdown. The worker reportedly had an ax. The situation suspended production for a few hours.
Brake pad supplier Nisshinbo Automotive is investing $72m into an expansion of it plant in Covington, Georgia. The expansion will create 100 jobs in both production and administrative positions.
Jtekt North America has completed a $5.8m, 19,000sf expansion of its headquarters in Greenville, South Carolina. The extra square footage will accommodate up to 100 new jobs to be filled by 2020.
Volkswagen has opened a new $1.9b facility in Tianjin, China for producing VW and Audi branded SUVs. The plant will produce up to 300,000 vehicles a year at full capacity.
Volkswagen has also signed a memorandum of understanding to assemble cars in Ghana and Nigeria.
FCA is investing $30m into its proving grounds in Chelsea, Michigan to further development and testing of autonomous vehicles. Testing programs will begin at the new facility this month.
India's Amara Raja Batteries Ltd. is planning to build a new lithium-ion battery pack assembly plant in the state of Andhra Pradesh, India. Since there is currently no lithium-ion battery cell production plant in India, Amara Raja will still have to import cells to assemble their battery packs.
Top U.S. and Canadian officials continued talks over a revised NAFTA deal this week. Canadian Foreign Minister Chrystia Freeland said that there are still "...a number of issues to work on" and that "...we will continue our negotiations".
U.S. and EU trade chiefs will meet in Brussels on Monday to pursue closer transatlantic ties following President Trump's agreement to drop his tariff threats on EU cars. The planned meeting follows Trump's comments late last week that the EU's offer to drop car tariffs to zero if the U.S. did the same was "not good enough".
President Trump's proposed tariffs on $200b worth of Chinese goods could go into effect as soon as today, when a public comment period on the taxes concludes. It's unknown if the tariffs will be set at 10% or 25%.
An administrative court in Wiesbaden has ruled that Frankfurt, Germany must ban polluting, older diesel and gasoline vehicles starting next February. The ban would affect about a quarter of cars registered in Frankfurt.