David is to be returned to Italy   A bit of cultural news for a welcome change! - PowerPoint PPT Presentation

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David is to be returned to Italy   A bit of cultural news for a welcome change!

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  1. The Auto Sun is RisingDavid E. ColeEmeritus ChairmanCenter for Automotive Research (CAR)Monahan Endowment LectureWayne State University,College of EngineeringMarch 23, 2011

  2. David is to be returned to Italy   A bit of cultural news for a welcome change!

  3. His Proud Sponsors were Fast Food Chains…

  4. Auto Problem Mostly Revenue – with Depression Level of Sales

  5. GM & Chrysler – Debt Reduction, Lean Ford: Good & Bad News, No Bankruptcy but High Debt All Manufacturers & Suppliers Have Been Hurt But, The Sun is Rising Fast


  6. Across the Land – Still Amazing Level of Ignorance on Auto Industry

  7. Policy Materials Money The Perfect Storm Competent New Players: China, India, … Benefits Auto Industry Hyper Competition Tools

  8. Auto Industry of the Future A World of Vanishing Boundaries

  9. Economic Contribution of the U.S. Automotive Industry

  10. Auto Manufacturing Manufacturers . . . . 313,000 + jobs Parts Suppliers . . . . 686,000 + jobs R & D Spending . . . $16 + billion Source: BLS, NSF *includes NAICS 3361, 3362

  11. Economic Contribution Per Job Auto Mfr. $329,000 Average Job $112,000 Source: U.S. Census Bureau Annual Survey Manufacturers 2005

  12. Economic Multiplier Auto Manufacturers – 10 Auto Parts Supplier – 5.7

  13. Auto Employment 2010 – modest gains 2011 – 2013 + 100,000 per Year

  14. We Have Been Swimming a River That is Getting; Faster, Deeper, & Wider But!

  15. The Pot of Gold on the Other Side is Getting Larger • Labor Cost Reduction • Household Growth • Pent-Up Demand • Capacity Reduction • Scrappage • Return of Pricing Power

  16. The Challenge: Getting to the Other Side But We Have Reached the Shallow Water

  17. Domestics – Unbelievable Shift from about $2,000 Disadvantage to $2,000 Advantage

  18. However, Will It Come Back . . ?U.S. Light Vehicle Sales Forecast +4.4 M +6.8 M +8.9 M +2.4 M -8.0 M -9.3 M -5.2 M Source: CSM Worldwide, J.D. Power PALE Meeting-March 19, 2009

  19. U.S. Light Vehicle Sales History and ForecastCombined J.D. Power and CSM Worldwide Forecast2007 - 2014 Millions Source: CSM Worldwide, JD Power, Inc. PALE Meeting-March 19, 2009

  20. The New Break-even- 10-11 Million Sales

  21. Beware: The Aging of the Boomers.

  22. Demographics “Boomers go Boom” • Consumer Behavior • Socio / Political • Health Care • Skilled Workers • World Issue

  23. Auto Industry - Thousands of New Jobs – But Only for the Educated

  24. “This is Auto” “Building America’s Tomorrow”

  25. The Business Model is Changing Fast.

  26. Old Business Model Vertical Integration Talk Paper Bureaucracy Linear Slow Lean Control Legalistic Physical Prototypes Individual Sequential Job for Life Regional Kings Competition Acquisitions Structured

  27. New Business Model Listen Virtual Integration Collaboration Paperless Anti-bureaucracy Lean Agile Fast Empowerment Trust Virtual Prototypes Team e-enabled Parallel People Flow Coaches Global Coopetition Alliances Flexible

  28. It’s the Team, the Team, the Team

  29. Global Integration- One Company World-wide • Platforms • Components • R & D • Plants • Everything

  30. Value of Global Economies of Scale are Huge

  31. Lean / Agile • Investment • Engineering • Manufacturing • Everything

  32. Knowledge The Competitive Edge

  33. Cars and Trucks Customer Pull Technology Push Product and Process

  34. Knowledge Competitive Advantage Innovation KnowledgeApplication Time

  35. Do What You Know

  36. Coming Soon:“Auto Harvest”

  37. Auto Technology At the edge of a revolution?

  38. Fun Performance Green Environment Future Cars

  39. Future Power Plants • Gasoline • Diesel • Hybrid • Fuel Cell The Answer – ?

  40. Technological Progress—When to Commercialize Too early $ A Current Technology B Time

  41. POWER TECHNOLOGY COMPARISON CHART

  42. “BOTTOM LINE” • Not enough knowledge to pick winners and losers • Different strategies for different companies • Alliances necessary to overcome challenges • Government incentives required…ultimately consumers decide

  43. Coming Fast – Plug-in, Series HybridsorExtended RangeElectric Vehicles

  44. Future Fuels • Petroleum • Bio • Hydrogen • NH3 The Answer – ?

  45. Future Gasoline Price – $ 1.50 – $ 5.00 /gallon

  46. Annual Mileage 15,000 Annual Fuel Cost MPG

  47. Old Carbon Fuels Will Continueto be Used if they are Economic

  48. Improved Efficiency and New Carbon Fuels – Can Slow Growth of Old CO2 and Keep Expensive Old Carbon Fuels From Being Extracted.

  49. 2 Key Developments • Lithium Batteries • Cellulosic Bio Fuels

  50. The Invention is Here!