The Automotive Communities Program The Automotive Communities Program Sean P. McAlinden, Ph.D. Vice President of Research and Chief Economist Center for Automotive Research (CAR) Ontario Mayors for Automotive Investment Cleary International Centre Windsor, ON October 6, 2006
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The Automotive Communities Program - Windsor · 2012-01-17 · The Automotive Communities Program • Funded for Development by the Mott Foundation • Based at Center for Automotive
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The Automotive Communities ProgramThe Automotive Communities Program
Sean P. McAlinden, Ph.D.Vice President of Research and Chief Economist
Center for Automotive Research (CAR)Ontario Mayors for Automotive Investment
Cleary International Centre
Windsor, ONOctober 6, 2006
Motor Vehicle Production by Country, 2005
Millions of Units 11.98
10.80
5.76 5.71
3.70 3.552.75 2.69 2.53
1.80 1.67
0
2
4
6
8
10
12
14
US Japan Germany China S. Korea France Spain Canada Brazil UK MexicoSource: OICA, Ward’s Automotive
It’s All About Product…..
North American Production By Country Year to Date August 2006
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
8.00%
9.00%
10.00%
11.00%
12.00%
13.00%
14.00%
15.00%
16.00%
17.00%
18.00%US Production
Canada
Mexico Production
Canadian % Of North AmericanProduction
(In M
illio
ns)
North American Production By Country Year to Date August 2006
70.00%
72.00%
74.00%
76.00%
78.00%
80.00%
82.00%
84.00%
86.00%
88.00%
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
20.00%U.S. % Of North American Production
Canadian % Of North AmericanProductionMexican % Of North American Production
Canada Becomes More Expensive
1.11
1.60
1
1.1
1.2
1.3
1.4
1.5
1.6
1.7
Jan-99Ju
l-99
Jan-00Ju
l-00
Jan-01Ju
l-01
Jan-02Ju
l-02
Jan-03Ju
l-03
Jan-04Ju
l-04
Jan-05Ju
l-05
Jan-06Ju
l-06
CDN $
U.S. $ Down 31% Against the Loonie
The Automotive Communities Program• Funded for Development by the Mott Foundation• Based at Center for Automotive Research• Program is beginning its FIFTH YEAR of assisting communities• A Joint Industry-Community Information Outreach and Conference
Program• Self-funded through Community Contributions
• Top Five N. American Vehicle Firms and 8 of the Largest Suppliers (GM, Ford, DCX, Honda, Toyota)
• Only program of its kind bringing multi-national communities and auto companies together to address common issues related to the ever-changing automotive industry
• To serve as a not-for-profit auto advisory and information service to traditional automotive communities
• Provide real time communication with automotive firms – and contacts
• Advise communities on local policies that impact auto renewal.• Share product change and opportunity information• Perform impact joint research
ACP Assistance to Specific Communities
Ontario
MO
MI
INOH
IL
The ACP Region
OEM and Supplier Facilities
ACP Member Communities 2006 - 2007Ministry of Economic
Development & Trade - Ontario
Canada
Windsor-Essex County
Development Commission
London Economic
Development Corporation
Greater Toronto Marketing Alliance
Nottawasaga Futures
Canada's Technology
Triangle
The Indy Partnership
Allen County Department of Planning (IN)
South Central Indiana
Economic Development
Group
Town of Normal (IL)
The Right Place, Inc.
Bay Future, Inc. (MI)
City of Bay City (MI)
Saginaw Future Inc.
Michigan Economic
Development Corporation
(MEDC)
Flint-Genesee Economic
Growth Alliance
Economic Development Alliance of St. Clair County
(MI)
Missouri Department of
Economic Development
St. Louis Regional
Automotive Partnership
City of Hazelwood (MO)
City of Fenton (MO) City of Wentzville
(MO)
Regional Growth
Partnership (Toledo, OH)
Ohio Department of Development City of Lima (OH)
Wood County Economic
Development Commission
(OH)
Defiance County Economic
Development (OH)
Perry County Development
Corporation (IN)
Indiana Economic
Development Corporation
City of Ft. Wayne
Grant County Economic
Growth Council(IN)
Project Future -Economic
Development for South Bend, etc.
ACP Member Companies/Utilities/Misc. 2006 - 2007
Consulate General of
Canada
Indiana Municipal Power Agency (IMPA)
American Electric Power (AEP) Hoosier Energy Duke Energy CMS Energy
FirstEnergy
Denso International America, Inc.
Federal-Mogul Corporation
Ford Motor Company
General Motors Corporation
Honda of American Mfg.
Inc.Lear Corporation
TRW Johnson Controls
ArvinMeritor, Inc. DaimlerChrysler Corporation
Dana Corporation
Toyota Motor Manufacturing
Inc.
Delphi Corporation
Three Major Activities
• Automotive Information Outreach
• Automotive Communities Studies
• ACP Membership Meetings Forums
Automotive Information
• Industry updates• Product timing information• Investment and dis-investment alerts• Database and analysis of major automotive investments• Partners with JD Power, CSM Worldwide, Elm Intl., Polk• Major supplier contract activity• Arrangement of special meetings• Significant technology developments• New productivity developments
Major automotive investments from 1993-2005
Source: Book of Deals, CAR
4 out of Top 10 Global Transportation Sector Investments are in ACP Region--2005
What Are a Company’s Options?
1 Close
2 “Warm Idle”
3 Update current products
4 New Product(s)
5 ??????
Lessons Learned
• Strong and persistent leadership• Building partnerships• Focus on industry & job retention
– Success produces new jobs/investment• Maintaining the right business environment• Adopt proactive strategies• Automotive Action Groups
ACP Meetings to Date• January 22, 2003 - General Motors World Headquarters, Detroit, MI• May 28, 2003 - Daimler Chrysler Technology Center, Auburn Hills, MI• August 3, 2003 - Grand Traverse Resort, Traverse City, MI (MBS)• October 28, 2003 - Ford World Headquarters, Dearborn, MI• December 16, 2003 - Delphi Corporation, Troy, MI
• May 10, 2004 - General Motors World Headquarters, Detroit, MI• August 2, 2004 - Grand Traverse Resort, Traverse City, MI• November 9, 2004 – Johnson Controls Inc., Plymouth, MI• January 19, 2005 – Automotive News World Congress, Detroit, MI• April 29, 2005 – Denso Manufacturing Michigan Battle Creek, MI
• August 3, 2005 – Grand Traverse Resort, Traverse City, MI (MBS)• September 7, 2005 – Honda of America Manufacturing, Marysville, OH• January 11, 2006 – Cobo Hall, Detroit, MI (North American Intn’l Auto Show)• April 13, 2006 – Toyota Motor Manufacturing, Princeton, IN
• June 28, 2006 – Dana Corporation, Maumee, OH• August 9, 2006 – Grand Traverse Resort, Traverse City, MI (MBS)• October 12, 2006 – Ford World Headquarters, Dearborn, MI• January 2007 - TBD
Stuck on a Plateau or Worse! Total U.S. Sales of Light Vehicles:
Source: Kim Korth, IRN presentation to OESA 2005 Nashville Regional meeting
1999 2000 2001 2002 2003 2004 2005
BREED Technologies
(9/99)
Key Plastics(3/00)
Cambridge Industries(5/00)
Mexican Industries
(7/01)
A.G. Simpson(10/01)
Federal Mogul(12/01)
Harvard Industries(2/02)
DCT(8/02)
GenTek(10/02)
Exide Technologies
(4/02)
Talon Automotive
(7/01)
Hayes Lemmerz(12/01)
Aetna Industries(2/02)
Insilco(1/03)
Valeo(1/02)
Venture Industries
(5/03)
Atchison Casting(8/03)
Precision Tool & Die
(12/03)
Veltri Metal(1/04)
Citation(9/04)
Amcast Industrial(12/04)
Oxford Automotive(12/04)
Intermet(11/04)
Tower(2/05)
Collins & Aikman(5/05)
Meridian(4/05)
EaglePicher(4/05)
2006
Dana(3/06)
Delphi(9/05)
Hayden(2/06)
Major Supplier Bankruptcies . . .and now the largest, Delphi, and another large one, Dana
?
So . . .GM Will be the Size of Ford, and Ford the Size of Chrysler
and Chrysler the Size of . . .
6.2
4.3 4.63.3 3.1
3.2
0
1
2
3
4
5
6
7
8
GM-2004 GM-2008 Ford-2004
Ford-2010
Chrysler-2004
Chrysler-2008
Mill
ions
(Capacity equal to the size of Chrysler will be closed . . . (Capacity equal to the size of Chrysler will be closed . . . About 22% since 2004, or 3.2 mil. units.)About 22% since 2004, or 3.2 mil. units.)
2004-2010 Change in North American Vehicle Production Capacity
Approximate National Automotive Manufacturing Multiplier
of
6.5 U.S. Jobsfor each Job at a
U.S. Motor Vehicle Firm
Source: Contribution of the U.S. Motor Vehicle to the Economies of the United States, California, New York, and New Jersey, Center for Automotive Research, 2003, Contribution of Toyota to the Economies of Fourteen States and the United States in 2003, Center for Automotive Research 2005