1

European Partnership

for the Anticipation of Change

in the Automotive Industry

6th Open Day: Regions & Cities in a Changing World

Lars Holmqvist, CEO CLEPA

8 October, Brussels

2

Facts about CLEPA

3000 member companies in total, representing 2500 SMEs

3 Million employees

300 billion Euro sales

3

13 National Trade Associations

82 Corporate Members

CLEPA, the European umbrella membership organisation for the global automotive

supply industry

4

MEMBER ASSOCIATIONS (National Associations, Associate, Affiliate)

ACMA (India)

ACS (Slovenia)

AFIA (Portugal)

AGORIA (Belgium)

ANFIA (Italy)

AUTIG (Denmark)

BWD Automotive

EUROBAT (Brussels)

EUROFORGE (Germany)

EUWA (Italy)

EWFA (Belgium)

EXIDE

FIEV (France)

ILEA (Luxembourg)

MAJOSZ (Hungary)

RAI (The Nederlands)

SAS (Sweden)

SERNAUTO (Spain)

SINDIPEÇAS (Brazil)

SMMT (United Kingdom)

SUPPLYON (Germany)

TAYSAD (Turkey)

TecCom

VDA (Germany)

ZVEI

5

CORPORATE MEMBERS

• Advanced Labels Technologies

• Aisin

• Akebono Brakes

• Arvin Meritor

• Autoliv

• Behr

• Bekaert

• BOS

• Bosal

• Bosch

• BPW

• Brembo

• Britax

• Brose Fahrzeugteile

• Cardone

• CIE Automotive

• CIMOS, Slovenia

• Continental AG

• Delphi

• Denso

• Dorel France

• Dunlop Tech

• Eberspächer

• Emitec

• Faurecia

• Federal-Mogul

• Fraunhofer

• Gates

• GE Lighting

• GKN

• Haldex

• Hayes – Lemmerz

• Hella

• Honeywell

• Honsel

• HUF

• Klarius

• Knorr-Bremse

• Koito

• Kongsberg Auto.

• Kostal

• Sanden of Europe

• SENSATA

• SKF

• Sogefi

• Takata Petri

• Trident Componets Group

• Tenneco

• ThyssenKrupp

• TMD Friction Services

• Tokai Rika

• Toyota-Boshoku Europe

• TRW

• Valeo

• VDI / VDE – IT

• Visteon

• WABCO

• Web BV

• Webasto

• Zanini Industries

• ZF Friedrichshafen

• ZF Trading

• JTEKT Europe

• Lear

• LuK

• Maflow

• Magneti Marelli

• Mahle

• Mann & Hummel

• Mark IV-Dayco

• Mira

• Mitsubishi Electric

• 3M

• MS Motor Service International

• NGK Spark Plug

• NISSENS A/S

• OSRAM

• Philips

• Pilkington

• Proliance NRF

• Reflexite

• Saint-Gobain Sekurit

6

Facts about the automotive suppliers 75% of the value of the car comes from suppliers

50% of the R and D spending from suppliers

A majority of patents are from suppliers

Some examples Electronic stability programmes

High pressure injection systems

Diesel particulate filters

Navigation systems

Stop / start

Hybrid systems

7

Automotive industry – major contributor to growth, employment and wealth

• Employment EU 25 – Automotive Suppliers: 4.8 million

• Out of Total Automotive employment: 12.1 million

• 1/3 of passenger cars produced in EU

• Total motor vehicles (worldwide) – Million units 73.1

• 27 % of worldwide MV production for EU 27

• €24 billion in R&D spending

• Tax revenue of vehicles €381bn = 3.5% of EU 15 GDPSource: ACEA 2007 figures

8

45

50

55

60

65

70

75

80

85

Mill

ions

Global Vehicle Sales

Asi

an T

iger

s C

rises

Sep

t 11

th

Cre

dit

Cru

nch

& >

$100

Oil

9

BRIC’s: Rock solid in 2008…but slowing in 2009

0

0,2

0,4

0,6

0,8

1

1,2

China India Russia Brazil

Mill

ions

Unit sales Growth Light VehiclesUnit sales Growth Light Vehicles

++1111

%%

+8%

+8%

+30%

+30%

+23%

+23%

+12%

+12%

+6%

+6%

20092009

20020099

200920092009200920082008 200820082008200820082008

+10%

+10%

+15%

+15%

10-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

AFRICA ASIA EAST

EUROPE

SOUTH

AMERICA

NORTH

AMERICA

WEST

EUROPE

2007

2008

2009

Short-term Light VehicleProduction Outlook

Regional Growth Trends 2007- 2008 - 2009 (Y/Y Growth Rate)

1111

Market downturns

Consumer demand drop – 3 contributory factors:

EU Environmental targets to be met: 130g CO2/km by 2012 (120g through technological measures + 10g complementary measures); 95 g CO2/km by 2020

Rising fuel prices

Current financial turmoil – failing banks; EU & Asian stock markets fallen sharply

Slump effects:

Heavy-duty, due to worsening credit conditions

Light-duty, due to job losses

1212

Lay-offs

Volvo Trucks AB is cutting more than 20% of its EU blue-collar staff

Volvo Car shedding 2,900 employees at its 3 plants in Belgium and Sweden

20% reduction in workforce of the vehicle makers means 1million fewer jobs in the EU for automotive suppliers

13

Growing challenges All-round soaring commodity prices – adversely affecting production:

– Electricity prices increased by approx. 60% since Jan 2005

– Hot wide strip steel risen by 41%, aluminium by 55% and copper by 174%, since beg 2005

– Steel – BHP Billiton agreed with Baosteel on an 97% increase from last year’s price of iron-ore, ALSO further consolidation (BHP Billiton/Rio Tinto)

14

Suppliers and VMs must stay on the right side of two huge coming shifts:

climate change, CO2 legislation, fuel prices change in the type of car to “cheap and cheerful” , more fuel efficient and smaller cars, increasing nos. from Asia

Defence mechanisms: concentrate on our premium segment lead in innovative technologies focus on developing new types of powertrains and

electronics dramatically increase R&D investment improve all-round skills retain training centres of excellence enhance education and competence

15

Industry in evolution• Over the past decades, the European automotive sector has

shifted from an industrial to a knowledge-based industry

• From being a low-skilled sector, the automotive industry is gradually changing to a more high-skilled labour force, with increased emphasis on innovation

• The growing demand for skilled workers is especially significant for the automotive suppliers, who have taken more responsibility in areas such as design and development, through continuing outsourcing

• Jobs that previously did not demand more than basic skills now require a certain level of literacy, numeracy, language and IT skills

16

Better Regulation

“CARS 21 - Competitive Automotive Regulatory Framework-

Mid-Term review”

Policy areas:

• Better Regulation and regulatory simplification• Internal market• Environmentally sustainable road transport• Road safety• Trade and overseas markets• Research and Development and intellectual property• Taxation, fiscal incentives and competition issues• Restructuring

17

Restructuring Forum

“European Partnership for the anticipation

of change in the automotive industry”

Endorsed on 17 October 2007 by the main stakeholders of the automotive industry:

ACEA, CLEPA, EMF and the European Institutions

is still open to new signatories

Member States, regional authorities, clusters

Contains a workprogramme of 14 actions to be implemented in the next 2/3 years

18

First step of the EPAC

New Project under the Progress programme: Anticipation of Change in the Automotive Industry

Partners: CLEPA and EMF

Main scope:Creation of an informal observatory of anticipation of change,

in order to create an early warning system to avoid the negative effects of restructuring

Duration: 12 Month 31.10.2008 - 30.10.2009

19

CLEPA/EMF goals:

• To understand the Automotive trends for 2020/2050;

• To increase competitiveness of the industry through a highly-skilled workforce;

• To establish HRM strategies;

• To develop regional strategies to support the automotive industry, taking into account in particular the needs of the supply chain;

• To have a predictable regulatory framework

20

Activities and Milestones

STUDY I: Scenarios and HRM strategies of anticipation of change within companies and regions

Three studies:

STUDY II: Skills levels and employability within companies, regions & sectors

STUDY III: Analysis of automotive regions

Two Dissemination Events:

• 23/24 April 2009

• 6/7 October 2009

21

Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

Five Deliverables in the contractual period: 31.10.2008 – 30.10.2009

2008

Kick-Off

Launch I Study 4.11.2008

Final Report

30/31.03.2009

2009

Progress Report

19.03.2009

Launch II Study

6.01.2009

Final report

30/31.06. 2009

Dissemination Event22/23.04.2009

Launch III Study 30/31.03.2009

Progress report

19.05.2009

Dissemination Event6/7.10.2009

Final Report

25.08.2009

22

Thank you foryour attention!

www.clepa.eu