Discover more from Automotive Supply Chain Risk Digest
Elm Analytics - Supply Chain Risk Digest #19 - June 17 - 23, 2017
CHANGE IN MANAGEMENT
After a series of recent controversies, Uber CEO Travis Kalanick has resigned from the company.
GM will eliminate a shift at its Kansas City sedan plant as demand for passenger cars falls. The layoff will affect 1000 people.
International Automotive Components will lay off 160 people at its Dayton, Tennessee plant. They are moving some of the plant's operations to another plant in the Midwest.
Midwest manufacturers in Warsaw, Indiana aren't having problems with China. With unemployment at 4.3%, the problem is too many jobs and too few skilled workers.
Kia Motors topped J.D. Power's initial quality study for the second consecutive year. Hyundai came in second followed by Porsche in third, Ford and FCA tied for fourth place, and Fiat, Jaguar Land Rover and Volvo coming in at fifth, sixth, and seventh place.
10 years ago, the automakers shifted warranty expenses to their suppliers. Yet, recent safety recalls have raised warranty costs back up. Who is more at risk with higher warranty expense rates?
As a show of solidarity with dockworkers in Spain, seaports across Europe will strike for two hours on June 29 from 10am to noon. Participating ports are in Belgium, Croatia, Cyprus, Denmark, France, Greece, Latvia, Malta, Montenegro, Portugal, the UK, Spain, Slovenia, and Sweden.
MERGERS, VENTURES, ACQUISITIONS
ZF has partnered with Hella to develop radar and camera technology. The partnership intends to address OEM demands for autonomous technology pushed earlier into production.
Accuride has entered into an agreement to acquire German steel wheel manufacturer Mefro Wheels. The intent is to expand its manufacturing reach in Europe and Asia.
Continental has joined Intel's self-driving car project that is already partnered with BMW, Delphi, and Mobileye. The project plans to begin selling its technology by 2021.
Honda halted production at its Sayama assembly plant earlier this week after finding the WannaCry ransomware in its computer network. Production at the plant was only shutdown for one day and regular operations have resumed.
Automotive News covers the recovery effort from the aftermath of the Anderton Castings factory fire (April 5, 2017). The disaster, which affected ZF's supply chains to Honda and FCA, started when a bottle of nitrogen fell into a cauldron of molten metal.
Ford is spending $900m to revamp its Louisville, Kentucky truck plant to build the 2018 Expedition and Lincoln Navigator. The large SUVs will replace the currently built Super Duty line.
Modular front-end systems supplier HBPO plans to open two new just-in-sequence production plants in Mexico next year. The new plants will support automaker assembly plants in Aguascalientes and Saltillo. Though HBPO did not name their clients, they are inferred to be Nissan and FCA.
General Motors is planning to open a new supplier park in the Dallas suburbs to build parts for its SUV plant in Arlington, TX. The complex will have two plants and a number of warehouse buildings totaling 1.2m sq ft. Around 850 jobs will be created, with 600 of them being reshored positions from overseas.
Electric vehicle maker SF Motors is buying AM General's Mishawaka, Indiana assembly plant. They plan to keep all of the plant's 400+ workers.
American Honda Finance has paid a fine of $87,255 on behalf of its Canadian subsidiary for violating the Cuban Assets Control Regulations with 13 lease agreements between Feb. 2011 and Mar. 2014. Though the transactions were legal in Canada, the Canadian company is subject to US sanctions since they are a subsidiary of American Honda.
In a move aimed to improve their "operational fitness", Ford has announced that it will build most of its next generation Focus cars in China. Ford says it will save $1b by doing so.
Honda's European Senior Vice President, Ian Howells, warned this week that Brexit could seize supply chains. The current efficiencies of the EU customs union and associated administrative cost savings will be lost.
Cars being made in the UK are using more British parts. 44% of all components now come from domestic suppliers compared with 41% in 2015 and 36% in 2011. This will also help the industry meet "rules of origin" thresholds required to qualify for lower trade tariffs if Britain cannot negotiate a deal with the EU.