Handouts - South Carolina Economic Developers

5/5/2015
The Future of the
Automotive Sector
(and how it relates to South Carolina)
SCEDA 2015 Annual Conference
Frederick M. Cartwright
Executive Director, CU-ICAR
May 8, 2015
Automotive History – 130+ years!
Cugnot’s Steam Wagon (1771)
Ford Model T (1908-1927)
Benz Patent Motorwagen (1885)
1st Prod’n Vehicle with ICE
Plymouth Savoy (1954)
German Flocken Elektrowagen (1888)
1st Electric Vehicle
Toyota Corolla (2011)
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Automotive Current – rapid change abounds!
Chevrolet Volt (2010)
Plug-in Hybrid EV
BMW i3 (2014)
EV and Range Extended EV
Nissan Leaf (2010)
Electric Vehicle
Google Driverless Car (2014)
Concept
Tesla Model S (2012)
Electric Vehicle
Toyota Mirai Fuel Cell Vehicle (2016)
But, then again…..much has remained the same
Top Sellers in the U.S.
2004
2014
#1 Ford F-150
#2 Chevrolet Silverado
#3 Toyota Camry
#1 Ford F-150
#2 Chevrolet Silverado
#3 Toyota Camry
U.S. Market Size= 16.9 million
U.S. Market Size = 16.5 million
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What has changed in the U.S. in this timeframe?
One of the worst economic recessions in history
drops to 10.4 million cars
U.S. market size
Introduction of PHEV and BEV’s to the US market
120,000 Plug-in
vehicles sold in 2014; U.S. is the largest EV market worldwide; more
that 10,000 EV charging stations deployed nationwide
Exponential growth of the use of smart phones
In 2005, less than 4
million sold; In 2014, 50 million sold (Apple 50% market share,
followed by Samsung with 26%)
Growth of renewable energy
Solar and wind power generation
Independence from foreign oil
Level of oil import is at historic low
(2014 and 1975 levels are similar)
What has changed outside the U.S. in this
timeframe?
China is now the largest automotive market in the world and produces
by far the largest number of vehicles per year worldwide
• 21.98 million new vehicles sold in China in 2014; significant environmental
challenges (emissions, road congestion)
• 23.7 million vehicles produced in China in 2014 (1 out of 4 new cars in the
world is produced in China)
The automotive market worldwide is on a steady growth path
• In 2010, first time that more than 1 billion cars were driving on the roads
worldwide
• Global car production is increasing (3% steady growth)
Asia dominates in Megacities
• The Top 5 Megacities (>20 million people) are all in Asia; rapid urbanization
in China and India
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What has changed outside the U.S. in this
timeframe (cont’d)?
Europe issued the tightest emissions regulations worldwide
• 2021 EU emissions goal of 95g/km CO2 causing heavy European OEM
investment in EV’s, despite limited home market penetration
Mexico replaced Canada as largest vehicle exporter to the US
• Mexico surpassed Japan as No. 2 automotive exporter to the US in 2014
and is expected to surpass Canada as No.1 automotive exporter in 2015
Corporate Avg. Fuel Economy (CAFÉ)
2025: 54.5 mpg (sort of)
Segment
Make & Model
2012 mpg goal
2017 mpg goal
2021 mpg goal
2025 mpg goal
Subcompact Car
Kia Soul
34.6
41.7
48.6
58.4
Midrange Sport
Car
Chevrolet
Corvette
33.4
40.0
46.6
56.0
Compact Car
Chevrolet Cruze
33.4
40.0
46.6
56.0
Midsize Car
Toyota Camry
32.3
38.4
44.8
53.8
Premium Luxury
Car
BMW 7 Series
28.0
32.7
38.0
45.6
Compact
Crossover SUV
Ford Escape
29.0
34.9
40.2
48.4
Compact Truck
Toyota Tacoma
27.2
31.8
36.6
44.1
Midsize
Traditional SUV
Ford Explorer
25.9
29.9
34.2
41.2
Minivan
Toyota Sienna
24.8
28.3
32.1
38.6
Large Truck
Ford F-150
22.3
25.1
25.3
30.2
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The automotive industry has reached an
inflection point of new technologies, new
players and new locations
New Technologies Converge
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5/5/2015
New Players: Shifting from horsepower to
computing power – smartphones on wheels?
March 27, 2015
New Locations: Other North American
locations not standing still
Proximity to Mexican parts suppliers could provide a logistical advantage
for plants located in the Auto West Corridor, if the trend toward increased
Mexican parts content continues.
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5/5/2015
Mexico: Competition south of the border
While the southeast
automotive region has done
well in terms of
investment……
Mexico is outpacing our
region with announcements
of new vehicle assembly
plants
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5/5/2015
Mexico: Rapid increase in engineering
capability.
Enterprise
FORD
Chrysler
General Motors
Volkswagen
Nissan
Delphi
Continental
Faurecia
Number of Engineers
800 1,100
500
600
600
700
1,500
700
300
6,000 engineers located in automotive and tier 1 technical
centers. (Source: Industria Nacional De Autopartes, A.C.)
How do we become more globally
competitive??
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Thank You!
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