2019 Center for Automotive Research Annual Report

Hello friends,

 

On behalf of the team at CAR, I want to thank you for your support. The engagement and support of the automotive industry have been fundamental to the success of the Center for Automotive Research since our founding as an independent nonprofit in 2003.

This year, CAR recognizes its 16th anniversary as a standalone nonprofit organization.  Our mission remains:

To conduct independent research and analysis to educate, inform and advise stakeholders, policymakers, and the general public on critical issues facing the automotive industry, and the industry’s impact on the U.S. economy and society.

As an independent, non-profit, research organization with a multi-disciplinary approach, CAR engages with leaders in the global automotive and mobility industry to support technology advancements and improve the competitiveness of the U.S. automotive industry. We succeed through close collaboration and strong relationships with automakers, suppliers, industry associations, educational institutions and government, non-profit, and labor organizations.

Many people are familiar with our flagship conference, the Management Briefing Seminars, which takes place each year near Traverse City, Michigan. CAR’s research is the engine that drives the conference, and all of our other work. The automotive industry is increasingly dynamic. We understand that as automotive manufacturers and suppliers working to shape the future, you must still meet near term goals in an uncertain business and regulatory environment. CAR’s research supports your efforts and provides critical insights to help you achieve your goals and to further the success of the automotive industry.

This report provides an overview of the research completed by CAR in 2019. It is not an exhaustive list, and there are new topics of research that will need to be explored in 2020 and beyond. We value your input into shaping those topic areas. Our work is collaborative, and it is through the unique position that CAR holds in the industry that we work together to enhance the success of the automotive and mobility industry.  Wishing you all the best to you in 2020.

Kind regards,

Carla Bailo
President & CEO

CAR RESEARCH

CAR conducts leading-edge research that impacts the future of the global automotive industry by informing corporate leaders and policymakers and facilitating communication across all stakeholders in the industry.

2019 RESEARCH:

Trade Briefing: U.S. Consumer & Economic Impacts of U.S. Automotive Trade Policies

FEBRUARY  |  U.S. trade policy changes are projected to raise consumer prices for new and used vehicles and lower U.S. light vehicle sales, employment, and economic output. The Center for Automotive Research (CAR) estimates that the cumulative effect of current and potential U.S. trade actions on automobiles and auto parts could cause new car prices to rise by USD 2,750 on average. CAR estimates that the price of even U.S.-built vehicles could increase as much as USD 1,900 due to the current share of imported parts content, and imported vehicle prices could rise by as much as USD 3,700. The vast majority of the estimated price impacts are attributable to the potential auto and parts tariffs that the Administration is considering imposing under Section 232 of the Trade Expansion Act of 1962, as amended.

CAR’s analysis assumes that Canada, Mexico, and South Korea would be exempt from potential Section 232 auto and parts tariffs and based on the Korea-United States free trade agreement (KORUS) and exemptions from Section 232 auto and parts tariffs for Canada and Mexico that were agreed to in side letters to the USMCA that was signed in November 2018.

Rather than help the U.S. automotive and parts industries, the cumulative effect of the Section 232 steel and aluminum tariffs, Section 301 China tariffs, USMCA, and the potential 25 percent Section 232 tariff on imported autos and auto parts could lead to a 1.3 million drop in U.S. light vehicle sales, 366,900 fewer U.S. jobs, and $30.4 billion lower U.S. economic output (Gross Domestic Product). U.S. new automobile dealerships could lose as many as 77,000 jobs and $43.6 billion in revenue.

Used vehicle prices will also rise due to heightened demand and constricted supply, and higher automotive parts prices will drive up the price of vehicle maintenance and repair, so even holding on to an existing vehicle will become more expensive.

Fuel Economy and Greenhouse Gas Regulation in the United States

MARCH  |  CAR produced a 5 – part review of key elements of the proposal and put the possible outcomes into context. On August 2, 2018, the US Environmental Protection Agency (EPA) and the National Highway Safety Administration (NHTSA) jointly published the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026. The Joint Notice of Proposed Rulemaking (NPRM) gave much-awaited guidance for future emissions and fuel economy regulation. In this series, CAR presents a multi-part review of critical elements of the proposal and puts the possible outcomes into context.

 

Advancing Additive Manufacturing into the Mobility Industry

MARCH  |  Future cities will likely be dominated by automated, connected, electric, and shared (ACES) vehicles. Automotive customers are demanding greater vehicle personalization and unique ride experiences. Additive Manufacturing (AM) is a revolutionary group of technologies that can help automakers cater to the desires of their customers by providing unique solutions for vehicle design, manufacturing, and the overall automotive business. However, for advancing AM towards applications in automotive mass production, AM’s inherent challenges must be addressed. To obtain an industry perspective, CAR organized brainstorming sessions with representatives from multiple automakers and suppliers to discuss the advancement in AM, challenges to incorporating its adoption, and the path forward.

Roof Lightweighting Study

JUNE  |  The CALM team selected the roof structure for a lightweighting study to highlight the possibilities of mixed-material for mass reduction. Three concepts were compared to the 2011 Honda Accord roof in mild steel as the baseline. With the latest generation steels, the mass reduction was 22%. With a mix of steel, aluminum, and composites, the mass reduction was 39%. The all-composite design reduced the mass by 40%. Optimizing other parts and systems such as tires, wheels, powertrain, suspension system, braking system, bumpers, fuel and exhaust systems, steering system, and electrical systems and wiring can achieve secondary mass reduction. Future research could include an all-aluminum design, side-impact analysis, and a moon roof design.

Technology Roadmap: Intelligent Mobility Technologies

SEPTEMBER  |  The automotive, transportation, and mobility industries have experienced transformative changes due to advancements in connectivity and automation technologies, data analysis, and the rise of new mobility services. With such rapid changes in the industry’s landscape, an understanding of where technological development is at present and where it is likely headed is helpful to guide future decision-making.

With funding from the MEDC, the Center for Automotive Research (CAR) has prepared this technology roadmap based on internal research and a thorough analysis of available industry reports. CAR researchers vetted the study conclusions with critical input from a group of subject matter experts.

Technology Roadmap: Materials and Manufacturing

OCTOBER  |  This report forecasts materials and manufacturing trends based on the CAR team’s research findings as well as input from subject matter experts. The results show that several factors can affect the industry’s progress on material technology in the coming decades, including fuel economy regulations, added weight due to batteries, advanced driver assistance systems (ADAS), comfort features, increasing durability requirements for shared vehicles, and safety. CAR researchers found that vehicle lightweighting will remain a top priority for the industry as automakers strive to use the right materials for the correct application promoting mixed-material body structures.

With funding from the Michigan Economic Development Corporation (MEDC), CAR has prepared this technology roadmap based on internal research and a thorough analysis of available industry reports. CAR researchers vetted the study conclusions with critical input from a group of subject matter experts.

Automation Adoption & Implications for the Automotive Workforce 

NOVEMBER  |  Many automakers and suppliers continue to face both challenges and opportunities as the automotive industry progresses through an era of rapid innovation as automation and artificial intelligence in the manufacturing setting continues to advance. Automotive companies widely report difficulty in finding enough qualified, skilled employees. Meanwhile, automation and artificial intelligence could potentially revolutionize manufacturing and change both the number of future workers required and the skills those people will need to possess.

With funding from Case Western Reserve University, CAR prepared this report summarizing a benchmarking survey conducted across over 120 firms. The survey was conducted by Case Western Reserve University in partnership with Boston University, CAR, New York University, Precision Metalforming Association, and multiple part supplier associations. The survey investigated two questions: 1) what drives the adoption of new technology in the manufacturing setting, and 2) how do a firm’s relationships with technology and its employees affect this adoption.

CAR FEATURE STORIES

CAR researchers produce feature stories throughout the year to cover critical issues that are impacting the industry today, while also addressing topics that may impact the future.

HOT TOPICS IN 2019:

NAFTA/USMCA, Trade, & Tariffs

The U.S. administration’s ever-shifting trade policies involving every major U.S. trading partner are creating a deadweight loss in the auto industry. Companies are spending time and money building up inventories, realigning their supply chains, hiring trade analysts and compliance specialists, and readjusting their corporate strategies. All of these efforts and dollars could be better spent by investing in people, manufacturing, and R&D that would make U.S. automakers and suppliers even more innovative and globally competitive.

 

UAW Negotiations

The significant economic issues in every UAW-Detroit Three negotiation include labor costs and the components thereof: wages, and benefits—especially health care insurance. Job and income security, sourcing, and the use of temporary workers in the plants are also top UAW concerns. In an era of solidly profitable operations, the automakers seek to contain labor cost growth while the UAW looks to make economic gains and secure its members’ jobs and future income.

 

Talent and Training

In a recent CAR study, over 80 percent of survey respondents listed workforce issues as one of their top three challenges to adopting new technology at their plants. New technologies are coming not only to cars, utility vehicles, and trucks but also to the manufacturing plants that produce parts, components, and vehicles. Due to the rapid pace of innovation across the automotive industry, academic institutions are struggling to advance curriculum to match in-demand skills from the industry. Educational institutions and industry need to partner with one another to close the talent gap for the future workforce.

 

Economy

The cyclical nature of the auto industry means that record years and healthy profits often instill worry instead of celebration among industry leaders—after all, what goes up, must come down. The good news is that the fed has lowered the federal funds target interest rate twice this year in response to a weakening global economic outlook, U.S. & Japan signed a limited trade agreement, USMCA ratification is moving forward, but may not happen this year, the U.S. unemployment rate further declined to 3.5 percent in September, the lowest level since 1969, and fuel prices stabilized below $3.00 per gallon, despite the conflicts in the Middle East.

The bad news is that UAW-GM strike lasted almost 6 weeks, the ripple effect of 35 GM U.S. manufacturing plant shutdowns has affected local communities and economies; facilities in Canada & Mexico now affected, U.S. motor vehicle sales year-to-date declined by 1.1 percent, a “ceasefire” was reached in U.S.-China trade negotiation, but trade barriers remain, 25 percent additional tariffs on imported cars & parts remain a threat to global automakers and suppliers; through the administration’s mid-November deadline, and the global economic growth outlook remains pessimistic for 2019 and 2020.

 

Future Technologies in Manufacturing and Materials

CAR’s materials and manufacturing technology research concentrates on evolving material technologies and manufacturing systems.  Our materials research is focused on mixed-material lightweight solutions and joining methods involving metals, plastics, and polymer composites.  Our manufacturing research focuses on next-generation technologies such as additive manufacturing, innovative tooling methods, augmented reality, and internet-of-things to improve production system performance. Although the automotive industry has been at the forefront of many technological advancements, the medial and aerospace industries have led innovations in additive manufacturing (AM). CAR produced a brief feature story and white paper on AM innovations in 2019.

 

Fuel Economy & Greenhouse Gas Regulations

Vehicle manufacturers are aware they are in a rapidly changing world — one with less certainty than ever before. For vehicle manufacturers, regulatory certainty is a critical but elusive target. As they invest billions of dollars in future products, manufacturers and suppliers need to understand what will be required to meet future standards.

 

Smart Cities /Connected & Automated Technologies/ Smart Mobility

Industry stakeholders must carefully track trends and forecast upcoming changes in the rapidly evolving mobility landscape. Technological, social, regulatory, and industry dynamics are vital areas to watch closely in the coming years. New data analysis methods (specifically using AI) and sensor technologies, emerging business partnership models, automated vehicle regulations, and data privacy laws, as well as social acceptance, are a few examples of potentially transformative industry trends. Success or failure in one or more of these areas has the potential to transform the intelligent mobility industry dramatically.

 

CAR WEBINARS

In 2018, CAR began offering Affiliate webinars. CAR Affiliates have the opportunity to participate in the webinars in real-time. Once recorded, the webinars are available to the general public.

CAR 2020 RESEARCH FOCUS AREAS

These focus areas of research are dependent on our research clients, including you. We are always open to input on areas of research we should explore.

  • Advanced Driver Assistance Systems   (ADAS)
  • Automotive Cybersecurity
  • Capacity Allocation
  • Connected & Automated Vehicle Technology
  • Economic Modeling
  • Energy Infrastructure
  • Forecasting & Economics
  • Industry 4.0
  • Infrastructure Modernization
  • International Business
  • Labor Relations
  • Manufacturing
  • Materials
  • Mobility as a Service (MaaS)
  • Product & Markets
  • Propulsion
  • Public Policy & Regulations
  • Smart Cities / Urban Planning
  • Smart Mobility
  • Workforce Development

Research Opportunities 2020 and Beyond

  • Additive Manufacturing
  • Augmented Reality & Virtual Reality in CAV and Manufacturing
  • The Convergence of Technologies and Industries
  • Sustainability in the Circular Economy
  • Data Analytics and Data Monetization
  • Healthcare – wearable technology and mobility services
  • Human Behavior & Trust
  • Industry Structure
  • Regulations & Safety re: CAV
  • Regulations re: GHG, CAFE
  • Retail – Dealerships and Mobility Service Packages
  • Smart Factory
  • Supplier Relations

CAR 2020 Events

**Indicates no charge for Affiliates  *Indicates discounted registration for Affiliates

Q1

  • Affiliates Networking Dinner – CES, Las Vegas, January 8, 2020
  • UAW Webinar – Jan
  • Additive Manufacturing: Industry Briefing – January 14, 2020 (Automation Alley)*
  • Annual ACP/Affiliates Meeting: 2020 Outlook  – January (Detroit)**
  • Connected & Automated Vehicle Working Group Meeting (Detroit Metro)**
  • CALM Meeting
  • The Mobility Web: Industry Briefing – March 11, 2020 ( HPE – San Jose, CA) & Affiliates Networking Dinner, San Jose, CA March 10, 2020
  • White Paper Webinar – or Affiliate Spotlight Webinar**

Q2

  • CALM Meeting
  • Connected & Automated Vehicle Working Group Meeting (Detroit Metro)**
  • White Paper Webinar – or Affiliate Spotlight Webinar**
  • Affiliates Networking Dinner – NAIAS, Detroit, June 2020**

Q3

  • Connected & Automated Vehicle Working Group Meeting (Detroit Metro)**
  • White Paper Webinar – or Affiliate Spotlight Webinar**
  • CALM Meeting
  • Management Briefing Seminars (CAR MBS) – August 4-6 (Traverse City, MI)*
  • Annual Affiliates Dinner & Industry Briefing – September(Detroit Metro)**

Q4

  • White Paper Webinar – or Affiliate Spotlight Webinar**
  • CALM Meeting
  • Connected & Automated Vehicle Working Group Meeting (Detroit Metro)**

Ways to Engage with the CAR Community in 2020

  • Ask us to present at a company meeting or event—or—ask us to co-present at an upcoming industry event
  • Send us your research questions
  • Ask us to give a company webinar for your company
  • Pitch us an Affiliates webinar idea and/or participate in an Affiliates webinar as a speaker
  • Pitch us an Affiliates Dinner or Industry Briefing idea and/or participate as a speaker at an Affiliates Dinner or Industry Briefing
  • Host a CAR Industry Briefing
  • Submit a speaker for CAR MBS
  • Become a sponsor or exhibitor at CAR MBS
  • Join a working group
  • Host a working group meeting

CONCLUSION

The automotive industry is rapidly transforming with unprecedented advancement in technology development and processes. This evolution is occurring in a global political climate of economic, policy, and regulatory uncertainty. Industry stakeholders must carefully track trends and forecast upcoming changes in the automotive and mobility landscape. Technological, social, regulatory, and industry dynamics are vital areas to watch. Several factors can affect the industry’s progress in the coming decades.

With your support, CAR will continue to research and analyze the major issues impacting your work and success.