By: Benjamin Glick
After a period of flagging growth, North American auto sales are expected to surpass 18 million vehicles in 2016. With such record numbers, tremors will follow as the industry shifts from traditional models toward new market realities that are still emerging.
With this sudden evolution of innovative technologies and uptick in demand, it seems the industry is poised for unfettered growth, and it is sending suppliers scrambling to attract the attention of major manufacturers.
Fulfilling current demand won’t be enough. Learning what companies will want in the coming years as the industry continues to change will be essential to any future success. From addressing the growing skills gap to identifying new trends in the industry, a wealth of knowledge will be presented on March 10, 2016, for the 17th West Michigan Automotive Suppliers Symposium in Grand Rapids, Michigan.
Considering the topics being presented by this year’s experts from Toyota, IHS, Primera Plastics and MOTUS Integrated Technologies, this year’s symposium is one not to be missed.
Mergers and Acquisitions
Increases in sales, falling oil prices, and an overall improving economy, has injected much-needed cash into many large companies’ bottom lines. This volatility has freed up a lot of capital for original equipment manufacturers (OEM’s), and has created an appetite for new suppliers.
According to PricewaterhouseCoopers, a New York-based consulting and tax service, estimated supplier mergers and acquisitions totaled $48 billion in 2015, overtaking the previous high of $35 billion in 2007.
Most of this activity has been generated by the acquisition of automotive suppliers in an attempt to strengthen a fragile supply chain, and find suppliers that can fulfill new technological demands.
What these first and second tier enterprises supply that large manufacturers want will be key to unlocking future success in the industry.
Companies learning how to emulate these successful models can take advantage of current market conditions to gain the attention – and capital – of large manufacturers.
Chris Hall, vice-president of corporate strategy for MOTUS Integrated Technologies, will lend his analysis of these trends in his Global Landscape Update and identify where they are going.
Solving the Skills Gap
West Michigan’s economy is growing quickly. Forbes frequently places Grand Rapids in the top 25 cities in the U.S. for businesses and careers, and the city ranks ninth in terms of job growth.
The Grand Rapids Metropolitan area is expected to grow by 2.3 percent this year, slightly above the national average of 2.2%. But with this growth comes a problem, and that is finding qualified candidates to fill these open positions.
The region and the state at large are not unique in this respect. Skilled labor, it seems, is in low supply anywhere where manufacturing is present.
In the U.S., there are 600,000 unfilled skilled manufacturing jobs, and this skills gap is only going to get worse. Over the next decade, the number of these unfilled positions is expected to grow to 2 million, threatening American competitiveness.
Noël Cuellar, owner of Zeeland-based Primera Plastics, knows this reality all too well and is looking forward to sharing his strategy on what local manufacturers can do to cultivate local talent right here in Michigan.
Automotive Industry Outlook
From emerging technologies to falling oil prices, what forces will shape the automotive industry in the coming years? And what trends should suppliers, manufacturers, and buyers pay attention to?
The changing face of the auto industry has been an evident theme running up to the symposium, and knowing where those changes will occur is a valuable insight.
Mike Wall, director of automotive analysis for IHS Automotive will help to make these trends clear, and identify what areas of importance the industry should keep an eye on and how current trends may pan out.
Keynote Address: Toyota
In 2014, Toyota announced it would be moving it’s North American headquarters, and 4,000 jobs, from Torrance, California to Plano, Texas.
In addition, the world’s largest automotive manufacturer also outlined a plan to double the size of its research and development operations in Ann Arbor, Michigan, investing $126 million and 300 direct-procurement and supplier engineering jobs.
The Japanese company’s great shift eastward has many in Michigan excited about what it could mean for the state’s economy and the automotive industry at large.
Deb Schroeder, purchasing general manager for Toyota Motor Engineering & Manufacturing North America (TEMA) will be giving the day’s final and perhaps most anticipated keynote address.
According to many reports, the reason behind the company’s move was to relocate development operations closer to America’s automotive epicenter.
Toyota’s move is being framed within a general trend of auto companies relocating to southeast Michigan. It should be no surprise, given the area’s history. The growth in these white collar automotive activities has resulted in one of the largest industrial brain trusts in the world, according to Forbes.
What lays in the future for the region may depend on how well Toyota performs, but in any case, the move is seen a welcome addition to Michigan’s automotive community.
Preserving and Growing Businesses
“In the current environment, OEM’s are increasingly tapping their suppliers to help reimagine the car as we know it today: greater fuel efficiency, electronics for safety, electrification,” said Bob Pekrul, Partner at Plante Moran, the symposium’s title sponsor.
“These dramatic changes have huge implications for suppliers looking to not just stay relevant, but also to preserve and grow their business,” Pekrul said.
The 17th West Michigan Automotive Suppliers Symposium: Powering the Pipeline will be held March 10, from 8 a.m.-noon, in the Loosemore Auditorium on Grand Valley’s Pew Grand Rapids Campus.
This yearly event brings together business owners, senior management, and decision makers from all tiers of the industry, providing the most up-to-date automotive forecasts, and revealing trends and opportunities.
Benjamin Glick is a student assistant at the Van Andel Global Trade Center. He has written for the Grand Valley State University student newspaper, The Lanthorn, and is double-majoring in English literature and journalism.