Elm Analytics - Automotive Supply Chain Risk Digest #251 - November 26 - December 2, 2021

EARNING DIP

New vehicle sales in the US fell nearly 16% in November as limited inventory and high prices slowed sales.

EXPANDING

LG Energy Solution's Michigan office secured $1.36B for EV battery production facilities.

Tesla plans to invest $188M into its Shanghai plant in anticipation of reaching its capacity limit this year.

PPG doubled the capacity to produce automotive clearcoats at its Erlenbach, Germany facility. Hemmelrath sold the site to PPG in 2019.

THK Rhythm Automotive is expanding its plant in Tillsonburg, Ontario. The location manufactures steering and linkage components for Toyota, BMW, and Ford.

INDUSTRY DIRECTIONS

Amazon launched FleetWise, a new cloud-based service that could help automakers remotely diagnose vehicle issues to prevent recalls and improve safety.

MERGERS, VENTURES, ACQUISITIONS

Equinor, Hydro, and Panasonic called off their Joint Battery Initiative begun in August. The companies had been working on selecting a European site for battery production.

Infineon Technologies has acquired Syntronixs Asia, a Malaysian precision electroplating company. The company has provided this essential semiconductor assembly process to Infineon for 12 years.

Stellantis and Mercedes have invested in solid-state battery startup Factorial Energy. Both automakers will co-develop batteries with the company in separate collaboration agreements.

GM and Posco Chemical have partnered to build a new cathode active materials facility in North America by 2024.

OPENING

Chinese smartphone maker Xiaomi is building an EV plant with an annual capacity of 300,000 vehicles, expected to reach mass production in 2024.

PRODUCTION DECREASE

Due to the semiconductor shortage, Michigan automakers made 280k fewer cars this year compared to last year.

RAW MATERIALS

A lake in California, the Salton Sea, could have enough lithium to transform the EV industry in North America.

Lithium executives warn that automakers must work closely to guarantee a supply of lithium. The limitations in storing lithium hydroxide require extensive investment and planning, and companies are hesitant to commit.

RECALLS

Ford recalled around 115k Broncos and Escapes from the 21-22 model year due to a defect in the rear brake lining.

REGULATION

Canadian union Unifor says that Biden's EV tax incentive is putting the future of Stellantis' Brampton assembly plant at stake. The measure would provide a more significant incentive to purchase EVs made in the US.

Mexico is considering imposing tariffs in response to the proposed US EV tax credit.

SHUTDOWN

GM extended its Bolt EV production shutdown through January 28, 2022. Assembly at the Orion plant had just resumed for two weeks in November. GM had initially recalled the vehicle to address battery fire risks in August.