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Supplier Symposium Planned for
2005 to Increase North American Suppliers' Global Competitiveness
With the goal of increasing the global
competitiveness of the North American automotive industry
and promoting deeper technical exchanges between suppliers
and the Japanese OEMs, the Motor & Equipment Manufacturers
Association (MEMA) and the Japan Automotive Manufacturers
Association (JAMA) will sponsor the MEMA/JAMA Suppliers
Symposium on Thursday, April 21, 2005, in Dearborn,
Mich.
The joint effort was announced by
the JAMA-MEMA Liaison Committee, which held its 23rd
meeting on Sept. 27 prior to the One on One® Business
Conference here.
The Symposium will unite manufacturing,
production and purchasing executives from Japanese automakers
in the United States with the product development and
design staffs of North American suppliers.
"We think the Supplier Symposium
offers a great opportunity for our industry," said
MEMA President Bob McKenna. "We need to be looking
for ways to engage more suppliers in the task of making
the entire industry more competitive and better prepared
to meet the demands of the global marketplace. We are
excited about partnering with our friends at JAMA on
this project," he said.
Information on this event will be
available later at the MEMA Web
site.
The liaison meeting was co-chaired
by Toru Onda, JAMA's purchasing committee chairman and
managing director of Honda Motor Co. Ltd., and Alan
S. Dawes, MEMA chairman and vice chairman and CFO of
Delphi Corp. The JAMA-MEMA Liaison Committee was created
in 1987 as a forum for the senior purchasing executives
of Japanese automakers and MEMA member suppliers to
meet on a regular basis and build long-term business
relationships.
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MEMA/JAMA One on One® - A
Unique Business Event
Executives from North American suppliers
recently met with executives from Japanese carmakers
at the MEMA/JAMA One on One® Business Conference.
The two-day Conference, held Sept. 28 and 29, resulted
in 270 executives from 40 North American suppliers meeting
with more than 130 executives from Toyota, Nissan, Honda
and other Japanese OEMs.
"This is really a one-of-a-kind
event," said Brian Duggan, MEMA director of international
affairs. "Suppliers and Japanese OEMs held individual
meetings, all in one location. It was a good mix of
suppliers, from very large ones to small, private companies.
Nearly all product categories were represented,"
he noted.
The One on One® Business Conference
was organized in the early 1990s when MEMA members were
just beginning to supply to Japanese OEMs.
The event, held every 18 months, continues
to have a loyal following on both sides of the Pacific,
Duggan noted. "Over the past 10 years, this conference
has been instrumental in helping MEMA member companies
grow their businesses with Japanese OEMs, particularly
in North America," he said.
The next MEMA/JAMA One on One®
Business Conference is scheduled for May 2006 in Yokohama
Japan. Details will be made available on at the MEMA
Web site.
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Automechanika Draws Record Crowds;
U.S. Exhibitor Reception a Hit
A record 163,564 people attended the
2004 Automechanika, which was held Sept. 14-19, in Frankfurt,
Germany. The event brings together executives from the
aftermarket and original equipment segments. This year
145 countries were represented.
The "U.S. Manufacturers and Exporters
Exhibitor Reception," held on Sept. 16, drew nearly
200 executives. For the first time, the reception was
sponsored by four of the leading aftermarket trade associations,
MEMA, Overseas Automotive Council (OAC), Automotive
Aftermarket Industry Association (AAIA) and the Specialty
Equipment Market Association (SEMA). Dana Global Sales
was the reception's primary sponsor.
"The event was a huge success,"
said Anthony Cardez, OAC director of business development.
"The associations worked together to strengthen
this event, which has proven to be one of, if not the
best, networking opportunities for U.S. exhibiting manufacturers
and their customers at Automechanika. MEMA and OAC are
certainly proud to be part of this event."
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Europe Nears Decision to Deregulate
Auto Body Parts Market
AutoBeat Daily
The European Commission has again
urged members of the European Union to overturn laws
in 16 countries that give OEMs exclusive rights to make
and sell replacement fenders, hoods and other so-called
crash parts.
The proposal, which has been vigorously
opposed by automakers, will be voted upon by the European
Parliament this fall. It originally came up for approval
in May but has been delayed twice since then.
OEMs say the measure will threaten
up to 50,000 jobs and cost manufacturers some $3 billion
per year by flooding Europe with cheaper, less-safe
and lower-quality replacement body panels made in such
places as Taiwan. Supporters say the rule would reduce
insurance costs and cut the cost of fixing crash damage.
Some EU members allow independent
suppliers to sell crash parts now. But most of the region's
countries shield OEMs from such competition in Europe's
$12 billion replacement body parts market by giving
them legal rights to body panels they design.
The law won't take effect unless a
majority of the EU's 25 member countries approve it.
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German Suppliers Moving to China
and Eastern Europe
A study by
consultants at Ernst & Young says that German suppliers
are almost all moving to expand their production abroad
and in particular in Eastern Europe and China.
Ernst & Young surveyed over 200
suppliers of all sizes.
"Nothing will happen overnight,"
says Peter Fuss, a partner at Ernst & Young, but
he thinks that the move is gathering pace.
The move is driven by growth opportunities
in those markets - in particular China - and increased
cost pressure from carmakers. Fuss said that the biggest
surprise was that China and the Czech Republic "got
very good marks for skilled labor and the overall environment."
Fuss says that a lot of complex parts
have already moved to Eastern Europe and China.
Not all emerging markets are expected to see rapid growth
in manufacturing investment from German companies. In
Russia, for example, "no further move is expected"
among the companies surveyed, said Fuss.
Fuss said that he was also surprised
to see India near the bottom of the list of countries
expected to see significant growth in the next 10 or
fifteen years.
Indian technology is well behind and
the political system is "not that stable"
said Fuss. Ninety percent of the companies surveyed
who had already moved production to either Eastern Europe
or China were going to move more business there, according
to the survey. "That is a very good indication
that most companies have had a good experience,"
said Fuss. "Tax credits or tax subsidies were not
important to any of the companies we asked."
Fuss also said that there appeared
to be no concern at suppliers about political risks
to investment.
"The uncertainties on the political
environment in China seem to be no hurdle," said
Fuss.
Bosch Says Government Supportive
in China
Peter Marks, Bosch's director for
manufacturing coordination and investment planning,
who talked about Bosch's operation in China at the Automechanika
Parts Show in Frankfurt, echoed this view.
China is planning to build up its
automotive supplier industry and is demanding more research
and development capacity in its China Automotive Industry
development policy (CAP). But Marks is confident that
CAP, which is yet to be fully defined, will be an environment
in which the company can work.
The Chinese government has been very
sensitive to not enact any laws that stifle economic
development," Marks told "SupplierBusiness.com."
"In the further refinement of this economic policy
I think they will be listening very carefully to the
industry," said Marks.
Marks agrees that the technological
potential of the Chinese industry is growing. The protection
of intellectual property "is an issue, but we can
mange this" he says, by carefully selecting Bosch's
partners in China.
Bosch launched a China purchasing
initiative in 2003 that is delivering "very good
progress" said Marks. Bosch is looking for its
European suppliers to invest in China and for local
partners to develop the capability to supply more sophisticated
parts.
More sophisticated parts Bosch is
now looking to buy in China include turned parts, aluminum
die casting, and printed circuit board assembly. Bosch
is investigating sourcing stamping parts, springs, plastic
parts, sintered parts and metal forgings from China.
Bosch had sales of $1.5 billion in China in 2003 (equivalent
to around 5 percent of automotive turnover) including
all its joint ventures, and has 20 manufacturing locations
there. Of Bosch's 10,300 employees in China, 4,700 work
in the automotive division.
Bosch recently invested $345 million
in its Bosch automotive diesel systems company.
Marks says that more and more cars
are being fitted with diesels in China and that Bosch
expects the diesel share of the total vehicle market
to stay at around 27 percent.
China is well on the way to becoming
the factory of the works, says Marks. Bosch expects
China to be the second-largest vehicle manufacturing
location from 2013.
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Record Attendance Makes AAIW/OAC
International Reception The Global Networking Event
The Automotive Aftermarket Industry
Week (AAIW)/Overseas Automotive Council (OAC) International
Reception on Nov. 2 in Las Vegas, Nev., was the networking
event for global business contacts at the 2004 gathering
of the global automotive aftermarket. A record total
of more than 900 people from 55 countries attended the
event.
"This is the second consecutive
year we have seen an increase in attendance at the AAIW/OAC
reception," said Anthony Cardez, director of business
development for OAC. "The increase shows that domestic
buyers are coming to understand the value of global
marketing - and the international networking this event
offers," he said.
The event was jointly produced by
the OAC, the Automotive Aftermarket Suppliers Association
(AASA), the Automotive Aftermarket Industry Association
(AAIA) and the Specialty Equipment Markets Association
(SEMA). OAC is the international aftermarket division
of MEMA - www.oac-intl.org.
Sponsors of the event included:
Gold Sponsors
- ArvinMeritor Light Vehicle Aftermarket
- Federal-Mogul Corp.
- Morse Automotive Corp.
Silver Sponsors
- Aftermarket International
- Airtex Products, Division of UIS
Inc.
- Browne Dreyfus International Ltd.
- CARDONE Industries
- Chemplex Automotive Group Inc.
- Cloyes Gear & Products Inc.,
Dynager Timing
- Corteco, the Aftermarket Business
of Freudenberg-NOK
- Cyclo Industries LLC
- Dana Corp., Heavy Vehicle Technologies
Systems Service
- Dana Global Sales
- Delta Automotive Inc.
- Dorian Drake International Inc.
- Gates InterAmerica, a branch of the
Gates Corp.
- Honeywell-BENDIX
- Intraco Corp./The Casite Co.
- JDS Global Corp.
- JF Heavy Duty Parts Sales
- Liberty World Trade Inc.
- Lindeco International Corp. (LGP)
- Melling World Trade, a Division of
Melling Tool Co.
- T & J New Pumps Inc.
- Top Oil Products Co.
- Transtar Industries Inc., International
Division
- U.S. Motor Works LLC
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First-Ever Aftermarket Suppliers
Forum Created
MEMA's aftermarket segment association,
the Automotive Aftermarket Suppliers Association (AASA),
has created the European Aftermarket Forum to provide
a forum for its member companies' senior executives
who head-up their European aftermarket operations to
meet and discuss industry issues and solutions, share
best practices and network among peers.
Membership is limited to aftermarket
product manufacturers who are members of MEMA/AASA with
European operations. To assure maximum participation
membership is limited to 40 of the most senior executive
members who run the members European aftermarket business.
The goals of the Forum include:
- Meet to discuss important aftermarket
issues, share information, discuss and develop positions
and actions.
- Networking opportunity for aftermarket
suppliers' senior executives.
- Benchmark vital statistics to determine
performance assessments.
- Establish positions and direction
for aftermarket legislation via CLEPA (pan European
supplier OE association).
- Establish programs/services to support
aftermarket suppliers (market research, supply chain
issues, peer councils, MIS, credit, etc.).
The group meets quarterly at a mutually
agreed upon time and location and determines each meeting
format.
"The EAF is a peer group that
promotes open dialogue and requires trust and relationship
building," said AASA Vice President Paul Foley,
who manages heads the Forum. Foley noted that splinter
committees may be formed to work on specific issue resolution
and that speakers are invited periodically to meet with
the group to address specific subjects of interest.
For more information, contact Paul
Foley at 919-406-8840 or pfoley@mema.org.
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2004 'World Automotive Market
Report' To Be Available Soon
Compete …. Innovate …. Diversify
…. Be in the know about the world automotive industry.
To be a player in the global market,
a global program is important. Arm your company with
the knowledge you need to compete effectively.
Now in its 74th edition, the "World
Automotive Market Report" is one of the industry's
oldest and most respected global statistical analyses.
Published by the Overseas Automotive Council, the "World
Automotive Market Report" includes statistics on:
- Vehicle production and assembly
- Vehicle census summary
- U.S. automotive parts trade
- World trade in new vehicles
- World motor vehicle markets
OAC members and members of MEMA's
market segment associations receive one copy of the
"World Automotive Market Report." Extra copies
can be ordered at the special reduced price of $75 by
e-mailing publications@mema.org.
Nonmember price is $200 per copy.
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Supplier News
***Delphi Begins Work on Technical
Center in China
Delphi Corp. has begun work on its
first R&D center in China. The wholly owned China
Technical Center is expected to open in June 2005 and
will employ around 500 engineers, scientists and technical
professionals.
***Goodyear Expanding in Colombia
Goodyear is investing $50 million
to expand its manufacturing operations at Cali in Colombia
in order to add radial medium truck tires to the facility's
output. The first phase of the expansion should be commissioned
by 2006, and a considerable portion of the extra output
will be destined for other Latin American markets, as
well as Mexico.
***Lear Completes Acquisition of
Grote & Hartman
Lear Corp. has completed the acquisition
of GHW Grote & Hartmann GmbH, manufacturers of electrical
components at Wuppertal in Germany. Lear says that the
takeover supports the company's strategy to grow its
electronics and electrical distributions systems and
to further diversify its product portfolio.
***Visteon Opens Two New Technical
Centers; To Build New Plant
Visteon Corp. has opened a new technical
center at Novy Jicin in the Czech Republic to provide
engineering solutions for climate control and engine
cooling components and systems and lighting. The new
facility houses climate control product planning, core
development, product design, process engineering, simultaneous
engineering and engineering change teams as well as
a prototype shop.
Visteon also has opened a new technical
center in Chihuahua, Mexico. The 5,000-square-meter
facility will accommodate 200 engineers, technicians
and other staff who will concentrate on specific needs
for vehicle component design activities and administrative
operations in the region.
Visteon also announced that it will
invest close to $50 million in a new manufacturing facility
in Nitra, Slovakia, which will be intended to support
new business with Kia and PSA Peugeot Citroën.
The facility will manufacture automotive interiors and
climate control systems. Production is scheduled to
begin in spring 2006, and the site is expected to eventually
house about 400 employees.
***ArvinMeritor Opens New Plant
in Poland; Agrees to Joint Venture
ArvinMeritor conducted a dedication
ceremony for a new Light Vehicle Systems Customer Value
Center in Swarzedz, Poland. The plant will produce 200,000
door modules a year for supply to Volkswagen for the
Caddy that is produced at Poznan.
The company, through its Commercial
Vehicle Systems (CVS) business group, also announced
the signing of a licensing agreement with Raydan Manufacturing
Inc., of Alberta, Canada, for the patented Air Link
rear tandem suspension product line. The exclusive agreement
begins a long-term global collaboration between the
two companies authorizing ArvinMeritor to market, engineer
and manufacture the Air Link rear suspension product
line, up to and including 52,000 lb. gross tandem weights,
for commercial truck, trailer, specialty and military
OEMs. Raydan will continue to manufacture the suspension
for crane chassis, custom retrofit and all applications
above 52,000 lb. gross tandem weight.
***Cooper Tire in Joint Venture
in China
Cooper Tire & Rubber Co. formed
a joint venture company with Saiyang Sealing Products
Co. of China for the manufacture and sale of automobile
sealing systems under the name Cooper Saiyang Wuhu Automotive.
The joint venture facility is located in the Wuhu Economic
Development Zone, southeast of Nanjing. The plant has
complete rubber mixing capabilities as well as four
extrusion lines to produce rubber, rubber/plastic or
plastic sealing extrusions.
***Hella Recorded Modest Growth
in Fiscal 2004
Hella revealed that sales growth for
the fiscal year that ended May 31, 2004, had risen by
1.9 percent to $3.95 billion from $3.87 billion. Profits
figures were not released. Sales in Europe excluding
Germany had risen by 13 percent to $9.77 million from
$8.65 million and in the Asia/Pacific region by 6.3
percent to $193 million from $181 million. In Germany,
the turnover was kept steady in what was described as
being a generally difficult economic climate at 0.2
percent to $2.39 billion, an increase of $4.78 million.
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OEM News
***Toyota Boosts European Sales
by 15 Percent to New Record
Toyota broke the half-million barrier
in Europe for the first time ever in a half-year when
sales rose by 15 percent to 502,016. That lifted Toyota's
share of light vehicles sold in Europe to 5.1 percent
from 4.7 percent. Toyota was hoping to beat the previous
all-time best for full-year sales in Europe of 860,000
vehicles.
***General Motors Sets New Sales
Record in China
General Motors has stated that sales
for its brands in China had risen by 57.6 percent in
the first half of 2004 to 259,653 vehicles. Shanghai
General Motors Co. Ltd. registered a year-on-year increase
in sales of 92.4 percent to 141,319 units. Sales at
SAIC-GM-Wuling Automobile Co. Ltd., GM's minivehicle
joint venture in China's Guangxi province, rose 32.5
percent to 115,938 units.
***Kia, Volkswagen Plans Assembly
in Iran
Volkswagen is to establish an assembly
plant in the Special Economic Zone Arg-e-Jadid, near
Bam. The plant should start assembly of the Brazilian-sourced
Gol before the end of 2004. Initially the plant will
only deal in CKD operations, but there will be room
to expand to actual manufacturing should the initial
venture prove successful. The Gol will be assembled
by BAMCO, a subsidiary of Kerman Automotive Industries.
Volkswagen sees Iran as a market due for sustaining
the high growth rates that have been evident over the
past five years.
Kia Motors Corp. announced that its
Rio compact sedan will be assembled and sold in Iran
beginning early in 2005. Under the agreement between
Kia and its Iranian partner, Saipa Corp. - which already
locally produces the Kia Pride subcompact model - Saipa
will assemble the compact Rio SF sedan from KD packs.
Saipa is currently upgrading and converting the Tehran
plant to cater for 300,000 cars a year, of which 100,000
will be the Rio and 200,000 the Pride.
***Mazda Models to be Built by
Ford in China
Mazda Motor Corp. announced that Changan
Ford, a joint venture between Ford Motor Co. and Changan
Automotive Group, has signed an investment agreement
to purchase land at the Jiangning Economic & Technological
Development Zone (NJDZ) for its second manufacturing
plant. The new plant will build Mazda models. Details
of which vehicles will be manufactured at the plant
will be announced later.
***DaimlerChrysler Achieves Record
Sales in China
DaimlerChrysler said that sales of
vehicles in China rocketed by 173 percent in the first
half of 2004 to a new record of 22,000. The company
also said that Beijing Jeep expects sales to double
to 40,000 vehicles in 2004. To further establish its
presence in China, DaimlerChrysler and BAIC are planning
to produce Mercedes-Benz passenger cars to around 25,000
C and E Class vehicles annually.
***Toyota to Assemble Cars in Russia
News reports suggest that Toyota plans
to build an automobile plant in Russia in 2008 that
will make about 15,000 vehicles a year. It is suggested
that Toyota will invest $90 million to handle KD assembly
of the Corolla and Camry models. Although not yet officially
confirmed by Toyota, the reports do make some sense
as Toyota has been following a steady expansion plan
across the whole of Europe for the past decade or so.
Output of Toyota vehicles first occurred in Europe in
Portugal, but since then there have been vehicle or
engine plants established in the UK, France, Turkey
and Poland. With Toyota currently enjoying reasonable
success in Russia with imported models, it is more than
likely that assembly or production will follow quite
soon.
***Isuzu Claims World Leadership in Truck Production
According to figures assembled and
released by Isuzu, not only did the Japanese company
overtake DaimlerChrysler in 2003 with regard to worldwide
production of medium and heavy duty trucks, but other
Japanese truck manufacturers such as Hino, Mitsubishi
Fuso and Nissan Diesel also enjoyed strong levels of
growth in 2003 compared with 2002.
According to the Isuzu figures, its
output in 2003 totaled 86,354, an increase of 29.1 percent
from 66,868 in 2002. In contrast, build levels at DaimlerChrysler
rose by a slower 8.4 percent to 84,507 from 77,959.
Freightliner was third with output up 7 percent to 73,515
from 68,723, while Hino moved up four places into the
No. 4 slot after boosting output by 56.9 percent to
60,019 from 38,255. Mitsubishi Fuso recorded 47.1 percent
growth to 58,622 from 39,831, and Nissan Diesel enjoyed
a 50.9 percent surge to 34,959 from 23,169.
***Mercedes-Benz Exceeding U.S.
Diesel Car Targets
Mercedes-Benz did not expect earth-shattering
sales results when it launched its E320 CDI in the U.S.
market back in April and set a sales target of only
3,000 for 2004. However, it achieved that figure after
only five months.
***Renault Plans a New Spare Parts
Distribution Center in France
Renault is to build a new 150,000-square-meter
central warehouse in Sens-Villeroy in Burgundy. Should
demand dictate, there will be room for further expansion.
The first 100,000 square meters of storage space in
the new facility would gradually come into operation
in several phases between September 2006 and February
2007. A second 50,000-square-meter building could be
operational by December 2007. The warehouse would store
the most widely sold parts families and would eventually
employ more than 300 people.
***Toyota Aiming for 900,000 European
Sales in 2004
Toyota, currently the most successful
player in Europe in terms of volume sales gains, has
again raised its sales target for the full year. Toyota
had originally considered that 860,000 was a realistic
target for full-year 2004, which would have been an
all-time record, but the company says that light vehicle
sales to August were 12 percent ahead at 628,664, with
passenger car sales rising by over 41,000 units to 500,268.
Toyota has announced that the new small car that is
to be produced at the joint venture plant with PSA Peugeot
Citroën in the Czech Republic will be called the
Toyota Aygo when it enters production in 2005.
***GM to Chop 12,000 Jobs in Europe
General Motors announced its intention
of slashing its European operating costs by $640 million
a year, resulting in the loss of 12,000 jobs, most of
them in Germany and most of them in the year 2005. With
General Motors turning to its Asian operations for its
entry level cars for Europe - to be made mainly by Daewoo
but badged Chevrolet - the pressure is on European operations
to cut costs and return to profitability, having declared
losses every year since 1999. GM confirmed that although
cost reductions are essential in Europe, the plans are
still in place for the 2005 production launches of the
Opel/Vauxhall Astra GTC, the Zafira monocab, and the
Saab 9-3 Sport Hatch.
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