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Elm Analytics - Automotive Supply Chain Risk Digest #94 - November 23 - 29, 2018
CHANGE IN MANAGEMENT
Following in Nissan's footsteps, Mitsubishi has ousted Carlos Ghosn as chairman. The automaker has appointed CEO Osamu Masuko as interim chairman.
GM has appointed its President Dan Ammann as the new CEO of its Cruise Automation subsidiary. Ammann will officially start his new role at the beginning of next year.
PSA owned brand Vauxhall is cutting an extra 241 jobs from its Ellesmere Port, England plant on top of the 650 cuts announced last year and earlier this year. PSA CEO Carlos Tavares says they will decide in 2020 whether to make fresh investment and keep the plant open.
Ford is eliminating shifts at its Louisville, Kentucky and Flat Rock, Michigan plants, but plans to give all affected workers jobs at other plants nearby. 500 workers from Louisville will move to the Kentucky Truck Plant while around 500 workers in Flat Rock will be able to transfer to the Livonia Transmission Plant.
Volvo and Luminar say that they have developed a new Lidar system that can detect human poses including individual limbs, which is a level of detail not previously possible with Lidar. Volvo is planning to offer unsupervised highway driving on the third-generation XC90, which is due in 2021.
Automotive News China: The automotive market downturn is amplifying manufacturer's excess capacity.
MERGERS, VENTURES, ACQUISITIONS
Nvidia has inked deals with XPeng Motors, Singulato Motors and SF Motors. The Chinese electric vehicle startups will use Nvidia hardware for autonomous vehicles.
VW's Seat brand will work with Anhui Jianghuai Automobile Group Corp. to develop an electric vehicle platform. The platform will be launched in China by 2021.
General Motors is closing its assembly plants in Detroit, Michigan, Lordstown, Ohio and Oshawa, Canada by the end of 2019. In addition to the assembly plant closures, the automaker is also planning to close transmission plants in Warren, Michigan and Baltimore, Maryland.
In response to GM's plans to close its Oshawa, Canada assembly plant, Martinrea has announced that they will close their Ajax, Ontario plant. The plant currently supplies suspension modules and engine cradles for the Cadillac XTS and Chevy Impala, which are built at GM's Oshawa plant.
FCA will invest more than $5.7b into its plants in Italy to better utilize them and boost jobs and margins. A big part of the investment will focus on developing new electric and hybrid models.
Gestamp has opened a plant in Tianjin to provide Daimler and Hyundai with chassis and body components.
Samsung is planning to build a new $62.7m automotive battery plant in Auburn Hills, Michigan. The company's first high-volume battery plant in the US would create 461 jobs by the end of 2024.
Volkswagen is scouting for a location to build a new electric car plant in North America according to CEO Scott Keogh. The automaker is planning to introduce a $30-40k EV in 2020 with production initially being sourced outside of the U.S. before production starts at a new plant.
UK car production dropped by 9.8% last month over continued uncertainty surrounding Brexit and market turbulence. Compared to the same period last year, from January to October, overall production is down 6.9%.
U.S. Trade Rep. Robert Lighthizer says that President Trump has ordered a review of China's 40% tariff on U.S. auto imports. He added that the President has directed him to "examine all available tools to equalize the tariffs applied to automobiles."
A Nissan probe has reportedly found that ousted CEO Carlos Ghosn failed to disclose more than $80m in differed pay. Nissan says it cannot confirm the report, but adds that the investigation has "...revealed evidence of significant underreporting of compensation, as well as misuse of company assets...".
South China Morning Post: Twist in Trump's trade war- Manufacturers are fleeing China, but just not for US shores
The U.S.-Mexico-Canada Agreement is set to be signed today. Still at large are 25% steel and 10% aluminum tariffs on Canadian and Mexican imports.
The end of production at GM's Oshawa, Canada facility next year could mean a $2.3b blow to the plant's Canadian suppliers according to the Automotive Parts Manufacturers' Association. APMA head Flavio Volpe says that the plant's $3b/year buy supports around 10,000 jobs or around 10% of Canada's auto parts industry.