Elm Analytics - Automotive Supply Chain Risk Digest #280 - June 17 - 23, 2022
CHANGE IN MANAGEMENT
Mercedes-Benz named former McKinsey partner Paul Gao its chief strategy officer.
Stellantis named former GM exec Tobin Williams its senior VP for human resources in North America.
BMW is spending $1B to expand its Steyr, Austria, plant to produce EV drivetrains (its second location).
The Uyghur Forced Labor Prevention Act goes into effect this week, barring products made in Xinjiang, China. NYT digs deeper into the forced labor issues surrounding the EV supply chain.
Meanwhile, VW is facing scrutiny about its operations and suppliers' human rights and labor practices in Xinjiang, China.
Elon Musk's statements about staffing have been confusing at best. This week, he clarified Tesla is cutting 10% of salaried employees while attempting to grow hourly. Overall, this equates to a 3.5% workforce reduction.
However, Tesla may face difficulty filling 12k jobs at its Gruenheide, Germany plant. The labor union, IG Metall, says the current 3k workers have wages that are 20% less than rivals.
Workers from FCA Serbia's plant in Kragujevac protested layoff and relocation plans. Production will shut down until 2024, when the plant reopens to make EVs.
Tesla faces a lawsuit from laid-off workers alleging the company failed to follow the WARN act. The legislation requires companies to provide 60-days notice for any mass layoff of 50 or more workers.
French Renault and Nissan owners are taking legal action over the performance of their 2012-18 1.2L, 4cyl gas engines.
Ford has selected Valencia, Spain, as its new European EV manufacturing base. The Almussafes plant, built in 1976, will be restructured to support its new EV architecture.
Toyota dropped 50k vehicles from its July production plan due to COVID-related and semiconductor parts disruptions.
Tesla CEO Elon Musk's two newest factories in Texas and Germany are struggling with producing new types of batteries and COVID shutdowns.
"Both Berlin and Austin factories are gigantic money furnaces right now. Okay? It's really like a giant roaring sound, which is the sound of money on fire."
BMW's Lydia plant in Shenyang, China, has officially begun producing EVs.
The US Senate passed a rare bipartisan bill to subsidize US semiconductor production in June 2021. A year later, the bill is still stagnating in the House, and now chip manufacturers are looking to build overseas instead.
Germany is still deciding if it will join the 2035 EU ban on selling ICE vehicles.
AlixPartners: 2022 Global Automotive Outlook Overview
Stellantis has shut down its crucial Melfi plant in Italy again due to semiconductor shortages. In all, the plant has operated for only seven days in June.
The company will also close two French plants temporarily due to chip shortages - Citroen (Brittany) & Peugeot (Sochaux)
Tesla's Shanghai, China, plant will suspend production for the first two weeks of July. The plant will use that downtime to make updates to support a boost in production.
GM will pause production at its Factory Zero for four weeks to expand its capacity.
In 2025, Ford is shutting down production at its Saarlouis, Germany, assembly plant that produces the Focus.
Center for Automotive Research: Automotive Supply Chain Update
VW will leave the option to run its plants on coal due to potential natural gas disruptions from Russia.