GLG News by Mr. Mark Fendley, Continuous Improvement Manager
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For Faurecia, Other Suppliers, and OEM's, Emerging Markets are the Surest Bets
July 1, 2010
Faurecia Gets Stronger in China, Buys Stake in Key Partsmaker | europe.autonews.com
Automotive Suppliers and OEM's are expanding in market operations through added capacity and acquisitions in Mexico, China, India, and Russia. This is not only a strategy to be in emerging markets to be positioned for vehicle sale growth in those markets but also to create an export foundation and currency hedge for the long term.
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Automotive Industry Consolidation and M&A Will Occur, But what are the Targets?
June 15, 2010
Faurecia, Valeo Plan Takeovers as Car-Parts M&A Looms | www.bloomberg.com
The article in Bloomberg suggests that automotive Tier suppliers will be goig through some consolidation, merger and acquisition, but what sort of companies would be of interest and what are the strategies? What are some of the predictors that will drive the analysis, from an industry standpoint.
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Hyundai Does To the Japanese OEM's, As They Did to US OEM's -What's Next?
January 7, 2010
Hyundai Smokes the Competition | money.cnn.com
Hyundai has come upon a winning formula that includes higher quality products based upon emulation of premium products, growing global presence, an expanding customer demographic, and a culture focus of quickness and agility.But can Chinese and Indian OEM's be too far behind?
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Magna Will Find Better Targets for Their Attention and Their Cash
November 6, 2009
Magna Ends Hunt for Automaker, Eyes Suppliers | www.autonews.com
Magna may have risked alienating certain customers, especially in regards to component technology development, if they had succeeded with the Opel partial purchase.Magna is developing good partnerships in the growth segments of electronic, software, sensor, battery, and power management, so a growing interest in shopping for those suppliers that can be added to Magna's electronics or eletrical component product portfolio makes very good sense.
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June 8, 2009
Ford to Face Tougher Rivals Following U.S. Rescue | online.wsj.com
The WSJ article focuses on the immediate and medium term financial improvement that GM and Chrysler will enjoy as a result of the U.S. taxpayer bailout. But this does not necessaily translate into sales. Toyota and Ford still have the potential to take significant market share from GM and Chrysler. If you can't sell the cars to consumers, then profits are not in the cards.
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May 4, 2009
Germany's Edscha to be Sold in 2-4 Months | uk.reuters.com
While we see most of the press regarding the fate of Chrysler and GM, there are many Tier suppliers to the automotive OEM's that will be transformed in the next several months as well. How can these targets for acquisition be best recognized?
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Automotive Manufacturers Will Sell Where the Buyers Are - So Follow the Market Maturity
April 22, 2009
China Influence Grows With Car Sales | www.nytimes.com
As emerging market consumers grow their incomes, and as their countries grow their road infrastructure, the automotive companies will be there to provide vehicles. With very high populations in China, India, and Russia without vehicles, the markets are ripe for offering vehicles to those who have the income to purchase at all price points.
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Support for Automotive Suppliers Means More Than Just Incidental Support for GM, Chrysler, and Ford
March 23, 2009
Auto Suppliers TARPed, But Questions Remain | www.forbes.com
Although it may not be transparent to many Americans, automotive Tier suppliers are usually linked to multiple OEM's. The failure of some of these Tier suppliers could interrupt component supply not only to GM and Chrysler, but to Toyota, Volkswagen, Nissan, Hyundai, and others. So, it is crucial that these suppliers are supported and find appropriate financing during these very tough economic times.
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The End of Chrysler as We Have Known It
February 23, 2009
Chrysler Unlikely to Stand Alone | www.autonews.com
Chrysler has submitted a plan for a stand alone survival that is based upon the market yielding unrealistics sales, market share, and concessions from the supplier base. If Chrysler does have a partner moving forward, it makes more sense that it is Fiat, a Chinese manufacturer seeking a delaership and logistics network in the U.S. market. A GM merger makes the least sense, and most likely would mean further resource drain for GM.
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Honda's Announcement Is No Surprise - Now the Task Is To Identify the Best Positioned
February 2, 2009
Honda Lowers Profit Forecast for 4th Time | www.iht.com
Honda and most other OEM's will forecast lower sales and lower profits, if any, for 2009 and most likely 2010. The indicators of future success will be those OEM's remaining steadfast in their investment in fuel efficiency technology, hybrid technology, and globally positioned world car platforms. Not all OEM's will demonstrate this. Most likely, more brands will disappear in the next two years.
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The Downturn in the Automotive Industry Will End, and the Survivors Can Be Predicted
January 12, 2009
U.S. Drivers Keep Autos Longer, Shun Showrooms on Job-Loss Risk | www.bloomberg.com
This article regarding automotive sales is very accurate. Consumer confidence in their income and wealth growth prospects drive automotive sales. But we can predict the OEM's and Tier Suppliers and technologies that will emerge as survivors and as investment potentials. Also, historically similar downturns are followed by a surge in replacement demand for new vehicles.
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November 10, 2008
Running on Fumes: GM could soon run out of cash | www.forbes.com
Detroit's Big Three have several obstacles to overcome; the question is will they have the ability to withstand this perfect storm? Consumer confidence is shaken, financing is impossible or difficult, product mix doesn't meet market demands, alternative energy development and emission compliance is tremendously expensive, and the cutbacks and draw downs affect employee morale and leads to a loss of talent. Who, if any, will survive as a stand alone company?
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Renault's Move Is Right; Right Size the Company For Striking and Non-Striking Employees
September 16, 2008
Job Cuts at Renault Spark Strike | news.bbc.co.uk
As a result of soft sales, and soft volume projections, Renault must reach lower labor numbers through voluntary reductions. The pressures at Renault have been more intense than at other European OEM's as Carlos Ghosn applies pressure on vehicle development and launch timelines. The pressures, along with the labor reduction news, have reached a boiling point for the Renault employees.
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Carmakers Deserving of a Bailout? Taxpayers and Consumers Take Notice, it's Your Wallet
September 1, 2008
Carmakers Deserve Loan Guarantees, G.M. Official Says | www.nytimes.com
There are other mechanisms to achieve where GM, Ford, and Chrysler need to be in terms of technology and product. The loans will be little more than a taxpayer funded bailout. GM, Ford, and Chrylser have not learned from the ample lessons they have had in the past, what assurances are there that they will this time.
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Autloiv's Investment in Sensors Makes Good Sense
August 18, 2008
Autoliv to Acquire Radar Sensors Business of Tyco Electronics | www.tradingmarkets.com
Certain parts of the automotive passive and active safety original equipment market are moving towards commodity status, with volume being the key to future profitability. Tier One safety equipment suppliers must invest in those technologies that will bring greater value and margins.
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How Much Deeper and How Much More will GM and Ford Have to Cut to Right Size?
July 29, 2008
GM cuts truck shifts to meet lower output target | www.reuters.com
GM, and Ford, are the victims of too much focus on the American market, for far too long, at the expense of the world market. GM, and Ford, must continue to shift away from, and write down production and assets focused on truck and SUV production. How much will GM and Ford have to give up, to survive?
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July 21, 2008
Toyota to make Prius, not SUV, at new US Plant | www.reuters.com
Toyota's announcement that the new Mississippi facility will produce the Prius is a smaret decision to increase capacity for a marketable product, with variant potential for the future. Toyota's temporary suspension of production in Indiana and Texas to reconfigure the plants for greater product flexibility is a model already proven to be a smart capital investment strategy by Nissan and BMW. Toyota is also indicating with this article a philosophy for world cars, as demonstrated by Prius production for other markets.
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June 30, 2008
AUTO-PARTS FIRMS FACE TROUBLE AS CAR MAKERS RETOOL PRODUCTION | www.aemag.com
With the downturn in US sales volumes and a rapid switch from SUV and light truck to smaller, more fuel efficient cars the Big Three are taking some of the Tier One suppliers down with them. Those that are diversifed in terms of product, geography, and model mix are the most well positioned to ride out the storm. Johnson Controls is one of those companies positioned well to maintain and to grow in the current, difficult market.
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Ibiquity Has Significant Potential That Will Be Realized Through HD Radio
June 9, 2008
Pumping Up the Volume: HD Radio Touts Price Cuts | www.investors.com
The new price point for HD receivers will mean signicantly more volume of units in automotive OEM applications, potentially surpassing one million units installed in OEM applications by early 2009. Unlike Sirius and XM, Ibiqiuty's HD radio is finding an audience in Asia and in Europe. Ibiquity is entering into unique partnerships with Apple and Navteq, that will enhance the functionality of HD radio.
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Volkswagen Announcement in July Will Be a Bright Spot in an Otherwise Gloomy Automotive Mont
June 9, 2008
Decision on VW plant still on track for July announcement | www.chicagotribune.com
Volkswagen recognizes they have to produce in the US to growth the US market share. The same formula has worked for the other German, Japanese, and Korean transplants. Expect the factory to be flexible enough to produce both Volkswagen and Audi products, since they share platform and powertrain components. Also, expect the factory to be positioned as an export center for VW and Audi products produced with US components with a US dollar basis.
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