Key Issues Car Industry

1
Key Issues Car Industry
Summer School IPC Cyprus, september 2008
2

• Market
• -4 in Europe so far -16 in august only
• Dramatic shift from large SUVs to small cars
• Detroit-3 in struggle to survive
• Mass redundancies
• Introduction two-tier wage system
• Health care and pension obligations transferred
  to the UAW (creation of VEBAs)
• Low-interest loan package with state-guarantee of
  25 billion to be approved by the Congress
• Strategy
• From regional to global platforms
• From platforms to architectures
• White cars Logan, Nano
• Challenge small is beautiful and profitable

3
Take-overs and strategic alliances

• De-merging unravelling of DC Chrysler now owned
  by pe-funds (Cerberus)
• Take-overs
• Scania by VW
• Zastava by Fiat
• Jaguar and Land Rover by Tata
• FSO Warschau by GM
• Daewoo Craiova by Ford
• Germany
• Porsche 35 in VW but heading for majority
  depending
• Schaefler secured creeping control of Continental

4

• Joint ventures, strategic alliances
• Magna and Avtovaz to produce ultra-cheap cars in
  Russia
• Fiat will produce the Ford Ka in Poland
• Renault 25 in Avtovaz (Lada)
• Chery-Chrysler and Chery-Fiat to produce small
  cars in China

5
Restructuring

• Renault -6000 (second shift in Sandouville)
• BMW en PSA -8000
• Volvo third shift in Törslanda
• Closure of Ford Blanquefort in 2010 (-2.500
  employees)
• Karmann -1800 in Germany
• GM -4000 in Europe

6
Globalisation every year 5-10 plants are closed
and 10-15 new plants are set up

• New Detroits
• St.Petersburg GM, Ford, Toyota are already
  there, Hyundai, Nissan and Suzuki are planning
• Chennai Ford, BMW, Hyundai, Nissan
• Czech Republic and Slovakia
• New Renault-factory by Renault in Marocco
• New Daimler-plant (compact crossovers) in
  Kecksemet (Hungary)
• New VW-factory in Tennessee

7
Sustainable development

• Technological breakthrough for electrical cars
  (plug-ins based on lithium-ion batteries)
• CO2
• Compromise in the industry committee of the
  Parliament on gradual phasing in between
  2012-2015, but not in the
• Vote in the EP on 22/10
• Final approval by Council in december
• Ford is developing Product Sustainability Indexes
  for its new models
• Volvo Trucks has set up CO2-free factories

8
Industrial policy

• Failure of DOHA
• Assessment by the EC of the car block exemption
  in order to prepare a new regime from 6/2010 on
• EMF-Clepa project on anticipation of change in
  the automotive industry
• Anticipation of change
• Skills needs
• Territorial implications

9

• Stakeholder consultation on Cars21
• Cars21 better regulation, internal market,
  safety, trade, RD, taxation, environment
• EMF
• Better regulation is not deregulation but
  enforceable regulation
• International harmonisation of rules is okay but
  Europe should remain a driver for higher
  standards
• Improve support to the rest of the supply chain
  (RDI)
• Joint Technology Initiative on electrical cars
• Take up Knowledge management (eg learning
  organisation)
• Better involvement of DG Employment and DG
  Environment
• Extend the use of the Globalisation Adjustment
  Fund
• What about the 10-year roadmap