Southern Automotive Alliance October-November 2018

OCTOBER/NOVEMBER 2018

CU-ICAR’S DEEP ORANGE Designing the future in automotive

Industry Outlook: What do trade and fuel emissions changes mean for carmakers?

Executive Q&A Volvo’s Jeff Moore on moving into South Carolina

Hopkins Advantage Providing multiple services to make industry more productive

The Ray Paving the road to smarter transportation

SIGN UP NOW FOR A FREE PRINT SUBSCRIPTION AT SOUTHERNAUTOMOTIVEALLIANCE.COM OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 1

4 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 5

6 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 7

oct.nov

Supplier Profiles

2018

52 ResourceMFG

In 30 states it’s a go-to name for training workers

volume 3 number 5

54 Shoals Extrusion

This small Florence, Alabama company is making a big name in several industries, including automotive

56 Hopkins Advantage

From a base in Mississippi, this womanowned one-stop shop is reaching clients all over the South

Faces of the Industry 48 Ashley Frye

The head of TAMA brings knowledge from the military and industry to support Tennessee’s car makers

Departments 10 From the Editor 12 Benchmarks/NewsHub 60 Regional Reports 66 Kudos 69 Career Notes 70 Industry Indicators/Stocks 72 By the Numbers 74 Index 76 Vintage

36 Features 20 EXECUTIVE Q&A

Volvo’s Vice President of Production talks about moving the luxury brand to South Carolina

36 WORKFORCE DEVELOPMENT

A Texas professor has a proven strategy for building work-ready auto engineers and it involves building race cars

24 INDUSTRY OUTLOOK

In this double feature, we ask what proposed changes in U.S. trade policy and emissions standards mean for the automotive industry in the near term

32 VISION

The Ray, inspired by a businessman’s determination, this nonprofit is charting a path to smarter highways

41 SPOTLIGHT

CU-ICAR Dedicated students work with industry and a powerfully creative Clemson program to envision the future of automotive

58 INDUSTRY NEWS

Autonomous cars are coming, and that’s what worries some safety advocates

41

ON THE COVER: CU-ICAR’s Nick Rigas recently became executive director of the Clemson program pushing the boundries in automotive education.

8 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 9

From the Editor

A

utomotive is all about nuts and bolts and engines and drivetrains, but it’s also about imagination.

Not just daydreaming, of course. Think about it: before the car moves off the assembly line, it’s a flicker in the imagination of an engineer - or a team of them somewhere. Before manufacturers can make the cars of the future, someone with vision has to boldly look beyond the what-is, to the what-might-be.

If you’re getting this magazine at the Southern Automotive Conference in Atlanta, you’re surrounded by people who have been imagining what the automotive future will look like. What is really going to be the next big thing? Is it electric? Is it autonomous? Is it car-sharing? Ride-sharing? More cars? Fewer? All of the above? Or something no one has thought up yet?

SAC is a great forum for ideas. From government to education, OEMs to suppliers, innovators to old school stalwarts, this year’s conference promises to give a look into the future and promote the ongoing conversation about the shape of things to come

in automotive.

And this issue of Southern Automotive Alliance magazine keeps that conversation about the future going.

For instance, think of the imagination it takes to conceive of a world where transportation is clean, with highways that support the ecosystem and driver safety. You can learn how that’s becoming a reality in Georgia thanks to the Ray, an innovative idea which is a highway, a foundation and a movement all at the same time. SAC speaker Allie Kelly speaks about their ideas more fully in our story.

Or think about this: where will the cars of the future come from? How about a vast educational laboratory working with industry at Clemson University’s CUICAR and their pretty amazing Deep Orange program? There’s a lot to feast your eyes on in our Spotlight feature this issue.

Can you predict what the future holds for the automotive industry as a whole, in the face of Trump administration changes to international trade and fuel economy standards? We talked to a few experts this issue who will give you their best educated guesses about where things are heading.

And if you want to imagine what the near future looks like in South Carolina’s ever-expanding automotive landscape, one place to look is the Volvo plant, which is just getting up to speed. We have a nice interview with their vice president of Manufacturing, Jeff Moore, in this issue.

One more thing: this year’s SAC has been the product of a lot of imagination – and seriously hard work by GAMA’s Rick Walker and my dedicated colleagues at PMT Media and Events, Sheila Wardy and Molly Lipski Powell. Frankly, seeing how much it took to bring this massive event to fruition made me wonder what it was like in that first SAC all those years ago.

Who, in the depths of a recession, could have imagined bringing automotive manufacturers together? See Vintage at the end of this issue for the answer.

And enjoy SAC 2018 if you’re here. You’re swimming in big ideas and purposeful imagination.

Nicholas Patterson, Editor Southern Automotive Alliance

By the way, if you’re getting this magazine, why not subscribe? It’s easy and just as free as the magazine itself. Just visit our website, www.southernautomotivealliance.com and click on one of the easy subscription buttons or popups. Drop me a line and let me know how well that worked – or tell me what you think about the magazine and what we ought to be writing about, at npatterson@ pmtpublishing.com.

To subscribe at no cost and receive future issues via mail, visit southernautomotivealliance.com 10 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

PUBLISHER: Walker Sorrell EDITOR: Nicholas Patterson npatterson@pmtpublishing.com ART DIRECTOR: Rebecca Reeves DESIGN EDITOR: Cathy Still McGowin WEB PRODUCER: Abby Parrott COPY EDITOR : Christine Gordon CONTRIBUTORS Dave Helms, Cara D. Clark, Bill Gerdes, Gail Allyn Short, Henri Hollis, Linda H. Lamb, Carla Caldwell, Michelle Love, Lawrence Elizabeth Knox, Dennis Keim, Amile Wilson, Myron Levin, Megan Boyle ADMINISTRATION: Molly Lipski Powell CIRCULATION: Anita Miller ACCOUNTING: Keith Crabtree ADVERTISING SALES: Chandler Busby 205-802-6363 Ext. 103 cbusby@pmtpublishing.com DIRECTOR OF AUDIENCE DEVELOPMENT Mark Singletary msingletary@pmtpublishing.com INTEGRATED MEDIA & EVENTS Sheila Wardy swardy@pmtpublishing.com 2204 Lakeshore Drive, Suite 120 Birmingham, AL 35209 (205) 802-6363 southernautomotivealliance.com T.J. Potts, President PMT Publishing, Inc. 3729 Cottage Hill Rd H • Mobile, AL 36609 pmtpublishing.com • 251.473.6269 Southern Automotive Alliance is published bimonthly by PMT Publishing Inc. Copyright 2018 by PMT Publishing Inc. All rights reserved.

Reproduction in whole or in part without written permission prohibited.

Address all correspondence to Southern Automotive Alliance, 3729 Cottage Hill Road, Suite H, Mobile, AL 36609 or 2204 Lakeshore Drive, Suite 120, Birmingham, AL 35209. Phone (251) 473-6269 in Mobile or (205) 802-6363 in Birmingham. FAX in Birmingham is (205) 8026393 and e-mail address is info@pmtpublishing. com. Letters to the editor are welcome or e-mail to npatterson@pmtpublishing.com. Please query the editor before sending unsolicited articles or photographs.

Moving? Please note US Postal Service will not forward magazines mailed through their Bulk Mail unit. Please send old label along with your new address 4-6 weeks prior to moving.

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 11

TEXT BY: DAVE HELMS

Industry Benchmarks

N

Nissan Invests $170 Million In Two Plants For All-New 2019 Altima

issan in August celebrated the sixth generation of its popular Altima sedan, announcing a $170 million investment to its Canton, Mississippi and Smyrna, Tennessee assembly plants to the produce the 2019 model.

Production of the 2019 Altima began Aug. 23 in Smyrna, Tennessee. That plant has produced nearly 4.6 million Altimas since the first one rolled off the line in June 1992.

With the newly announced investment, Nissan has now committed nearly $12 billion across all of its U.S. manufacturing footprint.

“Nissan’s continued investment in our manufacturing facilities underpins our commitment to building top-quality vehicles in the U.S., as well as our valued workforce and the communities where we do business,” says Heath Holtz, senior vice president, Manufacturing, Supply Chain Management and Purchasing,

N E W S

H U B

A NEW DOOR FOR TENNESSEE France-based supplier Faurecia Interior Systems said in August it will invest $30 million to build a 145,000 square-foot facility to make door panel assemblies in Spring Hill, Tennessee. It will create more than 140 jobs, officials said. Faurecia is a global supplier of automotive seating, interior systems and emissions systems.

KENTUCKY RAISES THE ROOF Webasto Roof Systems Inc. of Lexington, Kentucky recently announced it would add a new production line worth a $15.2 million investment, creating 183 jobs. Over a two-year period the company will add a new production line at one of its two facilities in the Blue Grass Business Park, where it started operations in 1998.

12 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

Nissan North America, Inc. Nissan’s $170 million was primarily used to upgrade Smyrna Vehicle Assembly Plant and Canton Vehicle Assembly Plant with the latest manufacturing technology. The work included a body shop brazing system that provides the flexibility to weld the vehicles’ sleek trunk lid, while the paint shop got a new polyurethane stone guard coat paint system that provides a more durable exterior appearance.

Nissan also added calibration equipment that helps ensure the reliability and functionality of ProPILOT Assist technology.

ProPILOT features rear automatic braking, enhanced driving performance and available Intelligent All-Wheel Drive.

The all-new Altima arrives on dealer lots in the U.S. this fall and will be produced at Nissan Smyrna and Nissan Canton assembly plants. n

JAGUAR COMES TO GEORGIA Jaguar Land Rover Classic plans to build an operations center in Savannah, Georgia that will employ 75 people with salaries starting at $80,000, according to the Savannah Economic Development Authority. It will be the England-based company’s first facility in the U.S., providing access to Jaguar and Land Rover Classic cars, services and parts.

A 42-bay workshop will keep all those vehicles in top form.

NAFTA TAKES NEW SHAPE U.S. President Donald Trump and Mexican President Enrique Peña Nieto rolled out a new U.S.-Mexico trade deal in August, seen as the first step toward a renegotiated North American Free Trade Agreement. Foreignbrand automakers had signaled an unwillingness to raise the amount of local content in North American-made vehicles. Canada appeared more willing, afterward, to reopen NAFTA talks.

SMW Expanding In Mississippi With $4 Million Investment

VW Stumbles From Dieselgate To Hail Cannon Controversy

S

MW Manufacturing announced in August that it’s planning a $4 million investment in north Mississippi to strengthen and expand its facility in Oxford, creating 25 jobs.

The company, a global supplier of cold-formed components, manufactures components for the heavy truck, automotive, mining, construction and industrial markets. The expansion will help support the company’s new business in Mississippi, according to the Mississippi Development Authority.

SMW moved into Lafayette County in 2017, taking over a former Caterpillar facility. The expansion will relocate equipment from Minnesota to Mississippi.

“SMW Manufacturing’s presence in Oxford, Mississippi just reached its first anniversary at the beginning of July. To say that we are pleasantly surprised by the successes we’ve achieved in this first year would be quite the understatement,” SMW General Manager & Vice President of Operations Rich DesCoteaux told Area Development magazine.

“The team chosen to manage and operate the Mississippi location are all locally grown talent; SMW did not transplant a single employee. Because of the get-it-done attitude and ability to learn new concepts, the plans to populate new business into Oxford have been accelerated.

We greatly appreciate the support provided by the state of Mississippi, Lafayette County and the city of Oxford.”

Once the expansion is complete, through the next four years, SMW will employ 75 people in Oxford.

“The productive workforce in North Mississippi was instrumental in SMW’s decision to expand its operations in Lafayette County. We are committed to ensuring companies such as SMW have access to a talented labor pool so they may enjoy years of growth and success in our great state,” Governor Phil Bryant said. n

CAREER TECH Southwest Tennessee Community College and Tennessee College of Applied Technology at Memphis recently announced a partnership to make advanced training in automotive technology more accessible and affordable. The plan allows TCAT-Memphis automotive technology graduates to transfer up to 28 TCAT-Memphis credits to Southwest, toward an Associate

I

of Applied Science in automotive technology degree in as little as two semesters.

FINALLY, FLYING CARS If you want flying cars, which many of us have since “The Jetsons,” maybe get some aerospace companies involved.

Japan did that recently, enlisting Uber Technologies Inc. and Boeing Co. in a government-led effort that includes Airbus SE, NEC Corp. and a Toyota-backed

n the South, where folks hold close to their hearts a solid truck and the critical accessories to maximize work and tailgating, you have to wonder how long it will be before we see hail cannons mounted on the back of an F-350 Super Duty.

Hail cannons, it turns out, are the latest high tech offerings for automotive plants wary of having their brand new, sparkling products being damaged by sudden meteorological disturbances.

The cone-shaped mechanisms fire a charge of acetylene gas and air to generate a Mach 1 shockwave into the clouds where hailstorms are being formed. While only effective in a 300-to-600-foot area directly over the device, the shockwaves turn the potentially damaging hailstones into rain or slush.

Best of all, the machines fire themselves when their computerized sensors detect incoming hail. What’s not to like?

Sadly for Volkswagen, which installed the devices around their Puebla, Mexico plant, there is a downside, according to a recent report in Jalopnik. Farmers in the area believe the cannons have caused drought in a 5,000-acre area and are suing the German automaker for $3.71 million.

VW has switched off the automatic firing mode and is experimenting with lower-tech ways of protecting cars, such as mesh. Compensation hasn’t been ruled out, though Jalopnik notes some farmers use to cannons in efforts to protect their crops. Nissan reportedly made locals unhappy with hail cannons as early as 2005.

Meanwhile, football fans should be considering how hail cannons might be converted for parking lot use at football games, to hurl confetti or snacks at neighboring tailgaters. n

startup called Cartivator.

TENNESSEE COLLEGES BOOST ANALYST UNDERLINES AUTO STRENGTH The auto industry is seeing good performance in 2018, exceeding the expectations of many experts who had glum predictions at the end of 2017, according to Michael Guckes, chief economist for Gardner Business Intelligence, a division of Gardner Business Media. Guckes

credited the strength of the industry to strong employment levels and wage gains.

TOYOTA SPENDS ON UBER Toyota announced recently that it would invest $500 million in Uber and work with the ridesharing app to increase the pace of development and deployment on self-driving vehicles. Uber has chosen the Toyota Sienna minivan for autonomous tech testing, with a 2021 rollout.

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 13

BE N C HM A R K S

Arriving in November: BMW’s Fast, Muscular X5

T

he SUV crowd is mostly known for racing to the store but BMW’s 2019 X5 model could make even that exciting, with a six-cylinder xDrive40i that reportedly does 0-60 in 5.3 seconds. If that’s a little too pokey for you, the V8 version can do it in 4.6 seconds. The V8 has a top speed of 155 mph.

“The BMW X5 embodies the origins of the BMW X family and, in its fourth generation, sends out its most powerful message yet in terms of presence and modernity,” BMW Group Design senior vice president Adrian van Hooydonk said in a statement. “It defines a new X design language— robust, clear and precise.”

For tech lovers, the X5 has a generously sized infotainment system with two 12.3-inch high definition digital displays, a backup assistant that takes over when the vehicles goes into reverse and other active driver assistant systems.

BMW Plant Spartanburg in South Carolina made final preparations to begin production of the new beast throughout the summer. The mid-size luxury SUV, when it goes into dealerships in November, will go head-to-head with the Mercedes-Benz GLE and Lexus RX. This is the fourth generation for the X5, introduced nearly 20 years ago. It has sold more than 2.2 million units worldwide in the first three iterations. In the U.S., the X5 has ranked in the top three best-selling BMW models every year since 2001. The success has necessitated several expansions of BMW Plant Spartanburg – now the largest BMW plant in the world.

BMW’s manufacturing plant in South Carolina is the single largest exporter of automobiles by value in the United States.

Since the introduction of the original BMW X5, two of every three vehicles produced were exported for sale to customers outside the US. When considering the Spartanburg-built X3, X4, X5, and X6 together, more than 70 percent of the annual production is shipped to export markets. n

Survey: Millennials Have Clearer Heads When It Comes To Using Cannabis When Driving

A

utomotive safety experts will cast their eyes in October on British Columbia, Canada’s westernmost province, when legalized cannabis becomes the law of the land.

Clearly, there’s some educating to be done. A national study

by Innovative Research for the British Columbia Automobile Association showed 20 percent of 18-34 year old Canadian drivers think they drive the same or even better when high. The results are troublesome, according to Shawn Pettipas, BCAA’s director of community engagement.

The same age group says:

N E W S

H U B

PUSHING PAST PYGMY FISH Construction once again is underway at the site of the Mazda Toyota Manufacturing USA site in west Huntsville, where the two automakers are partnering to build a $1.6 billion plant. Work halted for several weeks when environmental groups protested in court that the plant threatened the habitat of the 1-inch-long spring pygmy sunfish. Both sides are working to resolve the problem.

FLEX-N-GATE GROWS IN TEXAS Illinois-based automotive supplier Flex-N-Gate is spending $175 million to expand an industrial building in Grand Prairie, Texas to support General Motors’ Arlington vehicle assembly plant, supplying bumper assemblies.

The company will also move its Texas division corporate offices to Grand Prairie from Arlington. It plans to employ 800 people there by 2020.

14 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

• 91% make plans for a safe ride home before a night out • 88% would never consider driving impaired • 78% saying they would “call out” friends considering driving

impaired • 72% have been designated drivers over the last three years, with 55% doing it regularly “Millennials have a special place in history,” says Pettipas.

“This generation grew up surrounded by impaired driving messages on TV, radio and in school. They’re the first generation who got behind the wheel appreciating the risk.” n

A PEEK AT NEW BENZ E-SUV Mercedes-Benz gave Twitter users a peek a few weeks before the Sept. 4 global reveal of its EQ electric brand, an SUV to be built in Tuscaloosa, Alabama.

The image showed the EQC’s front end.

ORACLE PICKS ATLAS Atlas RFID of Birmingham, Alabama will be one of six firms chosen for Oracle Construction and Engineering’s Innovation

Lab in Deerfield, Ill. The lab specializes in being a digital innovation site for autonomous vehicles and artificial intelligence.

HE ROCKED THE SOUTH He was a California native, but Lynyrd Skynyrd guitarist Ed King gave the Southern rock group its iconic sound, as well as cowriting “Sweet Home Alabama,” which has been heard booming out of more than a few T-tops

Alabama’s Top Toyota Exec Sounds Off On Tariffs

T

Sienna Falls Short In ThreeWay Minivan Safety Check

W

hen it comes to safety, minivan owners toting a precious cargo of children and grandparents are always particularly interested in driving the safest models. Consumers now have to consider that it’s not only crash tests they should be worried about, it’s also the software packed in the van that helps it avoid crashes in the first place.

An August evaluation of three popular family minivans by the Insurance Institute for Highway Safety gave Top Safety Pick designations to the 2018 versions of the Chrysler Pacifica and Honda Odyssey, while finding the Toyota Sienna just short of that rating.

Honda’s Odyssey earned Good ratings in every crash test, as well as Superior ratings for its crash-avoidance systems and a Good+ for child seat connectors. The Pacifica didn’t rank as well in a passenger-side small overlap front crash test but scored Superior in crash-avoidance tech. Its child seat anchors got a Marginal rating, deemed to be too likely to disappear in the seat.

Toyota, generally an industry leader in safety, got inspection dings for the afore-mentioned passenger-side small overlap crash test, scoring a Marginal rating. Still, it got a Superior rating for crash avoidance. n

and convertibles in these parts.

King, who joined the band in 1972, died Aug. 22 in Nashville at the age of 68. No cause of death was released.

TOYOTA SEEKS AI EDGE Denso and Aisin Seiki, along with two other Toyota Motor Group members, are focusing on improved R&D for selfdriving vehicles, according to Nikkei reporting. The group hopes to improve the judgment

of artificial intelligence when it comes to vehicle acceleration, braking and steering.

HYUNDAI GOES TRIANGULAR Hyundai makes a living as a maker of sensible, reliable and affordable vehicles. But reviewers this past summer showed amazement at the company’s latest offerings, particularly the 2019 Elantra.

According to Roadshow, the Elantra is a “wild departure”

oyota Motor Manufacturing Alabama President David Fernandes in July wrote an opinion piece underlining the economic contributions of Toyota and warning that auto tariffs would harm the state.

The numbers, as presented

by Fernandes, are staggering.

Toyota and partner Mazda Motor Corp. should start construction this fall in Huntsville on a new vehicle assembly plant that represents $1.6 billion and over 4,000 jobs. The Huntsville plant that’s been churning out engines for years has seen four expansions since 2003 and, with the latest $106 million upgrade to build nextgeneration engines, now boasts a total plant investment of $1 billion.

Fernandes wrote that Toyota, which operates 10 plants in the United States, would see increases to the cost of every vehicle it makes. Beyond that, every vehicle sold in the country would cost more, not just those made by Toyota, should 25 percent tariffs be imposed.

President Donald Trump’s timetable to impose automotive tariffs was pushed back over the summer when NAFTA talks slowed down and trade discussions with European automakers appeared to pick up. Some industry observers theorized that progress was being made in behind-the-scenes negotiations.

“Erecting trade barriers, like import tariffs, will ultimately invite retaliation from other nations and undermine America’s leadership, exports and competitiveness overseas,” Fernandes wrote. “We urge Congress, including Alabama Senators Richard Shelby and Doug Jones, to bring some common sense to this issue and apply the brakes to auto tariffs.” n

from the demure 2018 version, with a front end that sports triangular strength and a heavily sculpted lower fascia.

MOTION INDUSTRIES’ CEO DIES Tim Breen, Motion Industries Inc. president and CEO, died in August at the age of 58.

Breen began working with Berry Bearing Co. in 1982 as a sales representative. He served as branch manager, regional manager and corporate

accounts manager. Motion and Berry joined forces in 1993.

CHINA GETS TESTY Customs officials in Shanghai, China recently put a hold on SUVs built in Tuscaloosa, claiming that the vehicles had brake issues that posed a “safety risk.” Daimler said that the incident, involving MercedesBenz GLE and GLS models built between May 4 and June 12, was “an entirely technical issue.”

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 15

BE N C HM A R K S

Lexus ES350 Production Commences In Kentucky Toyota Motor Manufacturing, Kentucky, Inc. in Georgetown, Kentuckyc.

East Texas Advanced Manufacturing Academy Opens

R T

oyota Motor’s longest established U.S. assembly site, in Georgetown, Kentucky, began production in August of the redesigned 2019 Lexus ES350 sedan. Toyota officials have described the new model as having a more rigid, responsive chassis with superior handling and power.

Susan Elkington, president of Toyota Motor Manufacturing, Kentucky, says the Lexus Global Architecture platform devised the new model, which is longer, wider, lower and has wheels pushed closer to the vehicle’s corners.

Toyota took great effort in preparing Lexus team members to build the new model. Workers spent more than 150,000 hours training to build the ES model, time that included sensory training that teaches assemblers, for instance, to feel for an abnormality as minute as a thread of hair.

“After extensive sensory training, our team members rely on sight, sound and touch to know that the craftsmanship of the car is of the highest standard,” says Mike Bridge, Lexus assistant general manager. “A machine can’t make those judgments, and that’s why we take so much time to train before a new model goes into production.”

Bridge said an example of this sensory training can be seen in body weld where workers are taught to feel gap differences measured in fractions as small as 0.3mm.

“This is equal to the thickness of three sheets of paper and can be felt even with gloves on,” he says. n

N E W S

H U B

A TESLA PICKUP? Tesla owners tend to be trendy and urban, and so far the company has produced only three types of vehicles, but it’s said to be working on many more, including a Tesla pickup.

That’s a profitable segment for most automakers, with Ford Motor Co. pulling the most profitable weight, and so far no one seems worries about a Tesla disruption in that market.

SPEAKING OF TRUCKS Ford Motor Co. wants to build a pickup smaller than the Ford Ranger, based on the next-generation Focus platform, to sell in the U.S. by 2022, according to Automobile magazine. In many parts of the world, smaller pickups are preferred for reasons of economy.

16 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

ising, appropriately, from the site of a former car dealership, the East Texas Advanced Manufacturing Academy was set to open in late August in Longview with 35 incoming juniors from the city’s independent school districts.

Longview, just across the state line from Shreveport, Louisiana, has opened the school with plans to offer machinist courses, instrumentation, electrical coursework and other studies to train students for jobs available at area manufacturers. It reflects a nationwide effort to fill manufacturing jobs being vacated by workers going into retirement—good-paying jobs that don’t necessarily require a college education.

The academy was set up with the help of the Longview Economic Development Corp., which put more than $1 million into the project and sees it as a valuable tool to recruit companies to the area. Its first teacher will be Steve Henderson, a former machinist instructor at Texas State Technical College. Jody Sanders is the school’s inaugural director. Officials are hoping for 40 students for the first semester, though there is room for 80.

“It’s something here that’s been needed,” Sanders told the Longview News-Journal. n

DEALERSHIP TO PAY $114,074 FINE The Carl Cannon Inc. auto dealership in Jasper, Alabama will have to pay a $114,074 fine to the Occupational Safety and Health Administration to resolve citations and penalties related to a fire at the facility that killed three people and injured five.

The fire occurred as employees used a flammable brake wash to scrub the service pit floor.

LASERS AS STANDARD EQUIPMENT Even the most peaceful among us has, at times, wanted to fire a laser at the guy doing 50 mph in the interstate fast lane. While it’s only being talked about right now for the battlefield, the U.S. Army is working with Alabamabased Dynetics on a 100-kilowatt high energy laser that would ride atop a vehicle and be capable of swatting missiles and drones. It’s called the HEL TVD.

Alabama Hosts Inaugural Supplier Diversity Conference

T

he Alabama Automotive Manufacturers Association and J.F. Drake State Community & Technical College brought together top automotive and aerospace industry experts July 12 to examine supplier diversity in both those industries.

The event, held at the Von Braun Center in Huntsville, Alabama, allowed under-represented minority/womenowned companies to connect during Speed Dating sessions with the likes of Toyota and Blue Origin.

“If you’re an OEM like Toyota or Mercedes and they’re here today, you can connect with a minority business or small business that can help your business that you didn’t know was out there. Bring them, integrate them into your business to provide a service that you may want to outsource,” AAMA President Ron Davis told RocketCityNow.com.

Automotive and aerospace industry experts believe diversity is critical in remaining successful.

T

Germany’s Automotive Association Chief Issues Stout Anti-Tariff Message

he U.S. auto industry has enjoyed almost a decade of sales growth and growing employment in previously deprived regions with the help of German automakers, a U.S. Department of Commerce panel was told in July.

Bringing the message was Bernhard Mattes, president of the German Association of the Automotive Industry, speaking July 19 at a public hearing on national security concerns of automotive imports. Mattes headed Ford Motor Co.’s German operations for many years.

“At Ford I learned about the responsibility that we share about the deep and longstanding ties that bind the automobile industry on both sides of the Atlantic,” Mattes said. “Instead of harming the United States’ national security, the German

WATCH WHAT YOU PRAY FOR Republicans for years have bemoaned Obama-era gas mileage requirements, and now the Trump administration has moved to suspend gas-mileage rules after the 2020 model year.

The problem: Automakers have been spending time and money preparing to meet the standards and consumers like the idea of cars that use less fossil fuel.

“These major companies are going to be looking for solid and experienced suppliers to help them along the way; we thought that this would be the perfect time to begin to make those relations with those top companies,” says Drake State Interim President Chris Lewis. n

GOODBYE, IRAN German automaker Daimler has abandoned plans to expand its business in Iran, due to renewed U.S. sanctions placed on that nation by the Trump administration. “We have ceased our already restricted activities in Iran in accordance with the applicable sanctions,” Daimler said in a statement.

automotive industry has proven to be an integral and vital part of the US economy.”

Germany’s automakers operate 300 plants in the U.S., he noted, producing more than 800,000 “Made in the USA” cars a year and generating over 100,000 high quality jobs in production alone.

Already, German automakers have invested $30 billion in U.S. plants and recent announcements have added $5 billion in the next four years. Communities like Spartanburg, South Carolina, Tuscaloosa, Alabama and Chattanooga, Tennessee have seen new investments and new jobs.

“Companies in our industry are so deeply intertwined that our fate is a common fate. Additional tariffs will cut deeply into the tightly knit net between our companies. They would threaten our ability to export successfully out of the U.S. and call future investment into question.” n

TRUCK TRAINS COMING A new study suggests platooning, an emerging technology that digitally ties convoys of several 18-wheelers together, may be gaining ground. The advantage of platooning is that it saves fuel by reducing drag. While some states have already passed regulations to block the practice, the Competitive Enterprise Institute says 10 states have approved truck travel with as little as 40 feet between vehicles, providing

they have automatic emergency braking and radio links.

BMW HIKES PRICES IN CHINA BMW plans to raise the price of two sport utility vehicles it sells in China, the world’s biggest car market, due to current trade tensions. It increased the prices of its X5 and X6 by four percent and seven percent, respectively.

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 17

B E N C HM A R K S

Elantra Gets Triangles, New Tech For 2019

H

yundai has always been a safe and sensible car choice, but the 2019 Elantra offers a new measure of design intensity to the equation with a sleek, triangulated update to the front end.

Automotive websites began their reviews of the new Elantra marveling over the bold new look, with Roadshow going so far as to call it “experimental.”

“The 2019 Elantra is, frankly, a wild departure from the more demure 2018 model. The front end is a menagerie of triangles, from the headlights to the heavily sculpted lower fascia. At the absolute minimum, it will help differentiate the Elantra from the rest of the compact-sedan crowd,” Roadshow says.

Hyundai Motor Co. officials are more inclined to point out Hyundai SmartSense safety and convenience technologies.

SmartSense technologies available as options on the 2019

Elantra include: Forward Collision-Avoidance Assist, Lane Keep Assist, Driver Attention Assist and Safe Exit Assist.

The Traffic Safety Administration says that 94 percent of serious vehicle crashes involve human error, which is why advanced safety technologies like Lane Keep Assist have the potential to save lives.

Now in its sixth generation, the Elantra has sold more than 3 million units since its launch in the U.S. in 1991. Elantra has received numerous accolades including the most recent IIHS Top Safety Pick Plus for model year 2018.

“Refinements to both the interior and exterior were initiated on the 2019 Elantra to maintain its emotional design character and include affordable and desired features,” says Scott Margason, director, product planning, Hyundai. “The hood, front fenders, fascia, grille and headlights as well as the rear fascia, trunk and taillights each have been redesigned to convey a catchy and confident image. On the rear of the vehicle, the license plate has been relocated to the lower fascia to further enhance the new body sculpture.”

The Elantra SE packs a 5-inch color infotainment system, but higher trim levels boast Hyundai’s latest system, AVN 5.0, updated with a faster processor and an 8-inch screen. The system includes Apple CarPlay, Android Auto and a host of embedded naviation, traffic info and incident data.

The newly designed 2019 Elantra, built in Hyundai’s Montgomery, Alabama plant and its Ulsan, South Korea facility, will be available later this fall. n

Car Analyst Praises Steady, Sure Hand Of Nissan

A

utomotive analyst Janet Lewis says the careful, steady progress Nissan Motor Co. has made toward electric drives and fully autonomous vehicles will help it weather 2018’s tariff and sales storm.

Lewis, who spoke in August to WMOT’s Mike Osborne, noted that Nissan saw a 14 percent drop in profits from the last quarter, attributed in part to lower sales incentives.

N E W S

H U B

FINE-TUNING TALLADEGA Not even racetracks can rest on their laurels in the automotive world. Talladega Superspeedway plans a $50 million upgrade called “Transformation” that will make it more Millennialfriendly, with improved amenities, covered seating, giant video screens and more opportunities to rub shoulders with drivers and those behind the scenes. The track is owned

by International Speedway Corp.

DAIMLER DIVIDING Daimler AG, parent company of Mercedes-Benz, will reinvent itself with a plan called, in caps lock fashion, PROJECT FUTURE. It calls for splitting up the company into three divisions for trucks, vans and cars, and a mobility division to focus on next-generation automotive developments.

18 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

Nissan may eventually see some advantages from sticking with sedans and meanwhile, the all-electric Nissan Leaf built in Smyrna remains the best-selling electric vehicle on the road.

Lewis, managing director for Tokyo-based Macquarie Capital Securities, seemed to favor Nissan’s move to increase production of highly profitable light trucks and SUVs to meet customer demand in the U.S. n

NISSAN WEATHERS PROFIT DROP Nissan Motor Co. saw a 29 percent drop in first-quarter profits, driven by sluggish sales and the reduction of discounts. Japan’s secondbiggest automaker reported operating profit for April-June at $986 million.

UPSTART HAS APEAL Move over, Porsche, MercedesBenz and BMW. Genesis, the newcomer from Korea, has taken the top spot in the 2018 J.D. Power APEAL study, which judges consumer enthusiasm for Automotive Performance, Execution and Layout. While Genesis came out on top, the car industry as a whole achieved record satisfaction levels in the study.

Apple’s Talking, Self-Driving Car Will Soothe Your Nerves

L

eave it to Apple, a company that made its fortune in part by offering user-friendly devices, to address a major problem when it comes to self-driving cars—that being the nervous human being inside.

Apple product development is famously secretive but CNBC’s Todd Haselton reports that Patently Apple recently uncovered a new Apple patent for a car that tells passengers about the driving maneuvers it’s about to make.

Apple seems to theorize that cutting down on the surprise factor will put passengers at ease.

The system mimics what Google Maps and Apple Maps already do, providing a route ahead and the moves needed to make them. According to the patent, the Apple Car would keep passengers informed on the amount of time before the next maneuver.

A New York Times report last year indicated that Apple might be pulling back on its autonomous driving tech, but its “Project Titan” now seems to be bolstered by thousands of Apple employees. The CNBC report suggested Apple has recently hired engineers from Waymo and Tesla.

The report comes amid indications that consumers are getting more nervous about autonomous driving as the technology edges closer to reality. n

RECRUITING WITH SNAPCHAT The Alabama Community College System recently instituted programs designed to put together people looking for a job and companies looking to hire. One example of the new effort is Mercedes-Benz using Snapchat to fill an expected 4,500 job openings over the next 24 months in Alabama.

Superior Paving Adopts Smartdrive Fleet Safety Program

S

uperior Paving, one of the largest asphalt pavers in the South, has selected the SmartDrive Transportation Intelligence Program to increase the company’s safety culture throughout its entire fleet.

SmartDrive, equipped with SR4 hardware as its video-based safety program, will allow Superior Paving to continually assess its safety performance as the company evolves, and measure its performance against peers.

“It’s not often that you see a product that can solve many problems while also creating a safer culture,” says Todd Atkins, safety director, Superior Paving.

“From the size of the camera, extended recording capability and superior customer service, to the platform’s ability to capture more data from SmartDrive 360, insightful analytics and intuitive dashboard, there was no question that SmartDrive was the right program for us.”

The system has cameras to specifically record sideswipes, which are typically a difficult situation from a liability standpoint. SmartDrive transforms massive volumes of data generated by commercial fleets into real-time actionable information, predictive analysis and prescriptive actions that drive measurable value for businesses.

Initially, Superior Paving will use the data to analyze smooth driving, hard acceleration, tight cornering and idling in order to increase fuel efficiency. As the company’s safety culture evolves, management plans to incorporate it into driver reward and recognition programs as well.

California-based SmartDrive Systems employs over 725 people worldwide and is ranked one of the fastest growing companies by Deloitte’s Technology Fast 500. n

GOODBYE, SWEET BEETLE Volkswagen announced in midSeptember it plans to cease production of its once and perhaps future retro Beetle nameplate. The original Beetle, brought to these shores some 70 years ago, was a hit and has been revived over the years, but lately has fallen victim to the SUV craze. Only 15,000 were sold last year, the company says.

MIRRORS SO 20TH CENTURY Lots of companies have talked about it, but Lexus will be the first mainline automaker to use cameras instead of side mirrors.

The new Digital Outer Mirror system will be on the Lexus ES in the Japan market in October, so it shouldn’t be long before they make it across the ocean. Audi is working on a similar system but it won’t be introduced until 2019.

NISSAN: ‘HEAVILY AMERICAN’ Nissan Motor Co.’s North American division chief responded to NAFTA talk recently by noting that his company is “heavily American.” Denis Le Vot told Reuters that his company will be able to comply with any new rules involving content.

Nissan assembles about a million vehicles annually in the United States.

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 19

EXECUTIVE Q&A INTERVIEW BY: NICK PATTERSON / PHOTOS COURTESY OF VOLVO

Jeff Moore, vice president of Manufacturing at the new Volvo plant in South Carolina talks about why the Palmetto State is the place for the luxury brand to build.

Volvo workers are just getting their new plant in South Carolina fired up with an eye on innovation.

volvo in South carolina

B

y the time you read this, Volvo’s first U.S. plant will be up and running in the South Carolina Lowcountry.

It’s a significant step for the Gothenburg Swedenbased brand, which has been a subsidiary of Chinese multinational automotive manufacturing company Geely Holding Group since 2010. The $500 million plant, sited on 1,600 acres in Berkeley County is expected to eventually employ somewhere near 4,000 people producing 150,000 cars a year. Vice President of Manufacturing Jeff Moore talked about the reasons for the South Carolina investment, and how Volvo Cars is positioned in the

current economic climate. He’s joined, particularly for a discussion of why workforce development is so important to the company, by Volvo Corporate Communications Manager Stephanie Mangini.

Q: What specifically made Volvo want to open a facility in the US? JM: I think it’s a commitment to the market…you know, the dealers I know have been clamoring for it for a long time, but it demonstrates Volvo’s commitment to this market. They’ve got a presence in Asia; they’ve got a presence in Europe; and now in North America.

20 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

Q: And why South Carolina?

JM: So, like most folks, infrastructure is kind of a big driver of site selection.

And we have the convenience of the interstate… I-26 is a direct connection to I-95, which is a good – logistically good infrastructure from highways. The other driver for us being a global company is access to the port at Charleston; so that was also a key factor in the selection.

So there’s a basic priority placed on infrastructure; beyond that it’s really based on the people in South Carolina.

So from the state government, to local government, to the people here in the community, and the employees that we’re able to attract,…I think Volvo’s just had a great experience in South Carolina.

Q: What are the specific advantages of the locale in terms of hiring and personnel?

JM: We’re in Ridgeville, outside of Charleston, South Carolina, we’re able to draw from a pool of about… a population of about 850,000 people here, which is… you wouldn’t really think that if you’d ever been here. But you know, that’s part of that…the benefit to being as close to the interstate as we are, if you look in a radius of an hour out, it’s 850,000 people here. So it’s a large pool of folks and we’re able to attract some really good people and enthusiastic folks. It’s been a good experience.

Q: Volvo’s US plant is in early days now [ the plant was scheduled to open within a month of the interview]. What challenges are you facing right now?

JM: I wouldn’t say…from my experience that the challenges that we’re facing are particularly unique, it’s simply getting a large plant up and running, bringing equipment in and getting it operational, and getting folks…We’ve got almost a thousand people now so bringing those people in and introducing them to Volvo

Volvo’s $500 million Berkeley County plant.

culture, teaching them how to build cars.

But we’re ramping up.

Q: How will the workforce expand over time?

By the end of the month it will basically be a thousand. As we add volume and content through next year and beyond that, we’ll go… eventually over three thousand. We’ll be pushing close to four thousand.

Q: So what’s the goal in terms of the number of cars produced this year?

JM: Yeah, this year we’re ramping up, so the capacity of the plant, you know - we’re going to launch with the S60 this year is for basically domestic, focused on domestic sales. Next year we start exporting. And beyond that we add the XC90 production. And once we ramp up on XC90, we should be pushing our 150,000 vehicle capacity.

Q: When do you hit capacity?

SM: Beyond 2021. So it’s over the next five years.

I think that’s really one of the driving factors of being here in the local market – you want to be able to capture the innovations and the market needs locally. — Jeff Moore, vice

president, Manufacturing, Volvo

Q: How is Volvo positioned to deal with the trade climate in view of the ongoing movement around tariffs?

JM: Yeah, a little bit difficult to anticipate where that’s heading, but… we’re a global company, we favor globally free trade, right? But specific to this plant, you know, I kind of mentioned the Port of Charleston. We’re Volvo’s first U.S. plant, but we’re not intending to simply produce for the U.S. market. Next year we’re adding exports, and this plant from the beginning was planned to be at least fifty percent export, so how are

we positioned to be able to deal with the lack of exports? Well, we’re not. It would be a significant impact to this plant if we are unable…you know, if there’s tariffs or retaliatory tariffs in place that limit our exports, then it’s going to limit our output and how much we can expand here.

Q: So obviously with the uncertainty, Volvo must have plans to address whatever eventualities are coming. Can you talk about any of that?

JM: Yeah, again from a Charleston standpoint, the reason why we have a thousand employees now and not four thousand is because we’re going to add as we go. So, you know, we’re planning to export next year and if we can’t export then we won’t hire those people. I prefer to focus on the upward flexibility, though, than the downward. (Laughs) Q: Can you talk about how the U.S. plant is positioned to sort of drive innovation, respond to innovation, etc.?

JM: Yeah, so from a product standpoint, certainly Volvo is pushing the envelope and continuing to, I think, lead the industry from a safety standpoint. I think with the product revamp, it’s safety with performance would be the way I’d say from our product portfolio. So from a manufacturing standpoint, it’s our responsibility to be able to bring those products to market. I think it’s the ambition of Volvo to ensure that no one is seriously injured in a car by 2020. I think it speaks to the commitment to safety that’s really driving the company.

And all those vehicle technologies we’re

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 21

E X E C U TI V E

Q& A

WOR KFORC E DEVE LOPM E NT

Q: How does the workforce development climate suit Volvo’s needs?

JM: What I’ve been pleasantly surprised since I’ve been here is with workforce development here in South Carolina. We’ve worked with the state of South Carolina, and with local technical schools and the local high schools to implement this Lean Manufacturing Certification Program. And that’s been very effective for us to get folks prepared before they even start at Volvo. I don’t know that that’s unique to us, so much, as just because we are a start-up and hiring so many people at once, it’s clearly highlighted how important that is in our position and I think that continues to be the thing that we need to work on as an industry.

Q: Right. And South Carolina has some unique programs for workforce development.

SM: You know, we knew that coming here we would have a workforce that may not have the manufacturing experience, but certainly wanted the job opportunities. You know, when we spoke to the community as we were setting up the construction, one of their biggest concerns were are you going to hire people here, or are you going to bring people in from the outside? And so we knew we had to make a commitment to hiring locally, but we also knew that in terms of what we needed for talent, we needed people with manufacturing experience, at least one year.

Q: How does Volvo work with the state?

SM: We worked with the Commerce Department and state and local officials to say we need to come up with a program that is compressed, that somebody who doesn’t have the manufacturing experience, but has a high school diploma and wants to get involved in manufacturing as a career, can take a 62-hour compressed curriculum through our local technical school. And once you receive that certificate, that satisfies one year of manufacturing experience for us. Now this program has expanded so it’s not just Volvo. Mercedes is accepting this; BMW is accepting this; our key suppliers in the upstate and here are also accepting this certificate as one year…in lieu of one year of experience. So this program has truly expanded and it started as a pilot here with Volvo.

Q: How important is it to get to young potential workers early?

JM: Stephanie…talked about the kind of post-high school approach, but we’re now pushing that into the high schools which I think is even more powerful from a longterm standpoint.

People have an image of manufacturing and they have a lot of parental pressure to go to college and all this thinking that they’ve got to do that, you know, so it’s great to get into the high school in front of the parents and let them know what manufacturing is really like these days, high technology and all. n

22 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

capable of and will be putting in our car – the S60s that we produce here – there’s, as you know, a lottery list of those for Volvo.

Environmentally, the same way so we’re launching this year with conventional power train and we’ll add hybrid power trains to the S60 next year. So we’re positioned to meet those commitments from an environmental standpoint, as well.

Q: How does this U.S. plant fit in to the ongoing evolution of what you do at Volvo?

JM: I think that’s really one of the driving factors of being here in the local market – you want to be able to capture the innovations and the market needs locally. So between the plant here, the sales and marketing folks up in New Jersey; we have technical operations out in California as well that are very focused on the innovation side. Another benefit of having a plant here....We’ll continue though as the operations in California are expanding, we’re expanding and we’ll be able to contribute more from the manufacturing side with that innovation.

Q: How has Volvo changed under Chinese ownership?

JM: What I think is changed is the investment in Volvo from Geely. That investment has allowed a total redo of the product portfolio, right? And I think that’s what’s driven any kind of a change within Volvo - to be able to have access to that capital and make those kinds of changes and …the trickle-down effect of the pace of change and innovation has increased.

Q: In the immediate future with ramp up coming before this story comes out, what are you looking forward to in the next couple of months there at your plant in the U.S.?

JM: Well, I think our team members, you know, we’ve been running production trials and training.... Improvement spirit is all the way down to the shop floor. They’re making improvements to their processes and they can’t wait to get started. It’s just like everyone is really itching to hit the go button and start from job one and get into mass production, so that’s what everyone is really focused on and looking forward to here. n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 23

INDUSTRY OUTLOOK

TARIFFS Auto industry observers say NAFTA re-do and tariff issues signal higher vehicle prices

I

t likely will be three to four months before details of the preliminary agreement to replace/revise the North American Free Trade Agreement between the U.S. and Mexico are worked out.

President Trump and Mexican leaders announced in late August they had reached a preliminary agreement but Canada, the other partner in NAFTA, is still not in the fold.

In addition, car companies are also watching to see if anything will come of a European Union proposal to eliminate tariffs on vehicles and other industrial goods if the United States agrees to do the same.

The Auto Alliance, the leading

TEXT BY: BILL GERDES

advocacy group for the auto industry, represents 70 percent of all car and light truck sales in the United States, including the BMW Group, Fiat Chrysler Automobiles, Ford Motor Company, General Motors Company, Jaguar Land Rover, Mazda, Mercedes-Benz USA, Mitsubishi Motors, Porsche, Toyota, Volkswagen Group of America and Volvo Car USA. In a statement on its website, the Alliance says, “Automakers support modernizing NAFTA to bring this nearly 25-year-old agreement into the 21st century. We are pleased to hear that the U.S. and Mexico have reached a consensus on several issues, including automotive rules of origin, and we look forward to learning more.

24 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

“Automakers urge the U.S. and Mexico to quickly re-engage with Canada to continue to build on this progress. The industry is hopeful that any changes to NAFTA auto rules of origin continue to strike the right balance by incentivizing production and investment in North America while keeping new vehicles affordable for more Americans.”

Kristin Dziczek, vice president at the Center For Automotive Research, a nonprofit research organization in Ann Arbor, Mich., says that when it comes to the NAFTA issue, modernizing NAFTA won’t be easy and the “the devil is in fact in the details here in many, many ways. “ Dziczek says auto makers are “largely confused and are just as much in the

dark as the rest of us are. I think largely they feel that they have dodged a bullet,” adding that there is some relief that the end of uncertainty may be near and it is encouraging that Mexico has received some tariff relief.

“About half of the cars and parts that are imported to the United States come from our NAFTA partners so if you can get Canada and Mexico exempt from any more tariffs, then the outcome is negative but not as negative as it would have been.”

New Hoops To Jump Through As for NAFTA, Dziczek says, “What we know from the outlines that we have as to what the U.S. and Mexico have agreed to is, that the deal is really not all that different from what it was last spring.”

But, she says, “There are different hoops to jump through than we had before.” And it may take a while to work through those hoops.

“In the current NAFTA, the one in place now, there is a list of parts and you have at least 62.5 percent of that list of parts come from North America in order to be in compliance or conforming to NAFTA rules,” she says.

According to Dziczek, close to 100 percent of cars and 80 percent of parts that come to the United States conform to existing NAFTA rules.

“That 62.5 percent, which is the highest regional value content of any U.S. trade agreement, car companies and suppliers are largely conforming to that,” she says.

But still, she says, “The new rules have a bunch of hoops to jump through that are different. One of the criticisms of NAFTA was that that list of parts was not very modern. It included stuff that we don’t put in cars anymore like cassette decks and distributor caps.

“The content of vehicles has changed and evolved over time and the trade codes haven’t and so they wanted to come up with a system that allowed parts content to change as the vehicles changed. So there is no set list anymore, there are different categories of parts,” she says, adding that there are three rules

governing the agreement.”

Rule No. 1 is that 75 percent of the parts for the vehicle will have to come from North America, Dziczek says.

Rule No. 2, according to Dziczek, is that at least 70 percent of steel and aluminum (and potentially glass as well) would have to come from North America “so you can’t use Chinese steel to make your cars in the United States or in Mexico or Canada.”

The third rule, she says, is that a certain percentage of the vehicle’s value has to be created by workers who earn at least $16 an hour, which has been set as the median North American wage.

“We are not exactly sure how that is going to work,” Dziczek says. “We don’t know if that is at the company level, the plant level, the state level or what – the unit of analysis is not clear.”

The Mexican Exemptions Also, she points out, Mexico received a side letter that addressed two different points.

“If the U.S. puts in additional tariffs on imported cars and parts under the 232 investigation (national security concerns) that is ongoing, Mexico has a side agreement that says if you do that, a large majority of what we do will be exempt from those tariffs,” she says.

“The other part or side letter is if the United States were to raise its tariff rate with the rest of the world which now is 2.5 percent for cars and parts and 25 percent for trucks, Mexico would be grandfathered in with a large percentage of their output being subjected to the existing 2.5 and 25 percent tariffs on trucks. So they have gotten an agreement to be exempt from future tariff action.”

The NAFTA and tariff issues can have a serious impact on the South, where auto makers have plants spread across the area, including Toyota in Lexington, Kentucky and Huntsville, Alabama; Mercedes in Vance, Alabam, Honda in Lincoln, Alabama, Kia in West Point, Georgia, Hyundai in Montgomery, Alabama, Nissan in Smyrna, Tennesse, and Canton, Mississippi, BMW in Spartanburg, South Carolina, and

There are different hoops to jump through than we had before. —Kristin Dziczek, vice president at the Center for Automobile Research the huge new Volvo plant outside Charleston, South Carolina.

South Carolina, For Example The Spartanburg plant is BMW’s biggest in the world. It has helped draw more than 200 companies from two dozen countries to Spartanburg County. And the German company is now the largest exporter of cars made in the United States, turning the port of Charleston into a hub for global trade.

Gerald A. McDermott, professor of international business at the Moore School of Business at the University of South Carolina, has worked with and observed the development of the auto business in South Carolina for several years.

“I can’t tell you that an X percentage of a tariff will have a Y dollar effect on the cost of a car,” McDermott says. “But if we are thinking about South Carolina, here is how we would put this into perspective.

“Think about exports. Exports to Gross Domestic Product in South Carolina is 15 percent,” McDermott says.

To put that into perspective, according to 2017 numbers from the department of commerce of the U.S., South Carolina depends more on exports than most other auto-making states in the South.

McDermott says South Carolina’s

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 25

I N D US T R Y

O U TLO O K

Volvo’s first U.S. plant in South Carolina.

top export countries are China, Canada, Germany, Mexico and the United Kingdom. The highest growth in the past few years has been in exports to Mexico.

“The top exports that come from South Carolina are motor vehicles, aircraft, industrial machinery, rubber and electrical machinery. Don’t forget we have the tire companies. In South Carolina one out of every four jobs

South Carolina is sitting in the cross hairs. —Gerald

McDermott, professor, Department

of International Business, University of South Carolina

depends on international trade,” according to McDermott.

Of course, with two of the top export markets for South Carolina being Canada and Mexico, the NAFTA issue is bothersome.

“The whole Southern region is heavily impacted by globalization,” McDermott says. “Ten percent or more of its economy comes from direct imports, and if you are looking at global value chains, and if you look at indirect exports, it is probably double that.”

“So when you get into these tariff discussions,” McDermott says, “South Carolina is sitting in the cross hairs because when you look at big, big products, like BMWs, 80 percent of the exported cars go through the Charleston port.

“Now in terms of NAFTA, if you screw around with NAFTA too much, what is really going to hurt is you are going to see an increase in the price of cars. With cars you can’t do global sourcing; it is regional sourcing, usually within a 400-mile radius because you have a lot of just-in-time delivery.

“In the South, what they are worried about more is selling into Mexico and

26 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

Canada. We make a lot of tires that go to Mexico. We know that Canada and Mexico have been increasingly important markets for South Carolina.

We know a lot of that is related to manufacturing, particularly auto systems manufacturing.”

Future Changes?

The auto industry has been adding jobs in the United States for several years. In July, more than 972,000 people worked for car and parts companies, 40,000 more than a year earlier, according to the Bureau of Labor Statistics. Manufacturers have added more than 300,000 jobs since 2009, many of them in the South.

But, says Dziczek, that may change. ’The main takeaway so far is there is no giant influx of jobs coming into the U.S.,’’ she says.

Industry analysts say consumers might be pulling back on spending because of tighter credit conditions and more expensive vehicles and the new agreement will push production costs higher on Mexican products — parts and vehicles — which, eventually, will be paid by American consumers. n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 27

INDUSTRY OUTLOOK

CHANGING CLIMATE Fed era l gover nment looks to rew ri te re g u lati on s on fuel ec onomy, gre e n h ou s e emi s s i on s .

TEXT BY:BY GAIL ALLYN SHORT

T

he Trump administration has taken another step on the road to amending Obama-era rules on vehicle fuel economy and greenhouse gas emissions for MY 20212026 cars and light-duty trucks.

On Aug. 2, the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) together unveiled a Notice of Proposed Rulemaking (NPRM) that suggested changing the Obama administration’s Corporate Average Fuel Economy

(CAFE) rule. The CAFE rule requires all automakers to produce passenger cars and light-duty trucks that would average about 54.5 miles per gallon by the year 2025.

The government’s NPRM proposes freezing the current fuel economy standard at the MY 2020 level of 37 miles per gallon and setting new standards for the model years 2021 through 2026. The NPRM also suggested ditching the waiver that lets California and other states set their own tougher fuel economy and greenhouse gas standards in favor of one national standard.

28 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

“Our proposal aims to strike the right regulatory balance based on the most recent information and create a 50-state solution that will enable more Americans to afford newer, safer vehicles that pollute less,” EPA Acting Administrator Andrew Wheeler said in a press release.

Regardless, the Association of Global Automakers and the Alliance of Automobile Manufacturers, two advocacy groups representing several automakers including Honda, Hyundai, BMW, Mercedes-Benz and Toyota, issued their own joint response that day.

“Automakers support continued improvements in fuel economy and flexibilities that incentivize advanced technologies while balancing priorities like affordability, safety, jobs, and the environment,” the release says. “With today’s release of the Administration’s proposals, it’s time for substantive negotiations to begin. We urge California and the federal government to find a common sense solution that sets continued increases in vehicle efficiency standards while also meeting the needs of America’s drivers.”

The Clock’s Ticking Meanwhile, the NPRM started the clock on a 60-day comment period for the federal government to collect public opinions about the proposed rule change. Following that period, the government will make a final ruling.

The NPRM came after the Trump administration conducted a mid-year review of the CAFE rule and concluded that current CAFE needed revising.

Carla Bailo, CEO and president of the Center for Automotive Research, headquartered in Ann Arbor, says that a rule change could bring relief to automakers struggling to meet the CAFE standard.

“It [CAFE] required a large increase of electrification of all their portfolios,” says Bailo, “and quite frankly, American customers simply aren’t purchasing those. So everyone was going to be stretched to meet that. The automakers didn’t necessarily come out and say freeze at the 2020 level, but they did appreciate the mid-year review and some alteration.”

“The one bit to the proposal that the automakers are still struggling with, and this will be addressed in the 60day remark period, is the segregation of California,” says Bailo, adding that “Automakers have wanted one standard for a long time.”

Already Electrifying Overall, car companies have increased their offering of electric vehicles (EVs) in recent years as

Our proposal aims to strike the right regulatory balance based on the most recent information and create a 50-state solution that will enable more Americans to afford newer, safer vehicles that pollute less.

—Andrew Wheeler, EPA acting administrator environmentally friendly alternatives to traditional, gas-powered vehicles.

And the U.S. Energy Information Administration (EIA) reported in May that between 2012 and 2017, the number of available EV models went from 58 to 95. For example: Mercedes-Benz U.S. International located in Vance outside Tuscaloosa, Alabama, has committed to invest $1

billion in its plant to start production of electric vehicles and batteries.

Nissan currently produces the Nissan LEAF battery electric car at its Smyrna, Tennessee, plant.

At the end of 2017, the BMW plant in South Carolina announced that more than 12,000 electric hybrid SUVs rolled off of its assembly line.

In addition, Denso, which makes

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 29

I N D US T R Y

O U TLO O K

It [CAFE] required a large increase of electrification of all their portfolios, and quite frankly, American customers simply aren’t purchasing those.

So everyone was going to be stretched to meet that.

— Carla Bailo, Center for Automotive Research

parts for companies like Toyota Motor Corp., said the company would invest $1 billion in its Maryville, Tennessee plant to manufacture parts for EVs, hybrids and self-driving vehicles.

Nevertheless, EVs, including hybrid electric, plug-in hybrid electric and battery electric vehicles, have failed to grab much market share. The same EIA report shows that EVs made up only 2.5 to 4 percent of total cars and light-duty truck sales between 2012 and 2017.

The hindrance for a full battery electric vehicle, says Bailo, is that the infrastructure for charging stations is still lacking in most parts of the country.

“Plus the cost is still relatively high, and the range is a little bit low,” says Bailo. “Most people have range anxiety.

They worry about where they’re going to charge it.”

The few areas of the country where hybrid vehicles sales have grown are mostly in places the with a welldeveloped charging infrastructure like California and states that have incentive programs.

But despite the lagging U.S. market demand for EVs, says Bailo, automakers still have to meet the standards set

in other countries where the fuel economy and GHG emission standards are stricter.

“When you look at who is leading around the globe right now, it’s Europe and China,” says Bailo, “and therefore, the electrification of those products needs to still proceed. And most of the automakers, since they have a five-year lifecycle, already had plans in place to be able to meet those standards, plus strive as hard as they could to meet the 2025 EPA ruling.

Meanwhile, an advocacy group for auto parts suppliers has expressed concern that a rule change might impede progress in the move toward increasing fuel economy and lowering GHG emissions, create more uncertainly and cost jobs.

In a statement on Aug. 2, the Motor Equipment Manufacturers Association (MEMA) which represents suppliers, said. “MEMA is currently reviewing the lengthy NPRM document, however, we are hoping that the administration has addressed MEMA’s requests that the rule maintain the stability and predictability that our member companies need for continued growth.

“MEMA strongly supports a One National Program negotiated between California, U.S., EPA, and NHTSA. MEMA strongly supports forward progress in the fuel efficiency and vehicle emissions standards.

Suppliers also support further program flexibilities, including enhancing the off-cycle technology credit program to provide automakers multiple options for meeting the standards.”

Back in 2012 when the Obama administration finalized its fuel efficiency standards, it said CAFE would save consumers $1.7 trillion at the pump, lower the nation’s oil consumption by 12 billion barrels and lower oil consumption by more than 2 million barrels a day by 2025. Moreover, the administration argued that its standards would cut GHG emissions from vehicles by about half by 2025.

In contrast, the Trump administration says its new rule would

30 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

increase U.S. fuel consumption by a half million barrels a day and “impact the global climate by 3/1000th of one degree Celsius by 2100.

But a May 3, report by the Rhodium Group, an independent research firm based in New York City, suggests that, “Because CAFE standards are based on vehicle footprints, the ultimate impact of the standards depends in large part on which types of cars people buy. That, in turn, depends on prices at the pump.”

The report argues that when gas prices rise, U.S. consumers tend to purchase vehicles with a “smaller footprint,” thereby increasing the fleetwide average fuel economy. But when gas prices are low, consumers often pick larger vehicles, and the fleetwide average fuel economy falls.

The Rhodium report says, “Freezing CAFE standards at 2020 levels would increase U.S. oil consumption by between 126,000 and 283,000 barrels per day in 2025, depending on oil prices. By 2030 the impact grows to 221,000-644,000, assuming no change in post-2025 standards, as more of the vehicle fleet has been sold under the MY 2020-2025 rules.”

The Future?

But if an administration in the future considers revising the standards, the effort would lower the starting point and delay low-carbon research and development, in addition to manufacturing investment by American automakers, the Rhodium report says.

Bailo says startups engaged in developing innovations to reduce fuel usage and GHG emissions worry about efforts to slow down progress to make vehicles more environmentally friendly.

“If our standard is far below the rest of the world, the rest of the world is where the startups and the innovators are going to go,” says Bailo.

“In technology, those who lead the race are those who are doing the work. It’s a risk, and it’s something we have to think about.” n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 31

VISION

A Forward Thinking Legacy In Mobility

The Ray: Building the Interstate of the Future in Rural Georgia TEXT BY: CARLA CALDWELL / PHOTOS COURTESY: THE RAY/CARLA CALDWELL

A

n 18-mile section of Interstate 85 in rural west Georgia provides a glimpse of what interstates throughout the country could look like in the future. The span of interstate is called The Ray. There is an electric vehicle charging station, and a tire safety check station where motorists can roll over a monitor at 15 mph and in seconds receive a text that displays tire pressure and tread life. Both projects are powered by solar energy and are free to use.

There is a 7,000-square-foot pollinator garden that attracts honey bees, monarch butterflies and other species; and soon a small farm crop will be planted on interstate right-of-way to take advantage of available land.

The Ray also is host to Francebased Colas’ pilot project in the U.S. — a 50-square-meter section of pavement in front of the Georgia Visitor Information Center in West Point, Georgia, near the Georgia-Alabama state line. The project uses photovoltaic cells to provide clean, renewable energy in the form of electricity. It offsets power usage at the center and cars can drive over the installation.

Construction is set to begin in October on a solar project that will make Georgia the third state in the country to use interstate highway right-of-way to generate solar energy, and the first state to pilot pollinator-friendly right-of-way solar. Native flowering plants will be

32 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

used as ground cover to determine which varieties best reduce erosion, maintain soil stability, reduce maintenance and support local ecology.

The Ray is a living laboratory and proving ground for ideas and technology that aim to create safer and cleaner methods of transportation in the United States and throughout the world, according to Allie Kelly, The Ray’s executive director. It’s also a charitable foundation and a movement, she said.

The Ray was created in 2014 when Georgia Gov. Nathan Deal designated the 18 miles of interstate the Ray C. Anderson Memorial Highway to honor the founder and chairman of carpet giant Interface Inc. Anderson started the carpet tile company in the 1970s using $20,000 from his daughters’ college fund and grew it into a global leader valued at more than a billion dollars. The corridor begins at the state line in West Point, Ga., where Anderson was born, and ends at Exit 18 in LaGrange, Georgia, where Anderson started the company.

The Georgia Tech graduate and engineer died in 2011, shortly after he was diagnosed with pancreatic cancer.

Anderson was known for his strong belief that companies throughout the world could become more profitable by doing more for the environment.

He delivered about 150 speeches a year on the topic, and inspired companies including The Coca-Cola Company, Walmart and Unilever.

Ray Anderson wasn’t always so green-minded.

“It is important for people to understand that Ray Anderson was not preoccupied with the environment,” says Kelly. “He was a numbers guy, hardnosed, super competitive and always selling; but a charming Southern man.

He started out on a shoestring and

The pressure is always wrong on at least one of the tires on my Ford Fusion. It just takes a minute to drive through the tire monitoring system and receive a report. There’s also a free air machine where you put in the correct pressure and the machine inflates the tire for you.

In Athens, air is $1.50, and you have to have quarters.— UGA

graduate student Matthew Quirey

created a classic American success story.”

A couple of things happened in the 1990s that prompted Anderson to transform Interface into a global leader in sustainability. He became a grandfather, and he began to feel pressure, externally, from designers who were buying his products, especially on the west coast; and internally from his own employees. Anderson heard the growing chorus and set out to learn what he could do, Kelly says.

“Anderson had an epiphany. He realized all carpet eventually goes to a landfill and that it takes about 300 years to break down. He began to refer to himself as a plunderer of the environment and made it a mission to divert all of Interface’s waste out of landfills,” she says.

Interface became a model for other companies and was the first company to recycle old carpet into new carpet, Kelly adds.

“No one expected Anderson to die soon after he was diagnosed with pancreatic cancer,” Kelly says.

“Everyone was in shock, especially his two daughters. Most of Anderson’s wealth was bequeathed to start the Ray C. Anderson Foundation, but there wasn’t any paperwork to outline what the family foundation was supposed to be. They had a lot of millions and a new foundation and no instructions.”

Anderson’s daughter, Harriet Langford, who is trustee of the Ray C. Anderson Foundation and president of The Ray, was working on a way to honor him in the community. She worked with Georgia’s governor and state legislature to name the highway in his memory, but later questioned if a highway was the right choice.

Kelly describes what happened.

“The day Gov. Deal signed the bill, Harriet goes home to LaGrange and as she and her husband are on the back porch having a glass of wine to celebrate, she looks at him and says,

‘I just put the name of the greenest industrialist of the century on a dirty highway. Think about all the car wrecks, dead animals, cars polluting the air and rolled up tires on the side of the road.

What is sustainable about a highway?

Daddy would not like his name being on a highway.’ She had her own epiphany just like her dad did in the 1990s. She asked the question, ‘What if highways were safe and sustainable and smart?’

And she started on a journey.”

The Ray was started in 2014 to address those ideas. It was part of the family foundation, but in 2015 became a 501(c)3 managed by a board of five, staff of two and two interns. The foundation could make grants to organizations but was supposed to work off the endowment of the estate and not take in new funding. The Ray, which has an office on West Peachtree Street in Atlanta and space at the visitor’s center, enables public-private, philanthropic partnerships and welcomes ideas.

The large solar energy project breaking ground in October received the green light in August, when the Georgia Public Service Commission approved funding for Georgia Power to construct, own and operate the one-megawatt solar array with 2,600 high-efficiency panels on Georgia Department of Transportation (GDOT) property on The Ray. The electric grid is expected to

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 33

VI SI O N

begin receiving energy in spring 2019.

Solar energy produced there, and all associated renewable energy credits will benefit Georgia Power customers.

“We believe there is a natural connection between energy and transportation,” Kelly says. “Not only can we safely generate renewable energy using transportation infrastructure that we already own, but departments of transportation all over the country have the opportunity to tap into a brand-new revenue source through land leases, lower energy costs, credits and other business models.”

Kia Motors Manufacturing Georgia (KMMG), which is located on the 18mile corridor, partners with The Ray. “Kia is more than a mobility provider, we are moving people forward and upward,” says Stuart C. Countess, KMMG’s chief administrative officer.

“Our partnership with The Ray is important because it gives people the opportunity to experience innovation in mobility in our backyard. Safe mobility and eco-mobility are two key principles shared by KMMG and The Ray.” Kia Motors America sponsored The Ray’s electric vehicle charging station that opened in 2015 at the interstate visitor center.

“For us, there was a critical gap that Kia wanted to address with electric

charging,” says Corinne Hodges, senior manager/head of department, public relations at KMMG. “We don’t build electric vehicles in Georgia, but Kia does make electric cars.”

Prior to installation of the station, most electric cars could not make the drive from Atlanta to Montgomery because there was nowhere to charge, says Hodges.

A Ray partnership with KMMG brought the WheelRight Tire Pressure Monitoring System to the visitor center.

“Many drivers don’t know if their tires are over inflated or under inflated,” says Hodges. “This can cause accidents.

The roll-over system installed at the information center provides tire pressure, and tread depth at hundreds of points. Typically, people test tread depth with a penny. That measurement is flawed, because often people check tread at only one point in the tire.”

According to the International Tire and Rubber Association, tire underinflation is the single most common factor in tire failure.

Matthew Quirey, a landscape architecture graduate student at the University of Georgia, stops to check his tires every time he travels home from visiting friends in Alabama.

“It’s free and it’s high-tech,” says Quirey. “The pressure is always wrong on at least one of the tires on my Ford Fusion. It just takes a minute to drive through the tire monitoring system and receive a report. There’s also a free air machine where you type in the correct pressure and the machine inflates the tire for you. In Athens, air is $1.50, and you have to have quarters.” n For more information about The Ray, go to theray.org.

We believe there is a natural connection between energy and transportation. Not only can we safely generate renewable energy using transportation infrastructure that we already own, but departments of transportation all over the country have the opportunity to tap into a brand-new revenue source through land leases, lower energy costs, credits and other business models.

— Allie Kelly, Executive Director, The Ray

34 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 35

WORKFORCE DEVELOPMENT

A Mentor Inside And Outside Of The Classroom

D

Dr. Bob Woods paves the way for careers of excellence through Formula SAE at UT Arlington TEXT BY: BY LAWRENCE ELIZABETH KNOX PHOTOS COURTESY: UNIVERSITY OF TEXAS, ARLINGTON 36 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

r. Bob Woods has a full schedule with his responsibilities as a long-time mechanical engineering professor at the University of Texas at Arlington.

He teaches a handful of courses geared toward specific aspects of engineering, such as the components of control systems and the modeling and simulation of dynamic systems. He also supervises students working on their capstone senior design project.

That project covers all topics necessary to succeed in the industry from economics and ethics to psychology and finance to patent law and product liability and everything in between.

Yet, his impact extends far beyond the classroom. In 1978, when a number of his students expressed an interest in Mini Baja, a design and racing competition sponsored by the Society of Automotive Engineers, Woods agreed to serve as their advisor. Ever since, he has dedicated much time to this venture – one that, although not required, has proven significantly beneficial in ways that no textbook or classroom could.

Woods wasn’t initially very involved in the day-to-day activities, not until he witnessed his first Mini Baja competition in Phoenix, where a team from another school gave up its only spare master link so that his students could fix their car and continue in the 4-hour endurance race.

“It occurred to me that it was car against track, not team against team,” Woods says. “Suddenly, I got hooked, and here I am some 40-something years later, still doing it.”

Spearheading the team seemed to be a natural progression for Woods, who recalls working on lawnmowers with his father as a child. The

Oklahoma native always had a liking for motor scooters and bicycles, and in high school, he souped-up his first car for drag racing.

He earned a bachelor’s degree from Southern Methodist University, then a master’s degree and PhD from Oklahoma State University, after which he lived in Washington, D.C. and worked in research for three years. In 1974, Woods returned to Texas to join the UTA faculty at the encouragement of a colleague.

By 1982, the racing team graduated to the more sophisticated Formula series, in which a motorcycle engine is placed in an open-wheel racecar, and each year, the students typically select three areas to adjust from the previous model, avoiding the impracticality of full redesigns. Their cars have included four-cylinder engines, turbocharged engines, carbon fiber, active aero with which the flap wings open and close automatically by way of computer, and an innovative pneumatic servo clutch and shifter.

In total, the team has had eight victories in the two annual United States competitions – Michigan in May and Nebraska in June – and they’ve won three international events in

England, Australia and Japan.

“Some schools run this as a senior design course,” Woods says. “To me, that’s just fool-hearted because it takes a whole bunch more time, commitment and knowledge than that.”

For this reason, the UTA team functions as a volunteer organization and is open to any grade level. Fifty students typically dwindle down to about 30, a third of whom make up the majority of the workforce, Woods says, and members spend anywhere from 10 to 40 hours a week in the shop. He recalls once receiving texts from his department chairman with an image of students already working at 6 a.m. “He would say, ‘Look, Bob. These guys are so ambitious, they’re already here.’ And I said, ‘They are there from last night.

They spent the night.’”

That kind of commitment is something recruiters don’t take lightly.

“The fact that you’ve been on the team and held a responsible position qualifies you unconditionally for a job,” Woods says. “We teach them things about working on schedule, being on a budget, working within a team, relying on somebody else to do their part and making compromises of design opinions and so forth.”

One such dedicated former student is Tim Patek, who was on the team for eight years of his undergraduate and graduate studies. During this time, Patek designed and built molds for carbon fiber wheels that were used on the 2004 car and through the next 12 years with a couple of iterations. He attributes finding meaningful work in the industry to an all-encompassing, hands-on experience like this, and interestingly enough, he met his current employer, Peterbilt Motors Company, while still a student, taking bodywork molds to be cut on the mill.

Patek is now a senior project engineer, designing brake systems, recruiting engineers, speaking at universities and providing tours of the diesel truck manufacturer’s production plant. He also serves on the board of the SAE Texas Section.

“Students in the program gain experience most won’t find even in an

It occurred to me that it was car against track, not team against team. Suddenly, I got hooked, and here I am some 40-something years later, still doing it —Bob Woods

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 37

internship,” Patek says. “Learning how to motivate peers to solve problems with you that you have no supervisory control of is one of the hardest skills to obtain. In industry, there is chain of command structure and incentive to maintain employment to motivate people to work together. In a volunteer program like Formula SAE, it is more difficult for students to correlate results at the end of the year at competition to how they work with peers on a daily basis. The students that see this vision are the ones that employers want.”

Erick Kohler was also a team member for eight years, having joined as a freshman in 1998. Now Kohler works as a rotor and drive system analyst for Bell Flight, an aircraft manufacturer of commercial and military helicopters.

Although he is no longer in the automotive industry, he said his experience on the team has proved valuable to him throughout his career.

“This program benefits all industries by providing a student with the opportunity to take an idea through all phases of development,” Kohler says. “Dr. Woods takes the experience further. He pushes for excellence and

pushes each student to reach their full potential. The desire is for the students to make an educated, data-driven decision, and in cases where there is ambiguity, dig deeper to find the necessary data.”

His favorite material used during his tenure as a student was aircraft fabric, which the team stretched around the tubes of the chassis, or framework of the car. It’s lightweight, durable, relatively inexpensive and easily reparable, he explains. “We have racecars over 30 years old with their original fabric covering that are still fantastic looking today.”

Kohler also coincidentally took note of the carbon fiber wheels for making a significantly noticeable impact on acceleration, braking, and suspension.

While most teams either destroy their cars or recycle the parts, UT Arlington is the only school that keeps each and every one, Woods says. So last July, when his team was asked to return to England for its 20th anniversary celebration, Woods took 18 former and current students and two cars – the 1998 model, which won the country’s inaugural event, and its original drivers.

38 | Southern Automotive Alliance / OCTOBER/NOVEMBER 2018

He also took along his present-day team and a new car to participate in the 2018 competition.

Australia is also approaching its 20th anniversary, and the team has already been invited to attend the ceremony in December of 2019 – what will likely be their next international trip, Woods says.

Last November, an endowed chair – one of the highest awards a university can bestow – was established in Woods’ honor through a $2.2 million gift from entrepreneur and businessman Paul E. Andrews, Jr. The donation will support the automotive engineering program at UTA, but more specifically, it will secure the continued legacy of Woods and his racing team, from which former students have been offered jobs with Formula One, the American Le Mans Series, the IndyCar Series, and the Newman-Haas Racing team.

“There’s something that I like to quote,” Woods says. “Universities graduate students. An industry makes an engineer out of them about two years later. At Formula SAE, they graduate as engineers, as experienced engineers, so they’ve already got a 2-year jump on anybody else.” n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 39

CLEMSON GOES DEEP What will the car of the future look like? Students in the Deep Orange progarm are developing cutting-edge designs.

At CU-ICAR, grad students build a car from scratch in the Deep Orange program – and forge relationships with industry partners TEXT BY: LINDA LAMB / PHOTOS COURTESY OF: CU-ICAR

ike a futuristic castle for car geeks, the Clemson University International Center for Automotive Research sits overlooking Interstate 85 with an edifice that’s all silvery surfaces, sharp angles and glass that gleams in the South Carolina sun.

Inside CU-ICAR, something equally dazzling is going on. Drawn from each successive class of the two-year graduate automotive engineering program, a team of students starts with nothing but an idea, and ends up with a stunning, roadworthy vehicle.

The program is called Deep Orange – because it’s a deep dive into the auto engineering process and because, well, everything connected to Clemson is orange.

“It’s a fantastic opportunity to learn about many different aspects of a vehicle, in a scale like they would in 40 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

A lot of the technologies that are important to the auto industry are also important to other industries as well.

—Nick Rigas, executive director of Clemson University’s International Center for Automotive Research (CU-ICAR)

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 41

P A N OZ CU-ICAR was founded in 2007 and nearly 70% of its research is sponsored by industry.

industry, but in an environment where everything is a learning experience,” says Chris Paredis, director of Deep Orange and the BMW endowed chair in systems integration.

All engineering programs require a “capstone” design project of some sort, says Paredis, who previously held faculty positions at Carnegie Mellon University and Georgia Tech.

Some have students design and build a vehicle, typically as part of a competition.

But he says Deep Orange is unique in that only master’s degree students are involved – and in its scope and complexity. Started on a relative shoestring 10 years ago, the program now typically draws challenges from industry partners that help provide seven-figure budgets. The first 10 Deep Orange projects have included: An “urban mobility” vehicle created for Generations Y and Z – with double-hinged doors for versatility and a stylish interior to promote an emotional connection. (Primary sponsor: General Motors.)

The UBox, a sport utility vehicle

with space for bikes, plus a handy exterior connection so someone can plug into a scenic spot and connect a laptop. (Primary sponsor: Toyota.)

A reinvention of the Mini – in partnership with the BMW Group in Munich, Germany – aimed at maximizing space and providing a fun driving experience.

A hybrid rally car, engineered not just for fuel efficiency but for handling the rugged conditions that motorsports enthusiasts seek out. (Primary sponsor: Honda.)

Some of the sleek prototype vehicles are on display at CU-ICAR’s Greenville campus, tangible reminders

We see ICAR as one of the top resources we have for recruiting new companies. It’s a huge advantage for economic development. — John Lummus,

president and CEO of the Upstate SC Alliance

42 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

of what Deep Orange collaborations can achieve.

“It has really led to some interesting concepts,” according to Nikolaos “Nick” Rigas, who was named executive director of CU-ICAR early this year.

“Industry has embraced it with ever more unique projects.”

Synergy With Industry Links between Deep Orange and its automotive industry sponsors

reflect synergy that’s been essential to CU-ICAR since its founding in 2007. Some 67 percent of the research done on its campus is industry-sponsored. Streamlining manufacturing, coping with weight limits, moving toward hybrids, using robotics, the autonomous trend…if it’s important to the auto industry, there’s a multidisciplinary team at ICAR working on it.

“There has to be a value proposition

for industry,” says Rigas, who believes the most important value is access to ICAR’s best and brightest grads. The university says 95 percent of ICAR students snag jobs in the auto industry.

Beyond that, the center’s focus on systems integration brings a diverse mix of specialists – in engineering, design, even psychology – into the problem-solving process. That’s vital, Paredis says, because there are so many aspects to modern car design

Chris Paredis, director of Deep Orange and the BMW endowed chair in systems integration.

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 43

SP OTLI GH T Students in CU-ICAR work on a diverse mix of specialties including, engineering, design, and even psyschology as work to develop the next big thing in auto manufacturing.

and engineering, no one specialist can master them all.

And beyond that, there are benefits for the burgeoning automotive supply chains along the multistate I-85 corridor, and for the whole state.

According to the South Carolina Department of Commerce, the automotive industry has quadrupled in size in the state during the last 20 years, with more than 400 automotive-related companies and 66,000 people in the automotive workforce. BMW, with its North American manufacturing facility in the upstate, was the first, in 1994; Volvo, with its lowcountry plant that will produce only hybrid and electric vehicles, is the most recent.

“We see ICAR as one of the top resources we have for recruiting new companies,” says John Lummus, president and CEO of the Upstate SC Alliance, which promotes the region from its base in Greenville. “It’s a huge advantage for economic development.”

Tackling Trends And Challenges As with any academic environment – an “innovation ecosystem,” as they say – the 250-acre, $250 million CUICAR campus is a complicated place.

Don’t look for Dabo Swinney and the football stadium; they’re about 30 minutes west at the main Clemson campus. Top-level ICAR faculty include four endowed chairs and an endowed professorship. About 1,300 people are on site during the academic year. More than 20 companies also maintain a presence on campus.

From the soundproof port where students listen for the slightest potential road noise, to the areas where Deep Orange teams do their machining and assembly, everything is state-ofthe-art.

Just as important to CU-ICAR students is their multidisciplinary approach, according to Paredis.

44 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

No. 50 Team Panoz Racing Panoz Avezzano GT driven

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 45

SP OT LI GH T

For the Deep Orange projects, a team of 20 to 40 students must tackle a challenge that’s about more than design and engineering. They think about who’d want to drive the vehicle and how it would be marketed. They work out testing scenarios.

Societal and transportation trends must be considered too, Paredis says.

For example: How should a vehicle that’s used in a ride-sharing system differ from a vehicle that just one person will drive?

In essence, Paredis says, the Deep Orange experience is like working for an automotive manufacturer and cycling through every process, in every department, from conception to completion of a vehicle.

“But if you tried to have a similar experience in industry, it would take a long time,” he says.

Moving Beyond Automotive?

Rigas took over leadership of CU-ICAR with an eclectic resume in business and academia – he’s not just an auto industry guy. As South Carolina revels in its automotive resources, but looks to broaden its industrial base, there’s been speculation CU-ICAR might be headed

down a different road, less focused on automotive issues. Clemson’s new Center for Advanced Manufacturing certainly is aiming at broader targets.

But Rigas sees outreach to other industries not as a different road, but a parallel path that will benefit everyone.

“A lot of the technologies that are important to the auto industry are also important to other industries as well,” he says.

He mentioned Samsung, which announced plans for a $380 million home appliance manufacturing plant in Newberry in June 2017 and already is producing washing machines with technology that includes robotics.

“They’re manufacturing some sophisticated, high-technology appliances,” Rigas says. “That’s what the consumer wants. And the challenges are similar (to automotive) as far as manufacturing.”

Automotive manufacturers are interested in forging connections with other industries, Rigas says. Clemson students also benefit from interactions with other industries, he says, as they learn how to tackle different types of challenges.

Gregory Wheeler isn’t one of the ICAR grads snapped up by industry

46 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

— he earned his master’s and returned to his job as an Army infantry commander at Fort Benning, Georgia.

But who knows? Given the Army’s involvement in automotive research, he might transition eventually to work in that field.

Meanwhile, he takes pride in his leadership role on Deep Orange 9, the rally car project. He earned a mechanical engineering degree at West Point, and grew up working on cars with his dad in central Illinois. But for many on the rally car team, hands-on experience was something new.

“A lot of them had never used tools before,” says Wheeler, 35. “After the project, almost everyone could use tools and had physically built something on the car.”

Challenges in the rally car project included planning for rough terrain, competitive conditions and unusual safety measures. The multidisciplinary Deep Orange experience – considering marketing strategies, for instance – also should serve students well in automotive careers, Wheeler says.

“Engineers don’t always understand why designers want certain things in the car,” Wheeler says. “It helps to see the big picture.” n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 47

Faces of the Industry

In Constant Motion Ashley Frye strives to invest purpose in his life as head of the Tennessee Automotive Manufacturers Association TEXT BY: MICHELLE LOVE PHOTO: SARAH ABELL

W

illiam Ashley Frye is constantly moving. It’s a lifestyle (change) that he says was instilled in him by his father at a young age. “My dad was a principal purveyor of this way of thinking as I was growing up: ‘Always volunteer to take on an additional task because with every task comes the opportunity to learn something new or acquire a new skill’,” he says. “So I was always the one to jump up and say, ‘I’ll do it’!”

It’s that same mindset that Frye credits his success in life, including his 34-year career in the automotive industry. “Being raised in a military family and being in uniform myself for a handful of years certainly had what I would call a significant impact on the way I view things in terms of moving with a sense of purpose which is what you get beat into you when you’re in uniform. Whatever you do, you do it with a sense of purpose,” he says.

Frye’s love affair with cars began when as a small child, his father taught him the ins and outs of Volkswagens.

“My dad actually was a career pilot…

but during the second World War he was a machinist in the Navy,” he remembers. “So, he was a mechanically inclined kind of guy and he loved Volkswagens and he taught me how to do anything and everything involving Volkswagen Beetles.”

Frye was one of the first engineers hired by Nissan in 1981 when they were kicking off the construction of their plant in Smyrna, Tennessee. He had just left the Army and was looking for a career path that would allow him to be around cars. “When I left the Army and was picked up by Nissan it was like an unbelievable dream come true,” he says. Frye was with Nissan for 22 years and during that time period he was a member of the management team responsible for building the company’s plant in Mississippi.

Frye left Nissan in 2003 and went to Hyundai where he stayed for twelve years. There he served several positions including plant manager, vice president of production, and American COO. It was in 2015, however, that he decided to slow things down.

48 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

“When I hit 62, I decided that I’ve had a lot of fun in automotive manufacturing but it’s time to throttle down a little bit and leave manufacturing and simply retire, which is what I did,” Frye says. He placed a “one-year moratorium” on himself to avoid anything work related and to instead focus on life with his family. It was during that brief window, that the Tennessee Automotive Manufacturers Association (TAMA) came calling.

“While I was in my one-year retirement, TAMA decided they wanted a full-time guy to help support our membership and strengthen it, grow it here in Tennessee…they were looking for someone who had the experience and the skillset that I had developed over the years,” Frye recalls.

Frye became the executive director of TAMA in May 2016 and has since made it his mission, he says, to put everything he has into supporting the automotive industry and everyone involved.

“Since I joined the association it’s been my mission to reach out to our

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 49

F AC E S

O F

T H E

I NDUS TRY

Automotive manufacturing is the most significant economic impact factor here in Tennessee. I like to say to folks, ‘It’s not whiskey and it’s not country music. It is in fact automotive manufacturing. membership to determine what their needs consist of and really it’s just two basic ones. As you can imagine there’s a desire amongst people in the industry to be able to network so we set up some events to facilitate that. And another one is workforce development.”

With help from the University of Tennessee’s Center for Industrial Services and representatives from the Tennessee Economic and Community Development office, TAMA was able to start the Meet Your Match Tennessee networking initiative. “We had our first one last year and our second one this past May,” he says. “We brought together buyers of automotive parts along with the sellers of those parts,

so it’s a very specific and directed interaction between the two parties.

It has been so well received…that the University of Tennessee Institute of Public Service actually awarded the three groups the Collaborator of the Year Award which is a big deal within the University of Tennessee circle.”

Frye adds that people shouldn’t be surprised by TAMA’s prominent role in the automotive industry and any doubters should catch up. “Automotive manufacturing is the most significant economic impact factor here in Tennessee. I like to say to folks, ‘It’s not whiskey and it’s not country music. It is in fact automotive manufacturing,’ so whatever we can do to help support

50 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

and strengthen that industry I think it’s a wise use of everyone’s effort,” he says.

TAMA is in the middle of moving to Murfreesboro, Tennessee and Frye says their next point of focus is is the next Southern Automotive Conference, which is set to take place this month in Atlanta. As usual, Frye is at the forefront with his hands fully submerged in the project. He says he has no plans to slow down, either with TAMA or in his own personal life, for the foreseeable future.

“You’ve got to be engaged in something. Whether it’s work related or philanthropic activities related, you name it. Whatever you can engage in… just do something meaningful not only for yourself but for your community.

And that’s really what drives me as well: making a contribution to better the conditions of my family and the world I reside in and those who are around me. And I would say that’s also the driving influence behind TAMA.” n

Supplier Profile It’s a great feeling helping put so many people to work every day, knowing that you’re helping people achieve their goals —Alex Vazquez

ResourceMFG Supplying the automotive industry with a critical resource: talent. From entry-level trainable workers to highly-skilled engineers, ResourceMFG helps automotive manufacturers meet their staffing needs.

TEXT BY: HENRI HOLLIS / PHOTOS: RESOURCEMFG

I

n the highly-specialized world of automotive manufacturing, an efficient, reliable workforce is among the most valuable resources any company can have. ResourceMFG, the largest staffing provider to the OEM, Tier 1, 2 and 3 supply chain, helps some of the country’s biggest manufacturers

meet their daily workforce needs. The company currently has offices in more than 30 states.

A division of EmployBridge, ResourceMFG fills about 23,000 general manufacturing assignments every day, including 8,000 or so workers in the automotive space up and down the

52 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

supply chain. Yet they don’t just supply a large quantity of workers—they aim to provide a quality workforce, twice winning the Superior Performance in Production recognition from Toyota in recent years, which isthe highest level of recognition awarded by the OEM. ResourceMFG strives for a win-winwin arrangement with their automotive clients and employees, company leaders say. OEMs and Tier 1, 2 and 3 suppliers need an experienced, skilled and reliable workforce available on a just-in-time basis. When ResourceMFG fills all open assignments with trustworthy workers, those clients get exactly what they hoped for: efficiency in their workforce and along their supply chain, says Alex Vazquez, division vice president, adding that ResourceMFG’s employees, in turn, receive good jobs and the opportunity to advance in their careers.

It Starts With The Hiring Process.

A potential new employee is given a battery of proprietary assessments to determine his or her skill level. Each employee receives a designation: Trainable Workforce, Skilled Workforce or Highly-Skilled Workforce. Each level fills certain jobs along the supply chain, from assembly line workers to machinists to engineers.

Employees who set a goal of improving their skill-set and moving up the ladder are encouraged to do so and provided help according to Vazquez, who says the success of their large workforce stems from ResourceMFG’s investment in employees at an individual level.

“Our associates are never treated

There are plenty of temp agencies where anyone could walk in and get put to work the same day. We appreciate that our associates choose ResourceMFG, and we help them develop both work and life skills so they can achieve any goals.—Alex Vazquez like a number,” says Vazquez.

“Especially in this economy, there are plenty of temp agencies where anyone could walk in and get put to work the same day. We appreciate that our associates choose ResourceMFG, and we help them develop both work and life skills so they can achieve any goals they set for themselves.”

A key piece of the puzzle is EmployBridge’s Better WorkLife academy. In partnership with leading online training and education company Penn Foster, the Better WorkLife Academy helps EmployBridge workers, including those at ResourceMFG, close the skills gap widely seen in manufacturing. The flexible online courses are available for free to ResourceMFG employees, and they teach life skills in addition to industry-specific training and official manufacturing credentials.

Vazquez himself is a ResourceMFG success story. He began work with the company at the entry-level Trainable Workforce designation. His first job was driving a forklift. Now, he’s a VP at EmployBridge overseeing the entire ResourceMFG division.

“Since I started work here,” he says, “I feel like I’ve hardly worked a day.”

ResourceMFG serves the entire United States with 145 operating centers across 27 states. They recruit new talent through these operating centers as well as by partnering with technical and vocational schools, such as Gwinnett Tech just outside of Atlanta. With unemployment at historical lows, finding new workers is a challenge, but ResourceMFG specializes in locally recruiting workers, says Trent Waltz, vice president of Operations for parent company EmployBridge’s Strategic Partnership Group.

“Our top factor for finding new employees is referrals,” Waltz says.

“Then, our screening process really helps us retain those employees that we hire. It’s a lot easier to quit a job that you didn’t have to do anything to get.”

Waltz says that the proprietary EmployBridge screening tests used by ResourceMFG allow the company to validate potential employees’ skills,

which puts them in the best position for success.

“If you’re a highly-skilled worker with a specialized skill-set, you wouldn’t want to be placed in a lowskill job where you might be bored or not reach any of your goals,” says Waltz, adding that, “At the same time, even if a job pays more, a Trainable Associate with less experience would be in over their heads in some of the higher-skill positions. It’s about finding balance that works for the client and the employee.”

Working with many of the world’s largest automotive manufacturers, including OEMs like Toyota, Volkswagen and Mercedes-Benz, while simultaneously putting thousands of people to work in high-quality, wellpaid jobs, ResourceMFG is a company that truly does well by doing good, Vazquez says. “It’s a great feeling helping put so many people to work every day, knowing that you’re helping people achieve their goals,” he says. n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 53

Supplier Profile Ron Ballman, vice president of Operations for Shoals Extrusion.

Shoals Extrusion “Everybody cares.” How Shoals Extrusion sets itself apart from their competition TEXT BY: MICHELLE LOVE / PHOTO BY: DENNIS KEIM

F

or those in the automotive industry, the buzzing surrounding Shoals Extrusion, a small press aluminum extrusion company based out of Florence, Alabama, may be hard to ignore. In just three years the company has more than tripled its number of employees, formed strong bonds with their high caliber clients, and garnered a reputation for quality that would normally be associated with more senior businesses.

Ron Ballman, Shoals Extrusion’s vice president of Operations, says there’s no real secret to their success other than hard work and dedication.

Shoals Extrusion originally began in 2015 and provides raw materials that create structural support for vehicles such as buses, trailers, and motor homes. Ballman says 30 to 35 percent of their business is automotive related. “Everything we supply goes into something extremely large. There’s nothing really small about the products that we work with,” he says.

The company originally consisted of twelve people and dealt in distribution parts with non-automotive clients.

Ballman says it wasn’t until he joined in 2016 that the company began taking on more complex projects. “We’ve really been in the automotive market for about

54 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

two years and we’ve seen our market share grow significantly,” he says. “So in the matter of just a few years we’ve really made some traction in the market space and I think we’ve garnered a pretty good reputation as a high-quality supplier.”

Ballman says one of the ways the company has set itself apart from the competition is their attention to even the smallest detail. “There’s a lot of small components that go inside the walls and windows and door frames and those kind of things that a lot of people kind of take for granted…but you know, [it’s] very important that the structural integrity is intact. High quality aluminum is extremely important

and the dimensional integrity is [also] extremely important,” he says.

Shoals Extrusion also prides itself on their dedication to providing top quality production so clients can feel safe and secure. “We look at these school buses and these motor homes as it’s basically our responsibility to keep families safe…We take that very seriously,” Ballman says. “So that’s how we approach it is, ‘How do our products apply to keeping our families and our consumers and everyone else safe?’ and the only way we can control that is ensuring that the quality of our product is second to none.”

When the company began, according to Ballman, their supplierclient relationships were based less on quality and trust than on pricing and convenience. “The customer relationship had become more focused on, ‘What have you done for me lately when it comes to pricing?’ and not so much focused on, ‘What can we do to be big solution solvers for you and to be a good partner?’” Ballman says.

“I’m not as concerned as doing that [obsessing over pricing] for customers as I am just providing them with the product they want and allowing them to call my plant and talk to a live person who actually knows their account, understands what their needs are, and cares about the quality standards that we’ve put in place.”

Ballman adds that one of the reasons their client base has grown so rapidly in the company’s short lifespan is because they have agreed to work with individuals that other extrusion companies have rejected for being too complex. “We tell them [the clients] almost the same thing the other extruders do, except for the fact that we actually care enough to be able to work with them, give them what they want,” he says. “It’s going to cost them but they’re going to get exactly what they ask for.”

When it comes to maintaining customer relationships, Shoals Extrusion places an emphasis on honesty. “We’ve built a business model

The one thing that is so hard to find whether you have good employees or not, are people who care. And they come to work every day caring about what they do. — Ron Ballman based upon being honest with the customer,” Ballman explains. “Don’t make promises you can’t keep, and if you make a promise make sure that you deliver on it. As a result, we’ve made some really strong relationships and I’m really proud of the gap that we’re filling in the industry and I’m really proud of the hard work the people in this plant have done.”

In April 2018, Shoals Extrusion was honored with the Automotive Supplier of the Year award by the Alabama Automotive Manufacturers Association.

Ballman says he was “very humbled” by the award but also surprised due to other extrusion companies having longer running time. “When the committee came into the building to do an audit and [took] a look at why we were nominated and what our operation looked like, they were very impressed with the cleanliness and the organization and the neatness of the plant and the dedication of the employees and how happy they seem to be here,” he says.

Ballman credits the award to devoted employees. He even had T-shirts printed with the award on the back for the whole Shoals Extrusion team.

“This award, it was awarded to Shoals Extrusion, but…we couldn’t have gotten where we are on this journey without the hard work and dedication of the

people who are drinking the Kool-Aid here,” he says.

Overall, Shoals Extrusion and its employees have only one plan: to continue providing the best quality experience for everyone involved and that, Ballman says, starts and ends with a company’s employees. “You put a culture in place coming through the door where excellence is expected and…you know the one thing that is so hard to find whether you have good employees or not, are people who care.

And they [our employees] come to work every day caring about what they do,” he says.

For those still looking for the perfect extrusion company, Ballman wants them to remember what Shoals Extrusion cares about most. “One: we’re customer-centric. We care about our customers; two: we’re very quality minded. From the person who cleans the break room all the way down to the person packing the last stick of metal, everybody cares, everybody pays attention; and I think finally, from a competitive perspective, we can compete with anybody,” Ballman says. “Not only from a quality perspective but if they were to come into our plant they would be blown away by how clean and organized and functional it is, and they would see how happy and dedicated everyone who works here is.” n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 55

Kelly and Marty Hopkins

Supplier Profile

Direct Impact Taking on various roles, Mississippi-based Hopkins Advantage helps clients across the automotive industry focus on productivity TEXT BY: CARA D. CLARK / PHOTO BY: AMILE WILSON

W

hether an OEM or a supplier, a company’s core business needs to be the focus of the entire enterprise. The last things automotive companies need to worry about are side issues—for example, if the air conditioning is on the fritz, the copier needs new toner, or the trash cans need emptying.

That’s where Hopkins Advantage comes in. Specializing on providing a variety of services to the manufacturing

industry, the company occupies an unusual place in the automotive supply chain. It is one of those rarities in the industry, a certified Women’s Business Enterprise (WBE) and Woman-Owned Small Business (WOSB).

Kelly and Marty Hopkins, co-owners, run the company, which developed from their work together owning a construction company in 2012.

“We started performing small services for business in the area – a little

56 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

facility maintenance and housekeeping —and the services we provided began to expand,” Kelly Hopkins says. “We grew from there. In our first year of starting this, we grew to more than 200 employees in four states, providing services for OEMs and Tier Ones. In 2014, we formed Hopkins Advantage.”

The company’s growth was largely due to word of mouth. When Hopkins went to work for a facility in Mississippi, often those businesses had operations in other states where they wanted the same caliber of services. Soon, Hopkins had clients in Tennessee, Alabama and Georgia, simply from expanding into the larger organizations of facilities they served locally.

On to Automotive Automotive was a natural fit for Marty Hopkins, who spent more than 20 years in facility services in the automotive industry. Those were

relationship-building decades, creating connections with manufacturers such as Nissan, Kia and Honda.

Kelly Hopkins’s background in property management has taught her to bring together disparate elements and ensure they run smoothly.

“The automotive industry is a special group of people to say the least,” Kelly Hopkins says. “We’re appreciative of the opportunities that have been opened up to us as a womenowned business, and the auto industry is good about that. I love this business because it’s fast-paced and everchanging. You may buy a new car in 2018, and it may look like one from the previous year, but it’s probably not the same. Technology is always going faster than anyone can keep up with. It’s an exciting time to be in this industry.”

The company specializes in rack wash and repair, storeroom and inventory management, preventive maintenance programs and maintenance of mechanical systems and industrial systems. Over time the Hopkinses recognized other needs, including access control and parking lot management and janitorial services and grounds maintenance. These days, it’s a “you name it, they do it” attitude that keeps them poised for future expansion.

Marty Hopkins is vice president of the board of directors of the Mississippi Automotive Manufacturers Association, giving him a chance to network, and an opportunity to see the future of automotive in the state firsthand.

“It’s a good network of people, and I’m able to see a need for services to provide in the auto industry,” Marty Hopkins says. “There’s really not anybody else doing what we do. We supply indirect labor whether you are an OEM or a Tier 1 supplier. Instead of hiring five different contractors for five different roles, we go in and take over, allowing you to deal with just one contractor. The advantage is that we have the power to pull people for different roles and different resources.

It’s a big thing to our clients to deal

with only one person.”

The Hopkinses do not want to be categorized as a temp service. They’re in it for the long haul, which Kelly Hopkins says is the most benefit for the companies they serve.

“When we manage a process completely, like recycling for instance, you no longer have to worry about that work,” Kelly Hopkins says, adding that “We can handle anything that doesn’t deal with the production of the car.

“We take shipping racks, marshal those, load them off, separate them and peel the labels. We handle anything in the process.”

On the Road Along with building a reliable workforce, Kelly Hopkins says it’s a hands-on approach that contributes to the company’s success, though it often takes the couple on the road in different directions.

“Marty will be in Georgia, and I’m in Tennessee, and then we may cross paths in Alabama,” Kelly Hopkins says. “We stay on the road a good bit to be sure we are taking care of our clients by talking to onsite management and making sure our teams are accomplishing what we are there to do.”

Marty Hopkins says those visits to warehouses and plants throughout the Southeast are essential, not only to meet with managers, but to find out if there are other areas for the company to step into, allowing the client to focus on maximum productivity.

“Sometimes when we are on site, we see ways that we can add services and talk to the managers about that,” he says. “We may find that what we do for one client in Mississippi might need to be handled differently in Tennessee or that they need additional services. By

being on site, we can see how we can help them do what they are able to do and keep their focus on building the best product.”

Through indirect labor, Marty Hopkins says their company not only helps the clients save money, but also might catch some tasks that need to be done that can slip through the cracks in a busy workplace.

“They’re busy trying to get a car part out the door,” he explains. “We are able to perform jobs with less labor structure cost-wise. If they are paying a trained technician on the floor $16 an hour, we may be paying our people $14 and structuring valueadded jobs. The jobs that we handle for them are always cost-saving.”

Consider one example where costs can be cut: rack marshaling. With multiple sizes and configurations of racks making their way from one producer to the next for use in automotive Hopkins saw an opportunity. When OEMs return racks to suppliers, the maintenance is straightforward, but time consuming.

Hopkins Advantage examines the rack for damages, repairs it if necessary, sorts it according to size and usage, and returns it to service to begin the process over again.

“Through the indirect process of that part, we can structure the labor a little cheaper, which means instant savings for the client,” Marty Hopkins says. “There is a need for that in so many businesses. We’re looking to grow not only in automotive, but in other industries as well, and that’s a matter of getting the word out and letting people know who we are and educating them on the benefit of partnering with us. We can help a lot of people.” n

Instead of hiring five different contractors for five different roles, we go in and take over, allowing you to deal with just one contractor. The advantage is that we have the power to pull people for different roles and different resources. It’s a big thing to our clients to deal with only one person. —Marty Hopkins OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 57

INDUSTRY NEWS

Safety Would Take a Back Seat if Senate Passes Bill on Driverless Cars, Critics Say AImotive develops selfdriving techonolgy.

Consumer advocates are attacking a bill heading for a vote soon in the U.S. Senate that would clear legal obstacles for the deployment of driverless cars — a proposal that, critics say, lacks safeguards needed to protect the public and largely would let vehicle manufacturers regulate themselves.

TEXT BY: MYRON LEVIN, FAIRWARNING / PHOTOS BY: AIMOTIVE / WIKIMEDIA COMMONS

T

he measure, which is being pushed by auto and tech industry lobbyists, is called the AV START Act, standing for “American Vision for Safer Transportation through Advancement of Revolutionary Technologies.”

It would bar states and localities from setting safety rules for driverless cars, even though there are no federal regulations nor any requirement for regulations to be adopted in the future. Only nonbinding guidelines are in place. Over the next few years, the bill also would allow hundreds

of thousands of driverless vehicles to be exempt from existing federal standards for conventional cars and trucks, such as the requirements for steering wheels and pedals.

A similar measure, called the SELF DRIVE ACT, already has been approved by the U.S. House of Representatives.

Champions of driverless cars say they would improve mobility for disabled people and save lives by eliminating human errors that are the cause of most crashes. Yet consumer advocates and experts argue that driverless

58 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

transportation is still far from the bare minimum of being as safe as the flawed human drivers it is meant to replace.

The industry would be “in complete control when it comes to consumer safety in autonomous vehicles,” complained Michael Brooks, chief counsel for the nonprofit Center for Auto Safety, in a recent conference call with reporters. “As history has proven time and time over, automakers are incapable of prioritizing safety over profits,” Brooks says, “and the National Highway Traffic Safety Administration is an unwilling regulator.”

Citing a lack of cybersecurity protections, Mary “Missy” Cummings, a Duke University robotics professor, says that “anything electronic can be hacked.” Autonomous vehicle technology is “not mature by any stretch of the imagination,” Cummings says, yet “this legislation is willing to make guinea pigs out of the American public for what is fundamentally untested and unproven technology.”

In introducing the bill last fall, Senate Commerce Committee Chairman John Thune, R-S.D., and Sen. Gary Peters, D-Mich., cited the revolutionary impacts of driverless transportation and the need for the U.S. to maintain a leadership position.

“This legislation proposes common sense changes in law to keep pace with advances in self-driving technology,” Thune says in a press release.

“By playing a constructive role in the development of self-driving transportation systems, our government can help save lives, improve mobility for all Americans…and create new jobs.”

But some senators have called for stronger safeguards. In a March letter to Thune and Peters, five Senate Democrats — Dianne Feinstein (California), Richard Blumenthal (Connecticut), Kirsten Gillibrand (New York), Tom Udall (New Mexico) and Edward J. Markey (Massachusetts) — voiced concern that “the bill indefinitely preempts state and local regulations even if federal safety standards are never developed.”

It is essential that self-driving cars “be no more likely to crash than cars currently do, and should provide no less protection to occupants or pedestrians in the event of a crash,” the letter says.

A Thune spokesman told FairWarning the preemption language was needed “to ensure that a patchwork of state regulations does not potentially result in the need for 50 different versions of a vehicle to meet 50 different state standards.” As for the lack of federal safety standards, he says the new law ”will be a beginning and not the last word on statutory rules for self-driving vehicles.”

The issue has drawn throngs of lobbyists, with 187 companies, groups and agencies registering to lobby on self-driving vehicles from 2017 through June 30 of this year, according to data from the Center for Responsive Politics. Among them are insurance companies, municipalities and consumer organizations, but many are auto and tech companies and trade groups that have collectively invested billions of dollars in self-driving technology.

“Consumer groups really are being vastly outnumbered by the industry, says Craig Holman, a lobbyist for Public Citizen. “They are outgunning us in Congress.”

“I want to see self-driving cars on the streets,” Holman added. “It’s just I don’t want corporations to be in charge of regulating” self driving cars.

One industry group is the SelfDriving Coalition for Safer Streets, whose members include Ford, Volvo and Waymo, the autonomous vehicle unit of Google owner Alphabet, Inc. Leading the coalition is David L. Strickland, former head of the National Highway Traffic Safety Administration and now a partner in the law and lobbying firm Venable LLP; and Chan Lieu, also a former senior official at NHTSA. In 2017 and the first half of this year, the coalition reported paying Venable $480,000 for lobbying, according to the Center for Responsive Politics. Strickland did not respond to emails or a call.

Proponents of self-driving cars often mention a NHTSA estimate that 94 percent of vehicle crashes result from human errors such as speeding, fatigue and drunk or distracted driving — hence the need, they say, to take humans out of the equation. Some of the same auto and tech firms making that argument have contributed over the years to distracted driving by developing and selling wireless systems that tempt drivers to talk, text and engage in social media while behind the wheel.

Last October, when NHTSA reported that traffic deaths in 2016 exceeded 37,000, the Self-Driving Coalition immediately seized on the news.

“By removing humans from the driving process, self-driving vehicles offer an opportunity to significantly reduce the number of our loved ones killed and injured in crashes each year,” the coalition says in a press release. “It is critical that policymakers support the safety benefits of fully self-driving technology.” ​Still, a growing chorus of groups have urged caution, including the Insurance Institute for Highway Safety. In a recent report headlined “Reality Check,” the institute declared that “self-driving cars are supposed to be better at averting crashes than human drivers, but tests of prototype vehicles on public roads so far indicate that they aren’t always up to the task.…The early results underscore the fact that today’s systems aren’t robust substitutes for human drivers.”

The report cited several crashes linked to autonomous features in test and production vehicles, three of which resulted in fatalities.

In March, an Uber self-driving test vehicle struck and killed a pedestrian as she walked her bike across a street in Tempe, Arizona. The same month, the driver of a Tesla operating in ”Autopilot” mode was killed in a crash in Mountain View, California. And in May, 2016, another Tesla driver was killed when his car, also on “Autopilot,” crashed into the side of a tractor trailer in Williston, Florida.

Amid such disturbing headlines, public enthusiasm for driverless vehicles has waned.

A survey released last month by the research firm Cox Automotive found that only one in six respondents says they would feel comfortable riding in an autonomous vehicle without the option of taking control.

“People now have a deeper understanding of the complexities involved when creating a self-driving car,” says Karl Brauer, executive publisher of the Cox publications Autotrader and Kelley Blue Book.

“That has them reconsidering their comfort level when it comes to handing over control.”n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 59

REGIONAL REPORTS The Georgia Automotive Manufacturers Association, Inc. (GAMA) is a non-profit trade association which passionately promotes the interests of Georgia’s automotive and ground transportation industry. GAMA is a community of businesses with common interests and goals which provides a highly interactive forum to help members achieve the following: • continual improvement in their businesses • higher levels of innovation, quality, and profitability

• professional success through unique educational opportunities • successful networking among customers and peers

5TH ANNUAL GOLF TOURNAMENT

O cto b e r 3 - 5

SouthernAutoCon.Com P RE SE NTE D BY

gama

GAMA’s primary focus this year is on hosting the Southern Automotive Conference (SAC) on October 3-5, 2018. The event is being held at the Cobb-Galleria Convention Centre in Atlanta, Georgia (see photo). The GAMA Teams are continuing to move full speed ahead to have this be a spectacular event, delivering extraordinary value for all who attend, exhibit, and/or sponsor.

Highlights include: The logo and theme for this year’s event “Forward Momentum are intended to capture the growing importance and strength of the SAC to our region and the automotive industry worldwide.

The website for SAC 2018 is www.SouthernAutoCon. com. The website has been accepting registrations and signing up exhibitors at a good pace. The SAC sold out last year as to both attendee registrations and exhibitor spots.

We recommend you sign up early, to avoid missing out.

Speakers announced so far include: • Raj Batra – President, Digital Factory Division, Siemens • Stuart Countess – Chief Administrative Officer, KIA/ KMMG • Governor Nathan Deal - Governor, State of Georgia • Linda Hasenfratz – CEO, Linamar Corporation • Dr. Hagen Radowski – President & CEO, MHP Americas – A Porsche Company • Gary Silberg – National Sector Lead Partner for the Automotive Industry, KPMG • Jonathan Smoke – Chief Economist, Cox Automotive • John Warniak – Vice President, Vehicle Technology, SEMA • Davis Woodruff - President, Management Methods with many more to come.

At l a n ta , GA PMT Publishing, with their experienced SAC Team including Sheila Wardy, Molly Lipski, and Walker Sorrell, is the Event Planner and Promoter for this year’s SAC. They are doing a fantastic job.

Sponsorships are very important to the success of events like this, and the GAMA Sponsorship Team consisting of David Eyes, Julio Gonzalez, Walter Griggs, Terry Seese, and Mike Stonecipher, are energized, organized, and are meeting regularly to help ensure the success of this event. GAMA is most grateful for their assistance.

GAMA welcomes your support in helping obtain Sponsors by spreading the word at your company or organization. Sheila Wardy is the Director of Sponsorships for the SAC, and is reachable at swardy@pmtpublishing. com, or by phone at 205-802-6363 x108.

This will be the 11th year for the SAC, and one of the reasons for its continuing success is the support of the other regional association executives – from AAMA, MAMA, TAMA, KAIA, SCAC, and SAWF. The invitation-only VIP Reception scheduled for Wednesday, October 3, 2018, is expected to feature buyers from nine OEMs and six Tier 1 suppliers, who will be there to meet prospective customers. Invitations are extended only to registered Sponsors and Exhibitors, so sign up now. Members of the Boards of our regional associations will also be in attendance.

This year’s event is expected to host several International Pavilions. This adds international resources and opportunities to the event, and builds on the success of the JETRO International Pavilion from 2017. GAMA welcomes any introductions you can make in this area.

For further information, please contact Rick Walker, GAMA President, at rwalker@GAMA-Georgia.org or 770-314-9040 60 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

REGIONAL REPORTS

Alabama Automotive Manufacturers Association

AAMA’S MISSION is to promote growth and continuous improvement of automotive manufacturing in Alabama.

ALAUTOINDUSTRY.ORG

GET MORE MILEAGE WITH AAMA MEMBERSHIP! AAMA HELPS YOU BE COMPETITIVE. Work with statewide partners who represent your interests to further job creation and develop a promanufacturing economy.

AAMA HELPS YOU CONNECT.

Get connected to the people, programs, information and resources that can help you improve your business and grow your team.

AAMA KEEPS YOU INFORMED.

AAMA delivers events, newsletters and training opportunities focused on the issues that have the greatest impact to Alabama’s automotive manufacturers and suppliers. Gain access to the biannual survey of the automotive industry in Alabama, the AAMA “members-only” website, and Southern Automotive Alliance magazine.

AAMA SAVES YOU MONEY.

AAMA’s efforts focus on eliminating unnecessary cost burdens while low cost training programs are offered to AAMA members through ATN, AIDT, Alabama Community Colleges and Universities. You can also request a plant assessment or training program within your facility.

AAMA GIVES BACK. AAMA awards

scholarships annually to students enrolled in automotive manufacturing programs at Alabama’s two-year colleges. Members can participate in the AAMA Supplier of the Year Award with our partner, the Business Council of Alabama (BCA).

AAMA LETS YOU ENGAGE.

AAMA’s Corporate Partners and Board Members are among Alabama’s most respected thought-leaders for our industry. Active AAMA members can work alongside these automotive icons to make a difference for our state and industry.

BENEFITS OF AAMA MEMBERSHIP INCLUDE: • Business networking opportunities • Leadership opportunities • Sharing of manufacturing best practices • Information on issues impacting the industry • Information on advances in technology and continuous improvement • Access to internet database of Alabama automotive-related companies • Listing on AAMA website • Members Directory • Promotional opportunities for company news • Factory floor assessments (participating companies are eligible for AAMA Supplier of the Year Award) • Member discounts for training • Membership to AIAG • Membership to BCA • Invitation to annual Appreciation Dinner

Join AAMA today! Start now taking part in Alabama’s dynamic automotive manufacturing association. If you are interested in learning more about AAMA and how you can help advance Alabama’s automotive industry, please visit ALAutoIndustry.org.

Contact: Lynsey Delane | 256.824.6407 Ron Davis | 205.657.5101 OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 61

REYour key to Mississippi’s automotive industry!

Get Connected!

Follow us on social media to say up-todate on Mississippi’s automotive industry!

Congratulations to our 2018 – 2019 MAMA Scholarship Recipients!

Growing a strong automotive workforce is essential to the health of the automotive industry in our state. Providing support and opportunity is one way MAMA and its members can secure its future workforce. Since 2006, the Mississippi Automotive Manufacturers Association has awarded more than $250,000 in scholarships to students studying automotive-related fields at Mississippi’s community colleges and universities.

Mississippi State University Devin Byrd Calvin Michael Sellers University of Mississippi Jonathan Wolfe Walt Jacobs East Central Community College Jeremy Seibel Shelby Withers

East Mississippi Community College Chandler McCafferty Cameron Hitt Itawamba Community College Unshay Randle Kameron Ford

Hinds Community College John William Gunn Samuel James Gunn Holmes Community College Michael Gray NE Mississippi Community College Rudy Ferguson Jacob R. Mangum

Now accepting applications for the 2019-20 academic year!

Apply today: www.mamaonline.net/scholarships

Join MAMA today! If you are interested in learning more about MAMA and how you can help advance Mississippi’s automotive industry, please visit mamaonline.net.

Contact: Caley Dawkins – 601-750-5666 or msautomanufacturers@gmail.com 62 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

-

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 63

REGIONAL REPORTS

SAC 2019 s o u t h e r n au tom otive conf er ence

Sept e m b e r 25 – 27, 2019 SAVE THE DATE • RESERVE YOUR SPACE • SECURE A SPONSORSHIP Visit the TAMA booth right now at SAC 2018 and get plugged in to an electric SAC 2019 in the Music City.

www.southernautocon.com/SAC2019 64 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 65

KUDOS

Building More than Cars Nissan workers help Habitat for Humanity construct houses in Mississippi

BY NICK PATTERSON / GRAPHICS COURTESY OF NISSAN

I

t has become the custom of some car manufacturers to find ways to give back to the communities in which their factories are located. For some it takes the form of disaster relief or local clean up efforts, for others scholarships, or school supply giveaways.

For several years, volunteers from Nissan’s Canton Assembly Plant have worked not only to build cars, but to build houses. They’ve done that working with a well known charity, Habitat for Humanity Mississippi Capital Area, an organization involved

in building or renovating homes for more than 600 families in Hinds, Madison, and Rankin counties.

This year the team members from Nissan built their 11th house. Almost 100 team members participated in the two-month project, as reported on the Nissan website.

“The employees of Nissan Canton look forward to the Habitat build each year,” Philip Calhoun, senior director, Manufacturing Operations, Nissan Canton Assembly Plant says. “We are afforded the opportunity to take our

66 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

expertise of building great vehicles to building great homes for local Mississippi families.”

Mother of two Tyran Trotter is the homeowner of the Nissan Habitat build for 2018. She, like other recipients of Habitat assistance, put in hours of “sweat equity” assisting with the work, as well as financial training and DIY classes to help her take care of her new home. “As they build new homes, they also build stronger neighborhoods with engaged residents and return abandoned properties to the city tax

rolls,” according to the organization’s website. “HFHMCA homeowners buy their homes through zero-interest mortgage payments over 30 years.”

“The nearly decade-long partnership between HFHMCA and Nissan has provided numerous affordable homes for the working poor,” says Merrill McKewen, executive director of HFHMCA. “The work of the Nissan employees has created such a positive impact in our community. We look forward to continuing this partnership and building more homes.”

Nissan’s Canton plant is in line with similar community outreach from the company as a whole. Nissan North America has logged nearly 100,000 volunteer hours and contributed more than $15 million in 13 different communities through Habitat. The company connection to Habitat began after Hurricanes Katrina and Rita, when Nissan donated 50 trucks and sent employees to help rebuild homes.

Since 1986, HFHMCA has built over 630 houses in partnership with lowincome families in need, according to the organization’s website. The local Habitat branch has covered Hinds, Rankin and Madison counties for the past 30 years, where it has also “developed infrastructure for and rebuilt 2 previously abandoned subdivisions, demolished over 170 condemned houses, rehabilitated/weatherized over 155 more homes,” for needy families. n OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 67

CAREER NOTES Volkswagen of America, Inc. (VWoA) today announced the appointment of AMANDA PLECAS as Manager of Communications for Volkswagen Chattanooga. In this role, Plecas will lead external and internal communications for the factory and will report into the Volkswagen of America communications department.

Previous to this role, Plecas managed the team and led creative services for the Chattanooga based Waterhouse Public Relations Agency. Prior to Waterhouse, Plecas was the Communications and Government Relations Manager for Wacker Polysilicon North America.

Outside of Volkswagen, Amanda will continue her work as a part-time faculty member at Lee University in Cleveland, Tennessee, where she teaches public relations writing and crisis communication courses.

A Chattanooga native, Plecas graduated from Leadership Chattanooga and earned a Master’s Degree in rhetoric and composition and an undergraduate degree in writing from the University of Tennessee. Plecas also holds an Accreditation in Public Relations, is a certified Public Information Officer and certified in Organizational Compliance/ Ethics. Plecas’s success in strategic communications was recognized by PR News in 2016, where she was a topfive global finalist for Corporate PR Professional of the Year.

Surgere has announced the appointment of automotive supply chain veteran DANA MCBRIEN as Guiding Architect for the AutoSphere, the company’s digital supply chain platform now uniting five major automakers and a growing number of their suppliers. McBrien has more than 34 years’ experience, most recently retiring as head of the Supply Chain and Transportation teams for Honda North America. He will provide the growing ecosystem’s membership with

focused executive-level leadership, ongoing coordination with the Automotive Industry Action Group (AIAG), collaboration with European organizations and participants, and supporting the expansion and extension of the AutoSphere into deeper areas of the supply chain as defined by the membership, such as Finished Vehicles and Service Parts.

Toyota Financial services announced in August that President and CEO MIKE GROFF would retire from that position, as well as roles on the company board of directors, and CEO of the America’s Region of Toyota Financial Services International Corporation. He remains executive advisor to Toyota Financial services through Nov. 16, 2018.

His successor is MARK TEMPLIN. Templin first joined Toyota in 1990 and has served as chairman of the Board of Directors of Toyota Motor Credit Corporation (TMCC) since May 2016. He also serves as director, president and COO of TFSIC and director and Group CEO of Toyota Financial Services Corporation. From April 2013 to December 2017, Templin also served as managing officer of Toyota Motor Corporation. Templin previously served as Group vice president and general manager of the Lexus Division for TMS, overseeing all aspects of Lexus’ U.S. automotive operations, including sales and marketing, retail development, customer satisfaction, and product planning. His responsibilities included coordinating sales activities, dealer relations, parts and service operations, and marketing operations of four regional offices around the country.

General Motors named EVERETT EISSENSTAT as senior vice president, Global Public Policy,

68 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

effective immediately.

Eissenstat will report to GM Chairman and CEO Mary Barra.

Eissenstat, 55, had been with the White House as Deputy Assistant to the President for International Economic Affairs and Deputy Director of the National Economic Council from June 2017 to July 2018. Jointly appointed to the National Security Council and the National Economic Council, Eissenstat led the White House international economic team responsible for the development and coordination of policies related to international energy, international trade and development finance institutions.

Prior to his role at the White House, Eissenstat served as chief international trade counsel for the Senate Finance Committee from 20112017, where he managed international economic issues. Prior to that position, he was with the United States Trade Representative (USTR) as Assistant U.S. Trade Representative for the Americas from 2006-2011, where he negotiated and implemented international trade agreements with foreign governments and partnered with members of Congress on trade legislation.

In June 2018, JOHN ABSMEIER joined Lear as its chief technology officer. Absmeier was formerly senior vice president and general manager of the ADAS/Autonomous business unit at Harman International and vice president of Smart Machines at Samsung Electronics, leading Samsung’s acquisition of Harman. Before 2015, Absmeier worked at Delphi, where he held various senior level positions over a 19-yea r career including as founder and managing director of Delphi Labs Silicon Valley andjAutonomous Driving as well as business director for Electronic Controls and Electrification in Asia-Pacific for six years. He held several roles at Delphi in the areas of hybrid and electric vehicles, fuel cells and telematics. n

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 69

I N D U S T R Y I N D I C AT O R S

AUTOMAKER FACILITIES: MOTOR VEHICLES & EQUIPMENT No surprise that Michigan still has the most, but do you know how many people are working in how many automotive related facilities in Southern states?

346

27,277 42,842 539

Source: Source: AutoAlliance.org, compiled from company reports

50,428

9,025

24,437

193

406

1,752

27,277

30,265

346

664

MI C HI GA N FACILITIES: 2,454 EMPLOYEES: 394,984

Southeast Auto Stocks Company/Security

Headquarters

S.E. U.S.

Ticker

Exchange

Closing Price 8/31/2018

Closing Price 8/31/2017

Stock Price Growth

BMW (Bayerische Motoren Werke AG ADR)

Munchen, Germany

SC

BMWYY

OTC

20.55

12.3

h 67.07

Ford Motor Co.

Dearborn, Michigan

KY

F

NYSE

9.48

11.03

i 14.05

General Motors Co.

Detroit, Michigan

KY, TN, TX

GM

NYSE

36.05

36.54

i 1.34

Honda Motor Co. Ltd.

Minato, Tokyo, Japan

AL, SC

HMC

NYSE

29.63

28.1

h 5.44

Hyundai Motor Co. Ltd.

Seoul, South Korea

AL

HYMLF

OTC

120

120

0.00

Kia Motors Corp.

Seoul, South Korea

GA

KIMTF

OTC

30.3

31.25

i 3.04

Mazda Motor Corp.

Hiroshima, Japan

AL

MZDAF

OTC

11.8964

14.75

i 19.35

Mercedes-Benz (Daimler AG)

Stuttgart, Germany

AL, GA, SC

DDAIF

OTC

64.6499

72.89

i 11.30

Mitsubishi Motors Corp.

Minato, Tokyo, Japan

KY

MMTOF

OTC

7.15

7.28

i 1.79

Nissan Motor Co. Ltd.

Nishi-ku, Yokohama, Japan

MS, TN

NSANF

OTC

9.45

9.9725

i 5.24

Porsche Automobile Pfd.

Stuttgart, Germany

GA

POAHF

OTC

62.89

56.8

h 10.72

Toyota Motor Corp. Ltd. Ord.

Toyota, Aichi, Japan

AL, KY, MS, TX

TM

NYSE

124.08

112.98

h 9.82

Volkswagen Ag Ord.

Wolfsburg, Germany

TN

VLKAF

OTC

160.64

155.65

i 3.21

Volvo AB ADR

Gothenburg, Sweden

SC

VLVLY

OTC

17.21

17.03

i 1.06

70 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 71

BY T H E N U M B E R S

PREVIOUS

19,000 SQ. FT.

Size of expansion at JTKET North America in Greenville, SC thestate.com

1909 M EC HA TR ON IC S

Year when the first automobile was assembled in Georgia. georgiatrend.com

Associate degree available at some Tennessee high schools which allows students to enter the auto industry upon graduating. tennesseean.com

20

MONTHS Time frame within which all of Alabama’s major auto manufacturers have announced expansions. al.com

20,220 Number of new jobs within the automotive industry in South Carolina between 2011 and 2017. sccommerce.com

$3.5

MILLION Investment being made by auto industry supplier DENSO Air Systems Michigan to double the size of its Christian County, KY facility. southernautocorridor.com

72 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

$175

MILLION

43,000 Investment by automotive supplier Flex-N-Gate Corp. to expand into a new plant in Grand Prairie, TX autonews.com

6

Number of vehicle production projects announced in Alabama since March of 2017. al.com

$170

MILLION Amount being invested by Nashvillebased Nissan North America to upgrade its plants in Mississippi and Tennesse. southernautocorridor.com

Index AAMA................................................17, 55, 61,76 ABL-Technic..................................................... 35 AIAG.................................................................... 3 Airbus............................................................... 13 Aisin Seiki......................................................... 15 Alabama Tech Network.................................... 9 Alliance of Automobile Manufacturers........ 28 Allie Kelly.............................................................32,33,34 Amanda Plecas............................................................. 68 Andrew Wheeler.....................................................28,29 Apple...........................................................18, 19 Assembly Tool................................................. 37 Association of Global Automakers............... 28 Atlas RFID......................................................... 14 Auto Alliance................................................... 24 Bernard Schroer.......................................................... 76 Bernhard Mattes.......................................................... 17 Blue Origin....................................................... 17 BMW.................................14,17,18, 24,28, 42, 44 Bob Woods.........................................................36,37,38 Boeing............................................................... 13 British Columbia Automobile Association... 14 Carla Bailo.................................................................29,30 Cartivator......................................................... 13 CAVS.................................................................... 8 Center For Auto Safety................................... 58 Center For Automotive Research.24,25,26, 29,30 Center for Responsive Politics...................... 59 Chris Paredis................................................ 42,43,44,46 Chrysler............................................................ 15 Clemson University........... 40,41,42,43,44,45,46 Competitive Enterprise Institute.................. 17 Corinne Hodges........................................................... 34 CU-ICAR.............................. 40,41,42,43,44,45,46 Daimler...................................................15,17, 18 Dana McBrien............................................................... 68 David Fernades............................................................ 15 DenhamBlythe................................................ 49 Denso........................................................... 15,29 Donald Trump........................................................12, 15 Doug Jones.................................................................... 15 Dynametal....................................................... 49 Dynetics........................................................... 16 East Texas Advanced Manufacturing Academy.......................................................... 16 EFC...................................................................... 4 EmployBridge............................................. 52,53 Environmental Protection Agency................ 28 Everett Eissentat.......................................................... 68 Faurecia........................................................... 12 Fiat Chrysler.................................................... 24 Flex-N-Gate...................................................... 14 Ford.................................................... 16,17,24,59 GAMA................................................................ 60 Geely Holding.................................................. 20

General Motors.....................................24, 42,76 Genesis............................................................. 18 Georgia Ports................................................... 68 Gerald McDermott...........................................................

German Association of the Automotive Industry............................................................ 17 Habitat for Humanity................................ 66.67 Hayley Barbour............................................... 27 Hodges................................................................ 5 Honda...................................... 15,25,28,42,57,76 Hopkins Advantage................................... 56,57 Hyundai....................................... 15, 18,25,28,76 IHSE................................................................... 23 Infiniti............................................................... 76 Innovative Research....................................... 14 J.F.Drake State Community and Technical College.............................................................. 17 Jaguar..........................................................12, 24 Jeff Moore...........................................................20,21,22 JMF.................................................................... 31 John Absmeier.............................................................. 68 KAIA.................................................................. 63 Keeton.............................................................. 71 Kelly Hopkins...........................................................56,57 Kia...........................................................25, 34,57 Kristin Dziczek....................................... 24,25,26 Land Rover..................................................12, 24 Lawson State..................................................... 2 Leadec.............................................................. 11 Lexus........................................................... 14,16 Lindsay Chappell.....................................................76,77 Longview Economic Development Corp....... 16 Lynrd Skynrd................................................... 14 Macquarie Capital Securities......................... 18 MAMA.......................................................... 62,78 Mark Templin................................................................ 68 Marty Hopkins.........................................................56,57 Mazda.......................................................... 15,24 Mazda Toyota Manufacturing USA.......... 14,25 MBUSI.......................................................... 14,29 McAbee............................................................. 11 Mercedes-Benz......14,15, 17, 18, 24,25,28,29,76 Mike Goff....................................................................... 68 Minact.............................................................. 75 Mississippi Development Authority............. 13 Mitsubishi........................................................ 24 Morris South.................................................... 75 Motion Industries........................................... 15 Motor Equipment Manufacturers Association...................................................... 30 NAFTA..................................................... 24,25,26 NAOS................................................................. 31 NEC................................................................... 13 Nick Rigas...........................................................41,43, 46 Nissan.........................12, 18, 25, 29,48,57, 66,76

74 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

NSF...................................................................... 6 Omnex.............................................................. 51 Onin.................................................................. 77 Oracle Construction and Engineering.......... 14 Phil Bryant..................................................................... 13 PLEX.................................................................. 37 Porsche........................................................ 18,24 Public Citizen................................................... 59 Ray Anderson....................................................32,33,34 Reich................................................................. 35 ResourceMFG.............................................. 52,53 Richard Shelby.............................................................. 15 Ron Ballman.............................................................54,55 Ron Davis....................................................................... 17 Samsung........................................................... 46 Savannah Economic Development Authority.12 SCAC.................................................................. 65 Self-Driving Coalition for Safer Streets........ 59 Shoals Extrusion.........................................54, 55 SMW.................................................................. 13 Southern Automotive Conference...... 10,76,77 Southwest Tennessee Community College.. 13 Staubli.............................................................. 71 Stephanie Mangini..................................................20,22 Stuart C. Countess....................................................... 34 Superior Paving............................................... 19 Susan Elkington............................................................ 16 Sustained Quality........................................... 71 Systems.......................................................................... 37 Tallagega Superspeedway............................. 18 TAMA...................................................... 48,50,64 Tennesse College of Applied Technology Memphis.......................................................... 13 Tennessee Economic and Community Development................................................... 50 Tesla.......................................................16, 19,59 Texas State Technical College....................... 16 The Jetsons...................................................... 13 The Ray................................................... 32,33,34 The Rhodium Group........................................ 30 Toyota............13, 15, 16, 17,24, 25, 28,29, 42 80 UA College of Continuing Studies................. 73 Uber.................................................................. 13 University of South Carolina.................... 25,26 University of Tennessee................................. 50 University of Texas Arlington.............. 36,37,38 Upstate SC Alliance......................................... 44 UTZ.................................................................... 67 Vascor............................................................... 47 Volkswagen....................................... 13,24,25,48 Volvo........................................ 20,21,22,24,25,59 W. Ashley Frye........................................................48, 50 Waymo........................................................ 19,59 Webasto........................................................... 12 Worthwhile...................................................... 79

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 75

VINTAGE

The First Southern Automotive Conference

After a decade the Southern Automotive Conference is a powerhouse, but it came from small beginnings TEXT BY: NICK PATTERSON

A

ttendees at this year’s Southern Automotive Conference are seeing the fruition of an effort that began in a far humbler fashion with a two-day event, Nov. 6 and 7, 2008. About 400 people attended that first SAC, which was organized by just three automotive associations – and which was flying against economic indicators which seemed elsewhere to bode ill for the car making industry.

“It spoke a great deal to the spirit of the southern auto industry,” recalls Lindsay Chappell, then the Mid-South Bureau Chief for Automotive News, where he now serves as news editor

and reports on Nissan and Infiniti.

Chappell says he found that first SAC event to be remarkable precisely because of what was going on around the country a decade ago – the run-up to a major recession.

“You have to put it in context of where the industry was at that moment and where the economy was – that every day’s newspapers held some sort of alarming economic news; companies in financial jeopardy and businesses laying off a thousand workers…and this is before the crash, right, this is leading up to the crash,” Chappell says. “People were cancelling programs; people were putting projects on ice. That

76 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

was the mood of 2007 and 2008. And nonetheless, this conference was really bullish….

“The southern auto industry, as we saw, was hardly immune to the crash that came over the 24 months that would follow. But it was somewhat outside the epicenter of the economic troubles that were going on,” Chappell says, noting that in this region, “there were still many people who were bullish in their attitude and who were confident about the future – not erroneously so, but as it turns out very wisely so.”

That spirit, he says, meant that for the automotive associations in Alabama, Mississippi and Tennessee, which sponsored the SAC, this was a time for vision. “To me it was sort of a magical moment that in the midst of all the alarms and cheers, that the southern auto industry wanted to press ahead and bring people together and talk about ideas looking forward and solutions looking forward and opportunities looking forward.”

At that first SAC, held in Alabama at the Huntsville Marriott, there were workshops on lean manufacturing, avoiding liability for labor and employment claims under state and federal law, comments about the growth of the automotive sector in Tennessee, Mississippi and Alabama from state development leaders, and an OEM panel, moderated by Chappell, featuring executives from Nissan, Hyundai, General Motors, Honda and Mercedes-Benz.

Dr. Bernard Schroer, one of the founders of the Alabama Automotive Manufacturers Association, says the SAC was born from a series of meetings which involved members of the three AMAs that organized the conference.

“We kept talking back and forth and

OCTOBER/NOVEMBER 2018 / Southern Automotive Alliance 77

VIN T AGE

going to each other’s board meetings and to each other’s events. And we always talked about, ‘Well, we should get together and make this a little bit more of a formal structure,’” Schroer says. “We talked about that for years.”

After Toyota announced that it would site its eighth North American manufacturing plant in Mississippi, “the MAMA people began to come to our meetings and also to the Tennessee meetings, and they also were interested in trying to get together for some kind of an annual event,” Schroer says. “It just really evolved and I said, ‘Well, I’ll take the initiative and I’ll have the first one in Huntsville’ because Huntsville was easy to get to from both the Mississippi plant and the Tennessee plant.”

The idea, he recalls, was to bring the influential people who made up the boards of directors at the individual automotive associations together with economic development officials from each state. “What I tried to do was format a meeting that sort of highlighted what each of the boards were doing in the state, but more importantly, to bring in [at] the same time, the state economic development people and let them get a chance in a forum like this—with Mississippi, Tennessee and Alabama – to sort of share with all three states what each state was doing on economic development to support the auto industry,” Schroer says.

The SAC was also a way to get suppliers more involved in industry meetings and events, Schroer says. “I think way back we had even a system in place where the OEMs would bring in their buyers, and if you were a supplier or potential supplier, you could schedule a one-on-one meeting with those OEMs. What better way for a supplier or a potential supplier to ... start

doing business with industry [than] to go to a lot of these kinds of events.”

The secret history: before the SAC Even so, the SAC was not the first automotive conference highlighting the growing southern automotive sector.

Chappell says that distinction belongs to Automotive News.

“Automotive News started the idea of conferences in the southern auto industry back in the 1990s,” he says. “We decided to do an annual conference… and after a couple of years, the people of Alabama, the industry of Alabama, really put the arm on us to move it to Alabama for a year. And then we started rotating Alabama and Nashville, Alabama and Nashville. Other people in other states began to solicit us; Virginia wanted it, South Carolina wanted it.”

That conference, which Chappell remembers being branded as “New American Manufacturing,” was a smashing success, he says. “It was a delightful surprise to us that we thought we’d get some stalwart people who were interested in hard-hitting issues and we sold out. I mean, we packed people in from multiple states,” he says.

The reason for the name and the conference itself was that Automotive News saw the southern states differentiating themselves from the older northern-based, traditional automotive sector. “New American Manufacturers to us was a more accurate way of describing the nonDetroit Three, because up until we promoted that term, you either talked about the U.S. industry or the ‘transplants,’” Chappell says. “And the term ‘transplants’ was so shallow…was such a meek description of what was happening in places like Georgetown, Kentucky, and Smyrna, Tennessee, and Spartanburg, South Carolina.”

To me it was sort of a magical moment that in the midst of all the alarms and cheers, that the southern auto industry wanted to press ahead and bring people together and talk about ideas looking forward and solutions looking forward and opportunities looking forward. — Lindsay Chappell, Automotive News 78 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018

Chappell says the term “transplants” derived from a wave of American protectionism – efforts from about 1981 to prevent foreign car companies from sending so many imports to the U.S. market. The foreign companies, he says, “responded to that

by Honda building a factory in Ohio, and Toyota opening an assembly line in San Francisco, and Nissan building a factory in Smyrna, Tennessee.”

Those decisions were met with some scorn by many longtime automotive manufacturers who really didn’t grasp that what was going on in the south was not a fleeting, fly-by-night phenomenon, but a sea change in how and where cars would be built in America.

“And I went out of my way to go into factories and say, ‘No, you don’t get it.

This is bona fide auto making. They are making parts out of molten aluminum.

They’re doing everything that you are doing; this is bona-fide manufacturing.

These are not ‘transplants’; these are new American manufacturers’,” Chappell says.

Despite success, sometime around 2007, Automotive News decided to stop.

“We decided around this time ... that we were going to pull back, that we had other fish to fry and we had other types of conferences we needed to devote attention to,” Chappell says.

And that came as a disappointment to the audience in the south that we were going to not hold them anymore for the foreseeable future, and that gave rise to” a need for a new Southern conference, Chappell recalls.

“They filled that void that was already there. And I always thought that was remarkable…You don’t do a conference because you’re going to make a ton of money, you do a conference because you have an audience of people who really yearn for more,” Chappell says.

More is what attendees at this year’s SAC can expect: more vendors and exhibitors, more workshops, more suppliers, more OEMS, more states, more countries. “I’ve just been amazed,” Schroer says, “to watch it grow.” n

80 | Southern Automotive Alliance OCTOBER/NOVEMBER 2018