north american auto manufacturing challenges during a ... · challenges during a global pandemic...
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North American Auto Manufacturing Challenges During a Global Pandemic
Bernard Swiecki, Director
3 April 2020
REMI
2CENTER FOR AUTOMOTIVE RESEARCH
THE CENTER FOR AUTOMOTIVE RESEARCH (CAR)
Automotive industry contract research and service organization (non-profit ) with more than 30 years experience forecasting industry trends, advising on public
policy, and sponsoring multi-stakeholder communication forums.
Consortia that bring together industry stakeholders to participate in working groups, networking opportunities, and access to CAR staff.
RESEARCH EVENTS CONNECTIndustry-driven events and conferences that deliver content, context, and connections.
Independent research and analysis on critical issues facing the industry.
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End of the Cycle:N.A. Announced Automaker Investment by Region2009 to 2019
Region Investment Amount ($USD)
Canada $8.7B
United States $114.5B
U.S. Great Lakes $76.8B
South $23.8B
Mexico $24.7B
Total $147.9B
Note: U.S. Great Lakes includes: IL, IN, KY, MI, MO, and OH
South includes: AL, FL, GA, MS, SC, TN, and TX
6%
77%
17%
CENTER FOR AUTOMOTIVE RESEARCHReturn to OverviewSource: CAR Book of Deals, Q4 2019
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Motor Vehicle and Parts Manufacturing Employment:Michigan vs. U.S. and Other StatesQ1 2009 – Q4 2019
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
Nat
ion
al E
mp
loym
ent
Stat
e E
mp
loym
ent
Michigan Ohio Indiana Alabama Kentucky U.S.
Source: Bureau of Labor Statistics Return to OverviewCENTER FOR AUTOMOTIVE RESEARCH
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U.S. Light Vehicle SalesPercent Change (YTD) Through March: 2020 vs. 2019
CENTER FOR AUTOMOTIVE RESEARCH
-25.0%
-7.4%
-12.7%
-30% -25% -20% -15% -10% -5% 0%
Passenger Cars
Light Trucks
Total
Source: Wards Auto; CAR Research
-506,969
+ -207,170
-299,799
Total
Truck
Cars
2,575,212
74.1%
901,300
25.9%
3,476,512
100%
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U.S. Light Vehicle Monthly SalesJanuary 2017 – March 2020
CENTER FOR AUTOMOTIVE RESEARCH
900,000
1,000,000
1,100,000
1,200,000
1,300,000
1,400,000
1,500,000
1,600,000
1,700,000
1,800,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Ligh
t V
ehic
le S
ales
2017 2018 2019 2020
Source: Wards Auto; CAR Research
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U.S. Light Vehicle Monthly Sales and SAAR:March 2017 to March 2020
CENTER FOR AUTOMOTIVE RESEARCH
11.37
0
2
4
6
8
10
12
14
16
18
20
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20
Mo
nth
ly S
AA
R
Ligh
t V
ehic
le S
ales
(M
illio
ns)
Sales SAAR
Source: Wards Auto; CAR Research
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CAR’s U.S. Light Vehicle Sales Forecast 2020-2027
JANUARY 2020
17.5 17.2 17.2 17.016.5 16.6
16.917.4
17.8 17.9 17.6 17.3
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
U.S
. LV
Sal
es in
Mill
ion
s
U.S. Light Vehicle Sales
Source: CAR Research, January 2020
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Modeling the Pandemic
1. Production disruption due to shortages from China
2. Impact of the virus itself
3. Demand drop and recession
CENTER FOR AUTOMOTIVE RESEARCH
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Understanding What Comes Next
• A stoppage, not a slowdown• Capital for recovery is a bigger issue• Direct precedent not available
• Knowing when we’ve hit bottom• Of the pandemic• Of the resulting economic downturn
• Duration is everything• Bringing production back becomes more difficult• Demand challenges are compounded
• Deferred sales today can be sales that never happened next year• New → Used → Existing Vehicle
CENTER FOR AUTOMOTIVE RESEARCH
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Arsenal of Health
12 automakers and 9 other companiesLocation of supports
• 20 in the United States• 8 in Europe• 5 in Asia• 1 in Canada
Means of supports• 10 Personal protective items production/procurement • 8 Service providers• 7 Medical device production/procurement • 5 General medical items production/procurement• 3 Cash donation• 1 Volunteering
Thank youBernard Swiecki, Director - [email protected]