Elm Analytics - Automotive Supply Chain Risk Digest #276 - May 20 - 26, 2022
EV Startup Canoo's Q12022 earnings report:
"As of the date of this announcement, we are reporting that there is substantial doubt about the Company's ability to continue as a going concern."
CHANGE IN MANAGEMENT
Stellantis has named the current head of the enlarged Europe region Maxime Picat as its new head of purchasing and supply chain. In addition, they have shuffled several other key leadership positions in Europe.
New car sales in Russia dropped by a staggering 79% last month. It is the most significant drop in the country on record.
NYT: Mary Barra's 'Long Game': Winning the EV Race
BMW will switch from prismatic to round battery cells by 2025 to reduce battery costs by 30%. The automakers' existing partners will manufacture the new cells.
GM has reached a new deal with the union at its Silao, Mexico plant that includes raises and benefits above inflation for workers.
MERGERS, VENTURES, ACQUISITIONS
GM is teaming with open source software provider Red Hat to expand innovation in its in-vehicle operating systems. The software will support safety and non-safety-related applications, including infotainment, driver assistance, body control, and connectivity.
Ford announced this week that it is dropping plans to produce EVs in India. Production at the automakers' existing plants there has already stopped.
Hyundai confirmed its plans to build a new US EV factory but has not established a location, though rumors point to Georgia.
Subaru will build its first dedicated EV factory in the late 2020s. The plant is part of the automaker's plan to spend $1.93B to bolster electrification over the next five years.
Toyota is suspending operations on fourteen lines at eight domestic factories from May 16-21 due to the COVID-19 lockdown in China. The partial shutdown will drop vehicle output by around 30k vehicles.
Hyundai is re-recalling around 215k 2013-2014 Sonatas due to a faulty fuel hose. This is the second recall for these vehicles, as the first fix appears to have been inadequate.
Tesla recalled 130k cars and SUVs due to a problem that can cause the in-vehicle display to overheat while charging. An over-the-air software update will be released to mitigate the issue, as with other recent recalls.
Rivian recalled 500 R1T EV pickup trucks due to airbags failing to deactivate with a child front seat passenger. Hyundai Transys Michigan supplies the seats that identify the type of occupant.
Advisory firm Grant Thornton is forecasting that the ongoing war in Ukraine could disrupt the auto sector for years to come.
While 2020 and 2021 set records, S&P Global's PMI survey warns:
"China's PMI data have shown a more severe downturn in manufacturing output due to the recent Omicron outbreaks than seen in the initial COVID-19 shutdowns, which has the potential to feed through to further supply delays in coming months."
Speaking at the FT Future of the Car 2022 conference this week, Stellantis head Carlos Tavares said that the auto industry would face a shortage of EV batteries and raw materials in the coming years. He added that he anticipates supply problems to surface in 2025 and 2026.
Not only did Tesla's Chinese sales dive 98% in April from March, but its Shanghai plant also shut down due to parts shortages caused by COVID-19 lockdowns.
Ford and Stellantis stopped production this week due to semiconductor-related parts shortages. Ford shut down its Louisville, Kentucky, and Oakville, Ontario plants, and Stellantis idled its Belvidere, Illinois Jeep plant.
Aptiv has suspended parts deliveries from its plant in Shanghai due to a reported COVID-19 outbreak. The plant supplies Tesla and GM.