Elm Analytics - Automotive Supply Chain Risk Digest #304 - December 2 - 8, 2022
CHANGE IN MANAGEMENT
Ford CMO Suzy Deering has left the automaker as of today. Ford said that Deering's successor will be announced at a later date.
GM and LG's JV Ultium Cells announced that it will invest $275M into expanding its EV battery plant in Spring Hill, Tennessee. The expansion will increase production by over 40% and add 400 jobs.
Car interior components supplier Eissmann Automotive will invest $3.4M into expanding operations at its plant in Pell City, Alabama. The investment will go towards new equipment and creating around 80 jobs.
The UAW is urging automakers to move their supply chains out of the Xinjiang region of China after a new report suggests that nearly every major automaker has significant exposure to products made with forced labor there.
Workers at Autoneum's plant in Bloomsburg, Pennsylvania, are on strike following a stall in labor contract negotiations. A chief complaint from workers is the supplier's insistence that workers pay 5% more of their health care costs in addition to a usual yearly increase.
MERGERS, VENTURES, ACQUISITIONS
To shift towards EVs, BorgWarner will spin off its fuel systems and aftermarket segments into a separate company. After the spin-off, BorgWarner itself will consist of the e-propulsion & drivetrain, and air management segments.
Hyundai and battery maker SK On will jointly invest $4-5B into a new EV battery plant near Cartersville, Georgia. The plant will create around 3.5k jobs and is expected to start production in 2025.
CATL will provide Honda with EV batteries for its Chinese vehicles. Japanese automakers embraced fully electric vehicles slower than others and have relied on partners to make up for the lost time.
Apple is reportedly scaling back the design of its autonomous vehicle and pushing back its release to 2026. While they had originally planned for a car with no steering wheel or pedals, the new design will supposedly add them back and only support fully autonomous driving on highways.
Taiwanese semiconductor maker TSMC has announced that it will build a second new plant in Arizona, increasing its investment in the state from $12B to $40B. The first new plant will open in 2024, and the second in 2026.
Japanese EV battery maker Envision AESC is investing $810M into a new plant in Columbia, South Carolina. The new plant will create 1,170 new jobs and support the company's partnership with BMW.
VW's battery subsidiary PowerCo is pushing its decision to build a new factory in eastern Europe into 2023. The European plant would be its fourth, planned out of six total.
Tesla's Shanghai assembly plant is cutting back hours and hiring to deal with high inventory.
Tom Zhu, Tesla's president in China, has been brought to its Gigafactory in Texas to ramp up production. Zhu arrived with an engineering team to assist after they successfully increased output in Shanghai.
Mercedes-Benz will double the capacity to produce electric drive units at its Untertürkheim facility in Germany. The ramp-up begins in 2024 as part of a new works agreement.
BloombergNEF’s annual lithium-ion battery price survey shows a 7% rise. This is the first increase in price in the history of the survey. They expect prices to begin to fall again in 2024 as more supply comes online and battery technologies move forward.
A new joint project in Germany called "CaSino" is looking into the potential of developing batteries from calcium-sulfur (Ca-S) as an alternative to lithium-ion. While calcium is cheaper and 400 times more abundant than lithium, researchers still have plenty of challenges to overcome.
Jeep has recalled 63k Wrangler 4xe hybrid vehicles due to a fault that can cause the engine to shut down unexpectedly. The issue affects cars from the 2021-2023 model years that were produced before August 17, 2022.
The European Union is looking for modifications to be made to US EV consumer tax credits that currently will only apply to vehicles made in North America. In a joint statement, the US-EU Trade and Technology Council said, "We acknowledge the EU's concerns and underline our commitment to address them constructively."
Volkswagen's main plant in Wolfsburg, Germany, is continuing to operate at under 50% capacity due to the chip shortage. VW brand chief Thomas Schaefer says that suppliers are canceling deliveries with one night's notice and that chips are selling with up to an 800% surcharge.