Southern Automotive Alliance Magazine Winter 2020

WINTER 2020

Vince Green and students at Limestone County Career Technical Center

FOCUS ON EDUCATION

W O R KF O R C E: Mazda Toyota works with community colleges KUDOS:

VISION:

Toyota and Kia support scholars

An Auburn professor has a big idea for Southern colleges and carmakers

INDUSTRY OUTLOOK: Trade, Tariffs, and Sales challenge the industry

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WI NTE R

2020 volume 5 number 1

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Faces of the Industry 46 Lisa Harris Boyd After a personal tragedy she’s found a way to live a dream – helping others live theirs in far-flung locales 49 Sour Cream and Onin Staffing agency associates

let their hair down and pick up their instruments

Supplier Profile 53 IPAK Incorporated

Kentucky fabricator provides products to protect shipments of auto components

55 T.J. Snow Co Lisa Harris Boyd works behind the scenes at SAC, but out front at arranging dream getaways.

Features 20 EXECUTIVE Q&A: Canada’s Flavio Volpe talks about the industry’s future and why he loves cars

24 EXECUTIVE Q&A: Jennifer Springer brings Oklahoma to the table in the Southern auto sector 26 INDUSTRY OUTLOOK: Tariffs are only the

beginning of the issues automakers are facing

Chattanooga company focused on resistance welding and family

Departments 10 From the editor 12 Benchmarks/NewsHub 57 Career Notes 58 Regional Reports 64 Industry Indicators/Stocks 65 By the Numbers 66 Kudos 70 Index

36 EDUCATION: Kia used its Super Bowl add to draw attention to West Point, Georgia and outstanding students 38 WORKFORCE DEVELOPMENT: the Mazda-Toyota joint venture works with Alabama community colleges to offer opportunity

41 VISION: Should universities and OEMs focus on pushing student design or making processes better?

42 EXPERT VIEW: Here’s what DiCentral’s David

30 INDUSTRY OUTLOOK: Sluggish sales and

Eyes took away from the 2019 Southern Automotive Conference 51 Expert View Industry nonprofit helps OEMS band together on workplace health and safety

34 INDUSTRY NEWS: Are star safety ratings still

51 BEST PRACTICES: Industry nonprofit helps OEMS band together on workplace health and safety

shifting tastes push OEMS, suppliers and dealers to find ways to cope

reliable guides on vehicle safety under Trump?

ON THE COVER: Vince Green is leading Alabama community college students into the career path, an effort supported by Mazda-Toyota Manufacturing 8 | Southern Automotive Alliance | WINTER 2020

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From the Editor

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love the fact that you can Google the question: How many parts are in a car, and get an answer back from a Toyota kid-friendly FAQ:

A single car has about 30,000 parts, counting every part down to the smallest screws. Some of these parts are made at Toyota, but we also have lots of suppliers that make many of these parts. The 30,000 or so parts use different raw materials and different manufacturing processes.

The fact that cars have so many parts helps illustrate just how broad a community it takes to build a modern automobile. That, in turn, shows the number of potential stories there are for a magazine like Southern Automotive Alliance – just when it comes to articles about manufacturers and suppliers.

But beyond just the companies, the industry and the stories we write about it, are about the people. Each issue, and this one is no exception, we like to highlight some of the interesting folks behind the scenes who are often doing more than just their automotive-specific work. This issue we feature a travel agent and a rock band, for instance.

Even more broadly, with people being the most important moving parts in any automotive enterprise, the question that troubles executives is where exactly to get them. The fact is that industry experts have been lamenting for years that they just can’t get enough well-trained people fast enough, that old gear heads are heading for retirement, taking their institutional knowledge and leaving skills gaps, and that perfectly qualified people who would love to have a steady job that pays well, are bypassing automotive careers for other options.

While we always look at least one workforce development effort in SAAm, this issue, we’re going a bit further, and widening our scope to consider how manufacturers, state agencies, and schools are pursuing various initiatives around education.

For instance, our main workforce development story this time talks about how Mazda Toyota, building a muchheralded joint-venture plant in Huntsville, Alabama, is working with local state community colleges to create a pipeline to ensure a skilled workforce for that facility.

We have a feature on a special program by West Point-based Kia Motors Manufacturing Georgia to offer scholarships.

We wrap the issue giving Kudos to Toyota, which has been offering scholarships of up to $20,000 to collegebound students in youth development programs like Boys & Girls Clubs of America for more than a dozen years.

We also hear from an Auburn University engineering professor who believes that the best path forward for educational institutions and manufacturers in the South is to focus on the area where regional plants can make the biggest impact – improving the processes by which cars are built.

With a focus on education though, don’t think we took our eye off the ball when it comes to tariffs, sales, supplier profiles, and lots of interesting industry news. We even looked back at the most recent Southern Automotive Conference. We have fewer than 30,000 parts in the magazine, but we hope you’ll enjoy what we’ve come up with.

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

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PUBLISHER: Walker Sorrell EDITOR: Nicholas Patterson npatterson@pmtpublishing.com ART DIRECTOR: Rebecca Reeves WEB PRODUCER: Abby Parrott COPY EDITOR : Christine Gordon CONTRIBUTORS Dave Helms, Cara D. Clark, Bill Gerdes, Nancy Henderson, Carla Caldwell, Lawrence Elizabeth Knox, Michelle Love, Megan Boyle, Ash Wright, Joe DeSciose, David Green, Gail Allyn Short, Erica West, Chris McFadyen ADMINISTRATION: Sonia DeWerff CIRCULATION: Anita Miller ACCOUNTING: Keith Crabtree ADVERTISING SALES: Chandler Busby 205-802-6363 Ext. 103 cbusby@pmtpublishing.com INTEGRATED MEDIA & EVENTS Sheila Wardy swardy@pmtpublishing.com 3324 Independence Dr 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 quarterly by PMT Publishing Inc. Copyright 2020 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 3324 Independence Dr Birmingham, AL 35209. Phone (251) 473-6269 in Mobile or (205) 802-6363 in Birmingham.

FAX in Birmingham is (205) 802-6393 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.

WINTER 2020 | Southern Automotive Alliance 11

TEXT BY: DAVE HELMS, ERICA JOINER WEST AND CHRIS MCFADYEN

Industry Benchmarks

Volkswagen Expands Electric Vehicle Production in Tennessee

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olkswagen of America broke ground on the construction of its electric vehicle production facility in Chattanooga, Tennessee on Nov. 13. The company plans to assemble electric vehicles, specifically the ID CROZZ, in Chattanooga beginning in 2022.

“This is a big, big moment for this company,” says Scott Keogh, president and CEO of Volkswagen Group of America.

“Expanding local production sets the foundation for our sustainable growth in the U.S. Electric vehicles are the future of mobility and Volkswagen will build them for millions, not just millionaires.”

The Chattanooga site will be VW’s North American hub for EV manufacturing. The company began long-range EV production in November 2019 in Zwickau, Germany, and will roll out the assembly worldwide in 2020 and in the German cities of Emden and Hanover by 2022.

The $800 million investment in the Chattanooga facility will add about 1,000 jobs. This expansion of the plant includes a 564,000-square-foot addition to the body shop. Volkswagen will build internal combustion engine vehicles as well as battery electric vehicles on the same assembly line.

The company also intends to build a 198,000-squarefoot plant for the assembly of battery packs for EVs at the Chattanooga site.

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DAIMLER JOB DIP Mercedes-Benz’s parent company Daimler in December announced job cuts as the industry adjusts to electric vehicles, disappointing sales and tariff tensions. Company officials said the job cuts would amount to a “low five-figure number” over the next three years, translating to at least 10,000.

BUZZER SOUNDS President Donald Trump’s

Section 232 tariffs on foreignmade cars and car parts apparently won’t be happening as the administration passed its self-imposed deadline in November. Trump has pledged to level the global trade playing field.

ONE ODD-LOOKING TRUCK Its very angular and allegedly unbreakable windows cracked during an on-stage demonstration, but Elon Musk

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“With Volkswagen’s expansion, Tennessee is on the cutting edge of the move to electric vehicles and our workforce is up to the challenge,” Tennessee Governor Bill Lee said.

Tom du Plessis, Volkswagen Chattanooga CEO, said the expansion signals the start of new high-tech processes in the plant. Hiring for the new assembly will begin in early 2020 and will continue as needed in order to ramp up production.

Positions added for the expansion include supervisors, specialists and a variety of engineers specializing in electrical, software, mechanical, manufacturing, chemical and quality.

“Electric vehicle and electric-vehicle battery production require new and different technical skills than those we currently use,” du Plessis says. “We’re working with our colleagues abroad, as well as with Volkswagen Academy, to ensure our team members are well prepared.”

Volkswagen currently builds the midsize Atlas SUV and the Passat sedan at the Chattanooga factory, which began production in April 2011. Production of the five-seat Atlas Cross Sport began in Chattanooga in October 2019. It goes on sale in early 2020. The company currently employs approximately 3,800 workers. n —Erica Joiner West

recently unveiled his new electric truck at the Tesla Design Center in Los Angeles. As one wag put it, the design is more DeLorean than Silverado.

NEED AN ADDRESS? Two sites in Montgomery County, Alabama—the1,843acre Montgomery Mega Site, 2.5 miles from Interstate 65, and the 288-acre Kyser Property, less than a mile from U.S. 80—have recently been named

AdvantageSites by the Economic Development Partnership of Alabama.

STUDENTS GET INVOLVED Schools around the South are gearing up for another run at the U.S. Department of Energy’s EcoCAR Mobility Challenge. The competition stretches out for four years at a time, allowing each school, to upgrade a 2019 Chevrolet Blazer.

Honda Enters Deal To Decrease Carbon Footprint In Alabama

If It’s Your Car, Isn’t It Your Data?

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move by automakers to lock down the data on the cars they manufacture could require a new declaration of independence, according to voices heard at the recent Auto Care Association’s Legislative Summit.

A Daphne, Alabama company was one such voice heard at the event Sept. 18-19 in Washington, D.C. Members of Congress and the business group used the time, in part, to discuss how the ownership of vehicle data and the Motor Vehicle Owner’s Right to Repair Act are affecting car owners and car technicians.

As it stands now, auto repair technicians can typically access a customers’ onboard computer to get data to help with maintenance and repair. However, as vehicles get more complex, data is more often transmitted wirelessly and sent directly only to vehicle manufacturers. This denies independent technicians the ability to do their jobs and can create inconvenience, greater costs and fewer maintenance and repair options for customers.

Parts remanufacturers were among those calling for auto manufacturers to loosen their grip on this essential data.

One such that spoke out at the summit was BBB Industries, a remanufacturer of starters, alternators, hydraulic and air disc brake calipers, power steering products and turbochargers “Data ownership is a major concern, and many people are not aware of its impacts,” says John Boyer, BBB Industries executive vice president of marketing and product management. “Advocating for our industry is more important now than ever before, so it is critical that when we have the opportunity to get in front of our representatives, we take it.” n

PAYING THE PRICE Ford and General Motors may have lost some loyal customers over their decisions to stop building small cars. A study reported by Jalopnik says Druze and Focus owners still aren’t buying SUVs, opting instead for a different compact brand.

UNITED WAY TO GO Hyundai’s Alabama assembly plant has donated more than $335,000 to help United Way

agencies across the area. The factory’s 3,000 workers pledged $265,600, and the company chipped in another $7,000.

PORSCHE, MERCEDES MAKE BUYERS HAPPY A new edition of the Sales Satisfaction Index based on responses from more than 28,000 car customers who bought or leased in April and May of 2019 suggests Porsche and Mercedes buyers have the

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onda has entered into long-term virtual power purchase agreements (VPPAs) for renewable wind and solar power to cover more than 60 percent of the electricity it uses in North America.

The goal is to slash CO2 emissions from its North American manufacturing operations. These VPPAs will enable Honda to fully offset the remaining carbon intensive grid-supplied electricity being used in its Alabama, Ohio and Indiana auto plants, and will help the company meet voluntary carbon reduction goals.

Honda is one of the top automakers globally in the adoption of renewable energy to power its operations. Starting in fall of 2020, Honda will purchase 530,000 MWh/year from 120 MW of wind power generated by the Boiling Springs Wind Farm in Oklahoma. A megawatt hour (Mwh) is equal to 1,000 Kilowatt hours (Kwh).

In fall of 2021, Honda will buy an additional 482,000 MWh/year from 200 MW of solar power generated from a Texas solar facility.

Honda’s combined agreements for the output of 320 MW of renewable generation capacity will result in the purchase of 1.012 million MWh of electricity per year, making it the largest renewable energy procurement commitment for an automaker.

Once fully operational, these VPPAs will offset more than 800,000 metric tons of CO2e emissions annually, the equivalent of 100,000 U.S. households worth of CO2e emissions from household energy usage. n

fewest complaints involving the sales process.

G-WAGEN WILL HAPPEN Mercedes-Benz says an electrified version of its biggest and hunkiest vehicle, the beloved G-Wagen, is on the way.

The pledge comes six months after the introduction of the company’s first electric SUV, the ECQ.

TOYOTA BUYS BACK Toyota Motor Corp. in November announced a plan to buy back $1.8 billion shares after the company beat quarterly forecasts on vehicle sales in North America and beyond. Toyota saw its strongest second quarter since 2015.

RECESSION-PROOF SOUTH? A new study suggests that Alabama, Georgia and Tennessee, all automaking

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BE N C HM A R K S

Construction begins on Hendrick Center for Automotive Excellence

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onstruction began in November on Wake Technical Community College’s new North Carolina automotive training facility. The Hendrick Center for Automotive Excellence is named after Rick Hendrick, chairman of Hendrick Automotive Group and owner of NASCAR’s Hendrick Motorsports, who donated $1 million for the facility.

“There is a major demand for auto service technicians throughout our industry,” says Hendrick. “At our company alone, we currently have 500 openings for techs, and that need will only grow in the coming years. With so many opportunities out there, it’s important that we find partners like Wake Tech.”

Located on the Scott Northern Wake Campus, the $41.8 million, 100,000-squarefoot facility will enable the college to more than double the number of students in its automotive systems technology program and add a new degree program in collision repair. Skilled technicians in both areas are in high demand at local dealerships.

Currently, Wake Tech’s associate in applied science degree in automotive systems technology curriculum covers all automotive systems, progressing from the basics to advanced technologies, with a special emphasis on the electrical system, since electricity controls 99 percent of vehicle operations. It includes training in advanced diagnostics, brakes, electrical/electronic systems, engine performance, steering/ suspension, transmission, climate control and manual drive trains.

The Hendrick Automotive Group gift will provide funds for new technology and equipment, scholarships for students, and to help recruit and retain expert faculty.

“We’re extremely grateful for this generous gift and the partnership with Rick Hendrick and the Hendrick Automotive Group team,” says Wake Tech President Scott Ralls. “Industry partnerships such as this are vital to keeping our programs relevant and our community’s economic engine humming.”

The Hendrick Center for Automotive Excellence is the first of five major expansion projects funded by a $349 million bond issue passed in the fall. The architect for the project is Gensler. The construction manager is Brasfield & Gorrie. Construction is set to begin in November and end in time for classes to open in fall 2021.

Wake Tech is the largest community college in North Carolina, serving more than 74,000 adults each year. n ­ — Erica Joiner West

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forces, are among the top 10 states most able to dodge fallout from the next recession.

Online information service FitSmallBusinesss examined vulnerabilities to another downturn and found the best states were scattered across the South and Midwest.

STRIKE’S HIGH PRICE The price tag of the United Auto Workers’ 40-day strike against General Motors will be

between $3.8 billion and $4 billion for the year, GM recently says. It was the longest national walkout against GM since 1970.

HYUNDAI’S CROSSOVER BUMP Hyundai’s October U.S. sales increased 8 percent to 57,094 behind firm retail demand for the company’s crossover line.

Hyundai models Santa Fe, Tucson and Kona each saw a 16 percent or more spike in retail sales.

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Kia Telluride: Car And Driver’s 10Best List

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ar and Driver has elevated the Kia Telluride to its 10Best Trucks and SUVs list, honoring the industry’s best such vehicles on the market.

The selection is based on design, equipment, performance and road handling.

“The Telluride is rare in how good it is,” says Sharon Silke Carty, Car and Driver editor-in-chief. “It spoils passengers with features, is quiet, responsive and smooth. It stands out in the crowded three-row SUV market.”

Winners are picked based on a number of criteria, including value, driving dynamics and mission fulfillment. 10Best Trucks and SUVs awards are organized around segments and recognize one honoree from each category, including subcompact SUV, subcompact luxury SUV, compact SUV, compact luxury SUV, mid-size SUV, mid-size luxury SUV, large SUV, mid-size pickup, full-size pickup, and van. Nominees consist of allnew or significantly updated vehicles.

“This is an absolute honor,” says Michael Cole, president, Kia Motors America. “Car and Driver editors are widely respected for their automotive acumen and ability to bellwether the industry. A 10Best rating is a gold standard.”

A variety of Kia vehicles are assembled in West Point, Georgia. n

CARVANA EN ROUTE Carvana, a leading e-commerce platform for buying and selling used cars, will invest $40 million to build a new distribution and fulfillment center in Birmingham, Alabama, eventually creating more than 450 jobs.

NEW COMPANY EMERGES Fiat Chrysler and PSA, owner of Peugeot, plan a 50-50 merger to become the world’s fourthlargest automaker and creating

a $50 billion group. PSA’s Carlos Tavares will be CEO while FCA’s John Elkann will be chairman.

TRUMP POWER MOVE? While it still wasn’t approved at press time, the U.S.-MexicoCanada agreement meant to replace NAFTA could end up giving the Trump administration power to unilaterally control where cars and auto parts are made, according to some observers.

Hyundai in Alabama Adds Santa Cruz Assembly, 200 Jobs

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yundai Motor Manufacturing of Alabama announced that it will add a new vehicle to the production lineup at its Montgomery factory, part of a $410 million expansion project that will create 200 jobs.

Alabama workers will assemble the Santa Cruz compact utility vehicle at the facility beginning in 2021.

Hyundai says the investment will create an additional 230,000 square feet of space in the stamping, welding and parts processing areas of the manufacturing complex.

Hyundai intends to begin filling the new positions being created by the latest expansion project during the second half of 2020. Hyundai estimates that the expansion also will create another 1,000 jobs at supplier and distribution facilities.

“Bringing the Santa Cruz to HMMA demonstrates that Hyundai Motor Company is confident our more than 3,000 team members are ready to build a quality crossover for the U.S. market,” says Byungjin Jin, HMMA president and CEO. Hyundai currently produces the Santa Fe SUV and the Sonata and Elantra sedans in Montgomery. The addition of the Santa Cruz will provide HMMA with greater flexibility to adjust product mix based on market demands.

HMMA, which launched vehicle production in May 2005, is the Montgomery area’s largest private manufacturer, with 2,900 full-time and 500 part-time employees. Since it opened, the Alabama plant has produced 4.5 million vehicles for the North American market, along with more than 6 million engines. At present, economic development officials say Alabama is the fifth largest producer of cars and light trucks, and has more than 150 major auto suppliers and over 40,000 automotive manufacturing jobs.

“Alabama and Hyundai have developed a great partnership over the years, and it’s a testament to our special relationship that this world-class automaker is expanding once again in Montgomery,” said Alabama Governor Kay Ivey.

“Hyundai’s new investment is giving more Alabama families an opportunity to earn a good living while also strengthening the state’s growing auto industry.” n – Chris McFadyen

ABS A MIXED BAG The automatic braking systems being adopted by automakers are more useful at helping vehicles avoid pedestrians during the day, according to a new study by the Insurance Institute for Highway Safety.

But three models of midsize cars earned “no credit” in a review of their specific systems’ reliability.

FORD PROFITS STRUGGLE IN Q3 Ford Motor Co. lowered its guidance for the year after a 57 percent slide in net profits during its third quarter. Higherthan-expected warranty charges and incentives were blamed.

A BIT TOO MODERN Tesla Inc.’s Model S door handles retract, which police said was a problem when 48-year-old anesthesiologist Omar Awan slammed his car

Honda dominates in 2020 Kelley Best Buy Awards

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onda once again grooved the annual Kelley Blue Book Best Buy Awards, earning wins in more categories than any other brand, led by the 2020 Honda Civic as a 6-time winner in the Compact Car category.

Civic was joined by Accord, CR-V, and Odyssey, which have each won their respective categories in five of the past six years, and by the Honda Clarity Plug-In Hybrid, repeating its class victory for a third time.

The Clarity Plug-In Hybrid was praised for its driving dynamics, roomy interior and plug-in powertrain. It has won a Best Buy Award for three straight years.

The Kelley Blue Book Best Buy Awards are the result of a yearlong process of expert evaluation and testing of nearly every new vehicle available in the U.S. Criteria include vehicle pricing, 5-Year Cost-to-Own data, consumer reviews and ratings, and vehicle sales information. n

into a palm tree in Florida.

Bystanders were unable to help him as the car filled with smoke and flames, according to a lawsuit.

STRIKE’S TOLL FELT HERE French car parts group Faurecia saw its stock shares drop 6.5 percent on France’s SBF120 index of most actively traded stocks during the UAW strike against General Motors Co. Faurecia makes automotive

seating at two locations in Alabama.

HYUNDAI’S $35B TECH SPLURGE Hyundai Motor Group will spend $35 billion on mobility and other auto technologies by 2025, part of an effort to play a bigger role in the development of self-driving cars. The company also announced a $1.6 billion investment in the self-driving tech firm Aptiv.

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BE N C H M A R KS

Hyundai unveils 2020 Sonata at Miami Auto Show

Avalon Gets First-Ever TRD Treatment for 2020

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yundai on Nov. 1 revealed to the South its all-new 2020 Sonata, its longest-standing and most successful model, at the 49th Miami International Auto Show.

The eighth-generation Sonata also began production the same day at Hyundai Motor Manufacturing Alabama in Montgomery, and retail sales started later in November.

“The Southern Region is one of Hyundai’s fastest growing and most valued markets,” says Steve Flood, regional general manager, Hyundai Motor America. “We’re proud to debut the allnew Sonata at the Miami International Auto Show on the same day it begins production.”

The 2020 Sonata has a sporty four-door-coupe look that represents Hyundai’s new focus on creating emotional value using proportion, styling, and technology. It is the first model to be based on Hyundai’s new, innovative vehicle platform, which delivers increased strength and reduced weight to enable improvements in design, safety, efficiency and driving performance. The car uses an extensive application of advanced technologies to boost comfort, convenience and active safety.

“The Sonata holds a special significance for our company as one of the longest-standing and most successful models in the global market,” says Mike O’Brien, vice president, product, corporate and digital planning for Hyundai Motor America. “We are confident that our customers will be pleasantly surprised by this innovative new model.” n

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TOYOTA’S HYDROGEN MOVE Toyota Motor Corp. is working on hydrogen-powered fuel cell sedan that it hopes will one day be in common use. Batterypowered vehicles are more common but hydrogen offers the cleanest environmental impact.

THE WRONG STUFF Some journalists learned recently at an event put on by Mazda Toyota Manufacturing

USA that they lack the right stuff for being industrial athletes.

The group took part in an Assessment Center Media Day in Huntsville, Alabama meant to show how factory hiring works.

GOODYEAR PLANT WOES The Goodyear Tire Plant in Gadsden, Alabama opened 90 years ago, but now company officials say it’s the highest-cost plant and the oldest Goodyear plant in North America, which is

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oyota Racing Development will put its first influence ever on the 2020 Toyota Avalon TRD, the company announced in September.

The fifth-generation Avalon, which marks its 25th year, can boast being among the first vehicles built around the Toyota New Global Architecture (TNGA), which brings together new body structures, along with fresh views of engineering, production and materials.

For 2020, the Avalon TRD – joining the 2020 Camry for the debut of the first-ever Toyota sedans to wear the TRD badge – is for the driver who prefers aggressive road grip and handling.

The fifth-generation Avalon mixes a bevy of Toyotafirsts such as standard Apple CarPlay compatibility and available Dynamic Auxiliary Turn Signals, plus available aluminum and authentic Yamaha wood cabin accents.

The new-generation Avalon offers two TNGA powertrains: a 3.5-liter V6 and Toyota Hybrid System II (THS II). The 24-valve, DOHC 3.5-liter V6 engine is equipped with the D-4S fuel injection system, which combines direct injection with supplemental port fuel injectors. In addition, the engine uses a specially developed VVT-iW (Variable Valve Timing-intelligent Wide) variable valve timing system for the intake, with VVT-i on the exhaust. The VVT-iW system can switch the engine to the Atkinson cycle, which reduces pumping losses by delayed closing of the intake valves, helping to reduce fuel consumption. n

why 175 workers were recently laid off. The company is also offering buyouts.

WORKING TOGETHER Automakers in October announced the formation of the Autonomous Vehicle Computing Consortium, including Arm, Bosch, Continental, GM, Toyota, Nvidia, NXP and Denso, to share talent and resources in bringing autonomous vehicles to the market.

A NEW HOME FOR RAV4S Toyota Motor Corp.’s largest plant in the world, in Georgetown, Kentucky, has been charged with building a new model. Company officials were aiming to begin producing RAV4 sport utility vehicles at the 1,300-acre plant by early 2020.

SHINHWA GROUP ARRIVES South Korea-based auto supplier The Shinhwa Group will open a $42 million

Mitsubishi Moves Staff From Left Coast To South

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itsubishi Motors North America in November announced a new headquarters location close to Alliance partner Nissan in the Nashville suburb of Franklin, Tennessee.

The company will shift employees to the new offices from

Los Angeles, which has seen a steady outflow of business as companies seek addresses that offer a lower cost of doing business. Nissan recently shifted much of its staff from L.A. to Tennessee, while Toyota has moved employees from Torrance, California to Plano northeast of Dallas, Texas.

Mitsubishi has signed a long-term lease to use the top two floors of the greenfield-developed Northside at McEwen building when it is completed in early spring 2020. The building is at 4015 Aspen Grove Drive in Franklin.

“Our move to Tennessee marks the most visible part of the broad and substantive reinvention of every aspect of our business that is under way,” CEO Fred Diaz said in a statement.

MMNA will occupy temporary facilities in the Spaces Mallory Green building, where many staffers have already moved. As part of the change, the company is hiring 150 new people with 50 already on the job. n

Texas Auto Scribes Give Nod To Volvo XC90 Plug-In Hybrid

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he Volvo XC90 plug-in hybrid electric vehicle has been named Mid-Size Luxury SUV of Texas by the Texas Auto Writers Association (TAWA), marking the fifth consecutive year a Volvo SUV has won a nod from the 32-year-old group.

The 2020 edition of the Volvo XC90 got the benefit of new design features, technology, utility and safety. Highlights include a newly available six-seat configuration that provides easier access to the third-row seats, updated styling, colors, and finishes, and a new Tailored Wool Blend interior option.

It offers three powertrains: a 400 horsepower plug-in hybrid with over 400 miles of total range, a 316 horsepower gas powertrain, or a 250 horsepower gas powertrain. Volvo’s Intellisafe suite of driver assistance features comes standard, including Collision Avoidance by City Safety, Pilot Assist with Adaptive Cruise Control and Distance Alert, Oncoming Lane Mitigation with Steering Assist, Blind Spot Information System (BLIS), and Cross Traffic Alert with Autobrake.

manufacturing operation in Auburn, Alabama to make drive shafts for Hyundai, Kia and eventually, other manufacturers as well. The plant is expected to employ 95.

FIRST DAUGHTER VISITS Ivanka Trump visited North Alabama recently to check out programs designed to ease the nation’s shortage of skilled workers. She met students from Calhoun Community

College and leaned about the Federation for Advanced Manufacturing Education, also known as FAME. GEELY, VOLVO MERGE ENGINES Zhejiang Geely Holding Group and its wholly owned subsidiary, Volvo Car Group, said in October they would merge their existing combustion engine operations to develop next-

“Our members were undeniably impressed with the Volvo XC90 T8 Inscription at the Texas Truck Rodeo,” says Kristin Shaw, TAWA Vice President of Events. “Volvo consistently represents the one-two punch of luxury and safety, and the attention to detail is clear in features like the crystal gearshift and upscale materials. Yes, it’s beautiful inside and out, but the XC90 is also hardy enough to manage tough terrain.” n

gen combustion engine and hybrid systems. The deal would allow Volvo Cars to focus on developing its all-electric range of premium cars.

A ‘STAR WARS’ PORSCHE Designers at Porsche AG and Lucasfilm Ltd. are working on a fantasy starship design that will hit the big screen in “Star Wars: The Rise of Skywalkers.” says Doug Chiang, VP and executive creative director of Lucasfilm:

“The worldwide appeal of the Star Wars and Porsche brands is shaped decisively by their iconic designs.”

READY FOR AIRLESS TIRES? French-based Michelin is working on Uptis, short for Unique Puncture-Proof Tire System. While that may not be the final name, the system is aiming to be on General Motors’ vehicles as early as 2024.

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B E N C HM A R K S

Kia Produces 3 Millionth Vehicle In Georgia

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ia Motors Manufacturing Georgia Inc. rolled out its three millionth vehicle in September — a white 2020 Telluride SX Prestige.

West Point-based KMMG started mass production in November 2009 and today produces more than 40 percent of all Kia vehicles sold in the United States. The plant, which builds more than 340,000 vehicles a year, is home to the Telluride SUV, Sorento CUV and Optima midsize sedan and represents an investment of more than $1.1 billion. More than 90 percent of the vehicles assembled at the plant are destined for dealerships in America.

“Producing three million vehicles in less than 10 years is another example of the commitment and results of the KMMG team’s ‘One System, One Team’ philosophy,” says KMMG President and CEO Jangsoo (Jason) Shin. “The world-class

quality that goes into every Telluride, Sorento and Optima we build is a direct result of the hard work and dedication of our team members, and today we salute their commitment to excellence.”

KMMG will celebrate its 10th year of production later this year. It is the first manufacturing site in North America for Kia Motors Corp., based in Seoul, Korea. n — Erica Joiner West

Nucor ramps up $230M cold steel complex South Carolina

N

ucor Steel Arkansas recently opened its new $230 million specialty cold steel mill complex in Hickman (just north of Memphis, Tennessee,) which can now feed the automotive steel market throughout the South.

The company hired 100 new workers for the mill, in the Mississippi County town of Blytheville, Arkansas.

The complex expands Nucor’s capability to produce automotive grade steel, namely advanced, high-strength lowalloy and motor lamination steel products. This will expand the number of products the company can make for the auto industry.

“As a world leader in steel manufacturing technology, Nucor is particularly focused on increasing productivity and

N E W S

H U B

HOW ABOUT FLYING CARS? Americans have waited too long for flying cars. Hyundai Motor Group in October established the Urban Air Mobility Division to develop core technologies that will establish the company as a driving force in urban air mobility, a sector that is expected to grow into a market worth $1.5 trillion within the next 20 years.

PLANT MARKS 20 YEARS Continental AG’s power transmission products plant in Chihuahua, Mexico recently marked its 20-year anniversary.

Built in 1999, the factory produces power transmission belts for a wide range of applications including the automotive field.

MORE TAKATA WOES Faulty Takata airbags have already given the auto industry

18 | Southern Automotive Alliance | WINTER 2020

efficiency, and competing in global steel production. With today’s automakers counting on steel as their material of choice to reduce vehicle weight, while at the same time improving both safety and performance, our new cold mill will be at the forefront of making these advanced high-strength steel products,” says Jay Henderson, vice president and general manager of Nucor Steel Arkansas.

“I am thrilled that Nucor chose Hickman as the site for its new specialty cold mill complex,” says Arkansas Governor Asa Hutchinson. “Northeast Arkansas is proud to be a longstanding leader in the steel industry, and Nucor’s investment in Mississippi County over the past 30 or so years has made a substantial economic impact to the region.”

Nucor Corporation is America’s largest steel and steel products producer, with approximately 27,000 teammates working safely at 25 steel mills and more than 300 operating facilities throughout North America. Last year, Nucor produced more than 24.7 million tons of steel and more than $25 billion in revenue. n

its biggest recall, affecting tens of millions of vehicles, but it expanded in early December when Takata added another 1.4 million vehicles to the list. The new problem, like the old one, causes inflators to expel sharp objects.

NISSAN TAKES A BREAK Nissan planned to put its U.S. employees on unpaid furlough Jan. 2 and Jan. 3 as well as cut employee travel expenses after

its new chairman took over and began the process of cutting company expenses.

KEEPING IT TUBULAR Canadian-based Samuel, Son and Company, a maker of tubular metal products for automotive and other uses, recently announced an expansion in Birmingham, Alabama. The company chose Jefferson County in part because of government incentives.

Register now for South Carolina Automotive Summit

T

he 2020 South Carolina Automotive Summit in Greenville, South Carolina in February is shaping up with a powerful slate of speakers and presentations.

Organized by the South Carolina Manufacturers Alliance, the annual event draws executives, managers and top decision makers of original equipment manufacturers, tier 1, 2 and 3 suppliers, research institutes, test facilities, logistics and other service providers with ties to the automotive industry.

The dates this year are Feb. 26-28. For more information or to register, visit myscma.com.

“Automotive is an economic powerhouse for our state bringing jobs and tremendous capital investment,” said Amy Tinsley, executive director, SC Automotive Council. Speakers on the agenda include: • South Carolina Secretary of Commerce Robert M. Hitt III; • Sara Hazzard, president and CEO of SCMA; • Simon Kew, vice president, Operations, Magna International; • Gary Silberg, partner, National Automotive Sector Industry leader for KPMG; • Carla Whitlock, senior apprenticeship consultant, Apprenticeship Carolina; • Margaret O’Riley, Economic Development for Duke Energy; • Didi Caldwell, site location consultant, Global Location Strategies; • Morgan Crapps, site selection and economic development Parker Poe; • Alexandra Segers, senior vice president, Evans International; • Sven Bieker, founder and managing director, Silicon Valley Mobility; • Jeff Schuster, president, global forecasting, LMC Automotive; • Pete Mento, managing director global customs and duties, Crowe LLP; • Jim Newsome, president and CEO, South Carolina Ports Authority; • Jody Bryson, president and CEO, South Carolina Technology & Aviation Center. n — Erica Joiner West

HYUNDAI SUVS UP Hyundai Motor America sales for November were up 6 percent year over year, the company says, with help from its SUV lineup and initial sales of the 2020 Sonata. The company reported 60,601 vehicles sold for the month.

GOODBYE, NEW YORK Mercedes-Benz won’t be attending the New York Auto Show, Automotive News reported

in December, as the luxury automaker seeks new ways of connecting with buyers and the media.

KENTUCKY, CHINA TIGHT While trade tensions remain in the headlines, Kentucky plans to collaborate more closely than ever in 2020 with China in trade and other areas. “China is probably the country or the partner that we have the most forward momentum with right

UA Rolls out Research Partnership Opportunity

T

he University of Alabama recently launched the Tide Research Partnership Program, aiming to strengthen research and development partnerships with industry, while accelerating opportunities for students to work toward solving some of society’s most challenging problems.

The program encourages companies to sponsor research opportunities at UA. Upfront costs are set for exclusive rights to possible intellectual property created by UA researchers and increases the percentage inventors receive of future royalty payments.

“We believe this program will contribute to a fundamental change in the way industry interacts with UA that will extend well beyond any single research project,” says UA President Stuart Bell.

The Tide Research Partnership Program allows a company an option to pre-pay a fee when executing a sponsored research agreement in exchange for exclusive worldwide rights to resulting inventions. UA gets 1 percent in royalties when the net sales of commercialized products using the technology exceed $10 million annually. n

now,” Craig McKinney, director of international affairs at Kentucky’s Cabinet for Economic Development, told the Xinhua news agency.

STUDENTS FIX HISTORY Automotive students at Jones County Junior College near Hattiesburg, Mississippi are sharpening their skills by working on a 70-year-old Army Jeep for the Mississippi Armed Forces Museum at Camp Shelby. The

vehicle will be used in military parades and other activities.

NEW STANDARDS NEEDED Greenville-based tire maker Michelin North America has requested its new type of airless tire be exempted from current safety standards, the first step in getting new standards developed by the National Highway Traffic Safety Administration for the new tire design.

WINTER 2020 | Southern Automotive Alliance 19

EXECUTIVE Q&A TEXT BY: NICK PATTERSON // PHOTO BY: ASH WRIGHT // PHOTOS COURTESY OF: APMA

As an advocate for Canada’s auto sector in the American South and everywhere else, Flavio Volpe has a job he was made for

A CAR GUY W

hen Flavio Volpe took the stage at the most recent Southern Automotive Conference, the small audience that heard him were treated to a funny, informative presentation

about how Canada relates to its more populous Southern cousin - particularly when it comes to making cars. The fact that Canada has five OEMS is just one of many aspects of Canada’s auto industry Volpe is proud of both as a native, and the president of the Automotive Parts

companies, Volpe was showing off three

a new vehicle right now. First, the Arrow.

vehicles built in Canada to demonstrate their technical prowess — and, by the

Q: Tell me about the zero-

way, announcing that his country is

emissions vehicle you announced

about to build a car uniquely their own

today - Project Arrow.

— the Arrow.

Flavio Volpe: There was a 1950s

Volpe took time to talk to Southern

fighter jet prototype built in Canada by

Automotive about why he and Canada

a company called Avro. It had better

have such a love for the automotive

capabilities than any of the Allies —

business, why they’re so interested in

NATO Allies or the Russians at the time

the Southern U.S. - Canada always has

— both in speed and maneuverability,

a delegation to the SAC and speakers on

avionics, everything else. The Canadian

the program - and why they want to build

government ultimately did not make

Manufacturers Association (APMA).

His organization lobbies for parts makers and suppliers in Canada all over the world. That’s what brought him in January to the annual CES in Las Vegas.

There among the highest of high tech 20 | Southern Automotive Alliance | WINTER 2020

I think that the South as a cluster of automotive assembly is going to will continue to grow and probably match the North in terms of units of production within the next ten years. So a very smart growth strategy for all of us is to invest in parts footprint in the South and supply Southern customers from their backyard.

ADMA took this Lexus to the consumer electronics show in Las Vegas to show off Canadian tech progress

major purchases of it … but the systems and the people that came out of that project led to Canadian aerospace and ultimately, space industry through the 1990s.

So we’re taking inspiration from that and saying look we don’t have any Canadian automakers. But we do have a great Canadian automaker footprint here, five OEMS. I constantly get asked whether the Canadian supply base is capable of producing world class technology… Its kind of hard to say yes and then demonstrate it when all you’re doing is bidding on somebody else’s specs and projects. So we said, look, why don’t we do a custom vehicle. The filter is, its got to be all Canadian — design, engineering, components, systems.

And then use this vehicle as a rolling platform to show the world… that we can do absolutely the best work out of Canada and we will.

Q: In your presentation at the latest

that those are companies that are

Southern Automotive Conference,

Canadian-based… between Toronto and

you talked a lot about connections

Detroit and there’s lots of collaborations

between Canada’s auto industry

like that kind of advanced tech that we

and the rest of North America.

do - that we’re going to do on Arrow.

What were you most eager to help

Might be great for partnership with

attendees understand?

other suppliers in the South and/or for

FV: The last ten years a lot of the

automakers based in the South to look

tariff-free export into that market, you have to achieve a certain percentage of content. NAFTA was always the highest level at 62 and a half. And then we all went and signed crazy agreements where the feature of those agreements is that that number was less than half. And what that does is erodes the impetus for

north for supply as well.

sourcing locally, and so while it might

Southern U.S. and Mexico. And I

Q: You were a major player in

little bit more cheaply and sell them to

think people forget the biggest cluster

what’s become the USMCA. Talk

the American consumer… it also eroded

in North America is Midwest, Great

about your vision for that trade

the American and the Canadian parts

Lakes, and it’s still there and it’s still

agreement.

supply base….

relevant. And a lot of exciting things are

FV: Every other trade agreement

talk has been about the build up of two regions… in new clusters: the

happening there and a lot of companies headquartered there are building up capacity in the South and supplying automakers in the South. I just wanted to make sure that we draw that link.

When you think about Martinrea or Magna or Linamar that you understand

signed by … any of the three countries in the NAFTA region - all the other agreements signed within the last 20 years signed with other players featured a reduction in the regional value content for automotive production. What that means literally is you make a car for

be easier for automakers to make cars a

Our chief vision for the USMCA was, ‘Can we reverse a 20-year trend and get the regional content value up?

At the beginning everybody said it was impossible. Of all the failings of the Trump Administration the one place where we all saw eye-to-eye on was that administration understood that erosion WINTER 2020 | Southern Automotive Alliance 21

E X E C U TI V E

Q& A

south of the border is what led to the free trade agreement between the two

Canada’s automotive infrastructure packs tech into cars like this. They’re looking to build an all Canadian car soon.

countries 23 years later. And that free trade agreement became the basis for the NAFTA. ...and Canada’s auto sector is what opened the rest of the economy to a closer relationship with the U.S. and economic prosperity that the two countries couldn’t have accomplished apart from each other.

Q: What do you think the forecast is for automotive in general, given what you see now? There are a lot of mixed predictions about where things go from here. Just wondering what you see.

FV: You know, the death of the auto sector has been called for each decade for the last 100 years. There’s going to flying cars. There’s going to be hydrogen

and what that meant for American jobs

in the South will continue to grow?

cars. Now we’re going to share cars

both in the Midwest and potentially in

FV: I think that the South as a cluster

and urban centers are going to move to

the South.

of automotive assembly is going to

cycling and pedestrian traffic only….

And we rose to the challenge and

will continue to grow and probably

Automotive products are the most

we’ve now created a document that all

match the North in terms of units of

advanced platforms for commercial

three countries are on board for and that

production within the next ten years.

R&D, applications of creativity around

number, the regional value content of 75

So a very smart growth strategy for all

the world. I think the auto sector is

percent is unprecedented.

of us is to invest in parts footprint in the

going to lead the solutions of many of

South and supply Southern customers

the things that taint society right now. ...

Q: What is the difference in

from their backyard.

I think what’s going to happen is there’s going to be, of course with

Canada’s approach to the Southern auto sector as opposed to the

Q: You showed a lot of pride in

autonomous zero emissions vehicles.

approach and relationship you’ve

Canada’s automotive sector (if you

You’re going to have a fleet a global

built with the rest of the U.S., aka

haven’t addressed this yet) what

fleet of safe, green, connected vehicles

traditional Detroit automakers?

are you most proud of over the

50 years from now. And if they’re safe,

FV: It is easier to supply from your

years?

meaning they don’t hit each other,

Canadian capacity into the Midwest

FV: You know the auto sector in

they’ll be lighter. If they’re green, they

than it is in the South. So the nuanced

Canada in its relationship with the

don’t emit… And if they’re connected

difference is still very much aggressively

auto sector in the U.S. is what led to

we’re going to be able to manage traffic

seeking supply opportunities in

the first international trade agreement

volumes much differently. I think

the South but if you win those

signed by your country. It was the 1965

that means more people on the road.

opportunities, you’re investing in the

Auto Pact [the Canada—United States

That means more cars… We’re solving

South...Canadian companies have

Automotive Products Agreement].

all the problems related to personal

become Southern investors.

The dynamics, the sheer volume of

transportation. So how’s that going to

exchange, the importance of auto

make personal transportation disappear?

Q: Do you think that the investment 22 | Southern Automotive Alliance | WINTER 2020

investments in so many towns north and

And we’re not all taking to the air. If

Automotive products are the most advanced platforms for commercial R&D, applications of creativity around the world.

I think the auto sector is going to lead the solutions of many of the things that taint society right now.

the passion is cars and I ended up as a

we solve it on the ground, there’s no need

highway. My dad was doing everything

to clutter the air.

he could to keep up with this thing and

car paraphernalia - I just love cars. And I

couldn’t make it. I fell in love with it.

Q: I got the impression that you

I fell in love with the neighbor’s 1981

have a personal fondness for cars.

Corvette, and just couldn’t get it out of

How did that come about? what’s

my head.

that all about?

I’m a car guy. My first car was a 1976

FV: I want to say, I’m Italian, and

Corvette. My second car was a 1980

that means when we were growing

Corvette. My last five cars have averaged

up, Italians like to watch - at least the

600 horsepower. I’m a hot rodder and I

ones I grew up around - they liked to

break parts.

watch Formula One and they liked

We built and rebuilt race cars. It

watching Ferrari. Fell in love with the

was almost inevitable I was going to

stories there. I remember going up to a

end up in the parts business. But my

cottage when I was 9 or so in my dad’s

father was a federal cabinet minister

six-cylinder brown Plymouth Volare

and member of parliament for 25 years,

coupe chasing a Ferrari 246 Dino up the

so .. the family business is government,

car lobbyist. And I named my son, my youngest, after the first guy to win a race for Ferrari in 1932. I come to this job every day into my office with all kinds of think in part - you know everybody says that cliche thing - you got to love what you do and it never feels like work.

The other thing you got to say, is if you’re going to advocate for something you better love it. You can be really really smart… but if you don’t love it, you miss the opportunity to do something special like push really hard for the industry to get unprecedented gains in the USMCA or launch your own concept vehicle. I may not do this job forever, but I’m going to be a car guy forever.” n For the full interview, see southernautomotivealliance.com

WINTER 2020 | Southern Automotive Alliance 23

EXECUTIVE Q&A INTERVIEW BY: NICK PATTERSON

Out of the West A business ambassador for the Sooner State is traveling, with hopes to lure automotive suppliers to ‘go west.’

O

klahoma is not an automotive hub,

JS: Yeah, doing a lot of traveling – trying

could feed through our transportation

but the state is trying to put its best

to get the message out. So one of the

system to the Southeast where most of

foot forward toward becoming one

things that we noticed through the data

the OEMs or the Tier 1 companies are.

– resulting in a recent visit by an

that’s been coming out for foreign direct

official to the Southern Automotive

investment is that a lot of the companies

Q: What makes Oklahoma the right

Conference in Nashville.

in the Southeast that are clustered

place for that shift?

Jennifer Springer is the director of

around the automotive industry, there’s a

JS: Our geography is unique; we are

Global Investment and Trade at the

couple of phenomena that are going on.

right in the middle of the United States

Oklahoma Department of Commerce,

First, wages are being pushed up because

but we’re also at the crossroads of I-35,

and she and her colleagues staked out

those employees are moving back

which goes from Canada to Mexico, and

a booth at SAC2019 hoping to drum up

and forth to different companies with

then I-40, which goes east coast to west

automotive business -and specifically

different job openings that have better,

coast. Plus we have a port system and rail

supplier business for her state. It’s not

you know, better opportunities, and so it’s

system, so we really have an advantage

her first stop on the goodwill tour, as she

causing wage pressure on these smaller

for those parts manufacturers that are

explains in this question and answer

to mid-size parts manufacturers. And so

not just-in-time to the OEM suppliers,

session. The interview has been edited

we noticed that that corridor is shifting to

but have a little bit more length in their

for clarity.

the west. And so that puts Oklahoma in a

deadline that allows them to locate a little

prime spot.

further away being able to hire quality workers and not have to compete with

Q: Tell me about your journey to increase Oklahoma’s share of the

Q: What are you hoping to see?

some of the OEMs and Tier 1 companies

automotive pie. I know you’ve been

JS: Automotive parts manufacturing

for wages. So …it’s a good opportunity

traveling.

suppliers in the state of Oklahoma that

for us there.

24 | Southern Automotive Alliance | WINTER 2020

Q: Does your proximity to Mexico

project to rebrand the state of Oklahoma

and the NAFTA-replacement treaty

to give everybody around the state – all

– the USMCA - figure into your

industries and all efforts on tourism

approach?

and commerce a clear and consistent

JS: There’s a couple of things that

message.

ended up in the Mexico portion of that treaty. … By 2023 auto workers in Mexico

Q: Talk about the engineering tax

are going to have to be paid at least $16 an

credit and how that drives your

hour, and then 75% of automotive parts

initiatives.

are going to have to be manufactured

JS: One of the items that was completed

in the United States for cars built in the United States as opposed to, I believe, 62 or 63%. So there’s a lot of automotive parts manufacturers that are across the border in Mexico that are looking probably to reshore into the United States, and I think that really gives Oklahoma an opportunity.

Q: How did Oklahoma decide that automotive was a sector of industry that you wanted to go after?

JS: Well, I think two things. You know, watching the data, seeing the movement of the corridor to the west, but secondly one of the things about automotive parts manufacturing it at least 20% of those companies coming into the United States locate in rural areas. Oklahoma has a very unique geography where we do have two metropolitan areas that are very robust, that are heavy into aerospace and energy, but we have a lot of rural areas that would have sites and a workforce that could support these automotive projects.

Q: Tell me about your travels to recruit automotive business into your area.

JS: First, we’re conducting research and looking to see the automotive industry as a whole, where could Oklahoma play in the subsector surrounding the automotive industry – what would be advantageous and where would we have

by the Oklahoma legislature last year was an opportunity as a state to participate in those industries? And then, working with our workforce and establishing programs proactively that would help us recruit. That has to be done here in the state. We were lucky that the Oklahoma legislature had a line-item budget to help us break into the automotive industry, and so we’re utilizing those dollars to conduct research. But then we also have an aggressive recruiting campaign. And so we’re visiting some shows around the United States that are going to be automotive-centric, and then we also will be at the Stuttgart Automotive Show in the spring and working with various chambers of commerce around the world, especially in Germany and the UK and France where automotive plays a bigger role in the economy – working with their chambers to show off what Oklahoma has to offer and then help make connections with Oklahoma businesses here in the state.

Q: So how is your European outreach progressing?

JS: You know, we just launched this initiative at the end of [2018], but it has been a very well-received message; they’re very curious about the state of Oklahoma and what we have to offer.

And I think this dovetails nicely with the lieutenant governor’s [goals] …He has a

the Automotive Engineering Tax Credit, and that is very similar to the Aerospace Engineering Tax Credit, which has been very successful for Oklahoma for recruiting engineers to come to the state and work at advanced technology aerospace companies. … And what that does is that it not only assists companies that are hiring engineers in the state, it gives a credit to the engineer that locates here or stays in the state and works at one of these companies. It helps uphold the message that Oklahoma invests in its workforce and we’re here for them, too.

And so this is really a first of its kind that we’ve found in the automotive industry, and we think it will be a very helpful recruiting tool going forward.

Q: What would you like our readers to know about Oklahoma’s outreach efforts?

JS: I think I would say Oklahoma is open for business. We aggressively are working with companies to find a location in the state. We invest in our workforce. This is the most important asset that we have in the state, and we are implementing programs to help companies be successful. And we have a top down – from the governor down to the Department of Commerce – a very flat relationship that allows us to mobilize and move quickly and invite companies to come to the state. n WINTER 2020 | Southern Automotive Alliance 25

INDUSTRY OUTLOOK

Labor Agreements Signed But Automakers Still Awash In Issues

Intellectual properties statute may impact auto development TEXT BY: BILL GERDES

N

ow that the Big 3 automakers have reached agreement with the United Auto Workers, one major issue facing auto makers has been settled, but the United States-MexicoCanada (USMCA) trade agreement and the Trump Administration’s approach to tariffs still loom, as well as a possible split among automakers in the fight over emission standards in California.

Also in the mix are potential export

26 | Southern Automotive Alliance | WINTER 2020

controls on a list of technologies crucial to the auto industry.

As for the United States-MexicoCanada trade agreement, (formerly NAFTA) signals in Washington indicate that the NAFTA replacement is moving along and will probably be implemented in early 2020.

The House of Representatives has approved the measure but Senate Majority Leader Mitch McConnell

decided not to move the pact through the upper chamber until after President Trump’s impeachment trial is over, whenever that may be.

Industry observers say the bill is expected to get bipartisan backing in the senate. Canada hasn’t ratified the agreement yet, but if the USMCA gets through Congress, Canada will likely pass it, too.

But the new agreement’s automotive

guidelines set a higher bar for cars and auto parts that can be imported duty-free, based on the origin of their parts and labor rules of the countries in which they were made. As a result, the Congressional Budget Office, has noted that fewer companies in the USMCA partnership will qualify for duty-free import status, costing automakers nearly $3 billion more in tariffs over the next decade for cars and parts that will not meet higher regional content requirements.

The projection was contained in the cost estimate created by the non-partisan budget referee agency regarding implementing legislation for USMCA. For autos to receive tariff-free access between the three countries, the USMCA imposes a 75 percent regional content requirement, up from 62.5 percent in NAFTA, along with new mandates to use North American steel and aluminum.

In addition, 40 to 45 percent of vehicle content must come from highwage areas paying more than $16 an hour, primarily the United States and Canada. Some vehicles produced in Mexico mainly with components from and outside the region may not qualify for U.S. tariff-free access.

CBO said its estimate assumes that some vehicles and parts would not be eligible for USMCA’s tariff-free access.

“Because of that change in eligibility, CBO projects that duty-free imports of vehicles and parts into the United States from the USMCA partner countries would decline,” the agency says.

While it says a portion of those vehicles and parts would be replaced by U.S. production, some imports of nonUSMCA-compliant vehicles and parts would continue, receiving less favorable treatment.

The agency predicts that the U.S

would collect $2.79 billion in tariffs from those imports, which would mean automakers are paying that much more.

Kristin Dziczek, vice presidentresearch, at the Center for Automotive Research in Ann Arbor, Michigan, says once USMCA gets to the Senate, that body has up to 45 days to consider the implementing legislation.

“Then it moves to the administration for the approvals and there have to be rules that are written for the commerce department and customs bureau about how they are going to handle things and that takes some time, too,” she says.

“When they signed the deal they were expecting passage sometime in 2019 and then a couple of months to get the rules and regulations put in place so they could start on Jan. 1, 2020.

“So we will move forward into 2020 and we will get a new target start date once it passes in the U.S. and the rules and regs are written, and Canada passes it as well. Canada just completed a federal election and the party in charge remains the party in charge, so I don’t think there is any fear that Canada is going to have any real issues.”

As for the U.S. president’s threats to impose tariffs on car imports, the European Union’s chief trade negotiator says the U.S. likely won’t follow through on the threat because a U.S. deadline for the tariffs has come and gone without any action.

But Dziczek says the auto industry may want to keep an eye on a potential “301 case.”

Sections 301 through 310 of the Trade Act of 1974, commonly referred to as simply Section 301, are the principal statutory means by which the United States enforces its rights under trade agreements and addresses foreign barriers it determines to be unfair to U.S. exports. Section 301 applies to acts, policies and practices that the

USTR determines either violate or are inconsistent with a U.S. trade agreement or are unjustifiable.

“I don’t think the issue of tacking on additional tariffs on European or Chinese or Japanese or anybody has gone away just because that authority has expired,” Dziczek says. “There are aspects of trade policy or trade law that they could utilize if they wanted to open up a new case, so one thing I have heard about is a potential 301 case; 301 is the trade statute that is being used to deal with China basically about intellectual properties.

“There is also a process that the Bureau of Industry and Security started last November looking to impose potential export controls on a list of technologies,” Dziczek says. Of the 17 technologies listed, 14 are relevant to the auto industry.

“Usually these export controls are used for sensitive technologies; you don’t send them to state sponsors of terrorism or rogue nations.

They published a list of emerging technologies that they were considering putting export controls on.”

Dziczek says such a move could significantly slow the pace of development in technology sharing across multinational companies, especially auto manufacturers.

The U.S. Department of Commerce in November issued a notice of proposed rulemaking and requested comment on the implementation of Executive Order

If we impose this export control, which means we can’t take our technology there, and they retaliate in kind and say, well, we won’t send you ours, that could really slow the pace of development.

— Kristin Dziczek, vice president-research, at the Center for Automotive Research

WINTER 2020 | Southern Automotive Alliance 27

I N D US T R Y

O U TLO O K

I don’t think the issue of tacking on additional tariffs on European or Chinese or Japanese or anybody has gone away.

— Kristin Dziczek, vice president-research, at the Center for Automotive Research 13873 entitled “Securing the Information and Communications Technology and Services Supply Chain.” The notice says “The Secretary (of Commerce) has chosen to adopt a case-by-case, factspecific approach to determine which transactions must be prohibited, or which can be mitigated, according to the requirements in the Executive Order. The Secretary will use assessments developed by the Secretary of Homeland Security and the Director of National Intelligence pursuant to the Executive Order, among other things, to inform his evaluation of ICTS transactions.”

Position, navigation and timing technologies required and necessary for automated driving could be impacted, Dziczek says.

“Say that Germany has some technology that is really important 28 | Southern Automotive Alliance | WINTER 2020

for this. If we impose this export control, which means we can’t take our technology there, and they retaliate in kind and say, well, we won’t send you ours, that could really slow the pace of development.”

The areas involved include biotechnology, artificial intelligence, position development, navigational and timing, micro-processing, advance computing, data analytics, quantum information, logistics technology, advance manufacturing, 3-D printing, robotics, brain computer interfaces, hyper-supersonics, advance materials and advance surveillance technology such as face print and voice print.

According to its website, “The Bureau of Industry and Security (BIS) advances U.S. national security, foreign policy, and economic objectives by

ensuring an effective export control and treaty compliance system, and by promoting continued U.S. leadership in strategic technologies. BIS accomplishes its mission by maintaining and strengthening adaptable, efficient, effective export controls and treaty compliance systems, along with active leadership and involvement in international export control regimes.”

And while President Trump thanked General Motors Co, Toyota Motor Corp, Fiat Chrysler Automobiles NV, for “standing with” his efforts to bar California from setting its own vehicle emissions rules for cars and trucks, other automakers, such as Ford Motor Co, Honda Motor Co and Volkswagen AG, announced a voluntary deal with California on its emissions rule and are not joining the bid to intervene on the administration’s side.

Meanwhile, the White House, according to the Associated Press, plans to move ahead with plans for a single national standard for auto emissions. n

WINTER 2020 | Southern Automotive Alliance 29

INDUSTRY OUTLOOK Dealers are under pressure to move cars off their lots fast to make room for the following year’s models.

Sometimes, that means mark downs.

HARD SELL With sluggish sales and shifting consumer tastes, automakers, suppliers and car dealers are finding ways to cope.

TEXT BY: GAIL ALLYN SHORT

F

rom the start of 2019, the auto industry held its breath as analysts predicted new vehicle sales to dip that year.

The Edmunds Forecast and Trends report predicted new vehicle sales in 2019 to reach only around 16.9 million, down from about 17.2 million in 2018.

And by the summer, J.D. Power and LMC Automotive, in a joint report, predicted new vehicle total sales through the first half of 2019 to hit 8,396,500 units, a 1.8 percent drop from 2018, and new vehicle retail sales through the first half of 2019 to reach 6,477,400 units, 3.3 percent lower than in 2018. In a press statement, Thomas King, senior vice president of J.D. Power’s data

30 | Southern Automotive Alliance | WINTER 2020

and analytics division, said 2019 would likely see the weakest retail sales since 2013.

Gus Faucher, chief economist for PNC Financial Group says the robust sales in the past few years may be one reason for the expected slowdown.

“Americans have been on a car buying spree for the past four or five years and there are only so many new cars that people need,” says Faucher.

“I don’t think it’s necessarily a concern about the economy. I think there’s just less need now for new cars because sales have been so strong over the past few years.”

Americans’ reluctance to buy may be partly due to the rising prices of vehicles

in 2019.

Kelley Blue Book estimated in May the average price for a light vehicle in the United States to be around $37,185.

So while Americans are buying fewer vehicles these days, automakers, suppliers and car dealers, through hard choices, hard sells and persistence, are scrambling to manage the trend.

Shifting Consumer Tastes In times of weak vehicle sales, cutting production is one option for the automakers. Manufacturers, including Nissan, Honda and GM, for example, unveiled plans in 2019 to trim production at some of their plants.

But recently, domestic automakers

Ford Motor Co., Fiat Chrysler and GM have announced that they will phase out the production of passenger cars or sedans, which have fallen in popularity in the United States as more buyers turn to larger vehicles such as SUVs and pickup trucks.

In fact, even van sales are on the rise, according to LMC Automotive’s blog. It reports that van sales during the first half of 2019 rose an average of 4.2 percent compared to the same period the year before.

Jeremy Acevedo, senior manager of insights at Edmunds, says, however, that a lot of import automakers are keeping their passenger car business largely intact.

“For some of those automakers like Toyota and Honda, they’ve been able to rely on their sedan sales to sustain them,” says Acevedo. “They have a compelling crop of SUVs as well. But their cars still sell in decent quantities.

But the domestic manufactures had a tougher go in terms of sales, and they’ve made the decision by and large to minimize that as part of the business.”

Faucher said back in October that automakers had taken advantage of the rising demand for SUVs and trucks by boosting prices to increase profit margins.

As a matter of fact, the average price of a mid-size SUV in 2019 was $33,000, according to Kelley Blue Book.

“So obviously that’s having an impact on sales,” says Faucher. “If we’re to see more significant slowing of demand, then I think we would see the automakers respond by either reducing prices, offering more incentives or making smaller price increases for new models.”

Dodge Hellcats are among the more popular non-SUV choices made in the U.S. today

Dealer Dilemma For car dealerships, the pressure is always on to give customers what they want and to move inventory off their lots, speedily.

Dealers order their inventory direct from the manufacturer. To pay for the vehicles, dealers turn to banks that offer “floor plan financing” to obtain a line of credit.

To help dealers defray some of the costs, manufacturers offer factory-todealer incentives.

“When a new model year comes out, there will be incentives offered by the manufacturer,” says Thomas Dart, president of the Automobile Dealers Association of Alabama. “They want to stimulate the sale of the old models so they can sell more of the new ones.”

Once a dealer buys a vehicle, however, they own it until it is sold.

But buying too much inventory, or the wrong mix of vehicles, will cause a dealership to miss its sales and

revenue targets.

Therefore, to turn inventory as quickly as possible, a car dealer has to keep tabs on what is hot and what is not and balance their inventory to make sure they have the right mix of new and pre-owned vehicles and the models that buyers are demanding at the time.

So when vehicles are not selling, dealers have to keep marking down the prices until the vehicles sell, says Dart. That is because with the interest clock running, the longer vehicles sit on a car lot, the bigger the financial losses.

J.D. Power and LMC reported that in October 2019, the average number of days a new vehicle sat on a dealer’s lot before sale was 74 days through October 20. That is six days more than from the same month in 2018, the report says.

“You try to market cars as well as you can,” says Dart. “Sometimes

Americans have been on a car buying spree for the past four or five years and there are only so many new cars that people need. I don’t think it’s necessarily a concern about the economy. I think there’s just less need now for new cars because sales have been so strong over the past few years.—Gus Faucher, chief economist for PNC

Financial Group

WINTER 2020 | Southern Automotive Alliance 31

I N D US T R Y

O U TLO O K

Case in Point: NISSAN GROUP DOWN IN SALES FOR DECEMBER AND F O R 2019 O V E R A L L

By Erica Joiner West The Nissan Group announced total United States sales for December 2019 of 104,781 units, a decrease of 29.5 percent from the previous year. The group also announced total calendar year 2019 U.S. sales of 1,345,681 units, a decrease of 9.9 percent compared to 2018.

Nissan has four manufacturing facilities in the U.S., three in Tennessee and one in Mississippi. Of these, two are vehicle assembly plants and two are powertrain plants.

In the Smyrna Vehicle Assembly Plant in Tennessee, an annual production capacity of 640,000 vehicles roll off the lines, including Nissan Altima, Maxima, LEAF, Rogue, Pathfinder and Infiniti QX60.

In the Canton, Mississippi vehicle assembly plant, the company has a production capacity of 450,000 vehicles and produces the Nissan Altima, Frontier, Titan, Murano and NV Cargo and Passenger vans.

32 | Southern Automotive Alliance | WINTER 2020

You try to market cars as well as you can. Sometimes dealers have to really mark them down to move them. — Thomas Dart,

president of the Automobile Dealers Association of Alabama dealers have to really mark them down to move them.”

Supplier Survival For automotive suppliers, slower vehicle sales in the United States have had some impact, but the decline has not been significant, says Jeff Schuster, president, Americas Operations and Global Vehicle Forecasts at LMC Automotive.

“It’s more of a leveling off of sales right now,” says Schuster. “OEMs have been fairly disciplined in controlling inventory. The result is a more pronounced decline in North American production levels. Many suppliers have already been in a cost control mode and given the high level of uncertainty, they’ve put investments on hold for the time being.”

And Schuster says that while few

suppliers are specifically car-only suppliers, some companies supply a higher mix of passenger cars than others.

“They obviously would be impacted more with the shift,” says Schuster.

“That transition is not expected to reverse as we see SUVs and pickups continuing to gain market share.”

Auto Industry Hanging Tough At the end of 2019, Cox Automotive was forecasting the annual sales pace in November to be close to 16.9 million, up from 16.5 million predicted in October. Meanwhile a J.D. Power and LMC Automotive report predicted a seasonally adjusted annualized rate (SAAR) of 17.5 million units for the year, somewhat higher than the year before.

Analysts were also watching to see how well automaker GM’s sales would

bounce back following the company’s strike earlier in the year.

While GM, Ford and Fiat-Chrysler do not publish monthly sales data, several other automakers in November reported a boost in their total U.S., sales.

Total sales for BMW, for example, was up 10.2 percent over November 2018.

American Honda boasted of a November sales record with an 11.1 percent increase in total vehicle sales.

Other November winners include Hyundai Motor America with total sales up 9.2 percent over 2018 along with Kia Motor America at 12 percent, MercedesBenz U.S.A., at 13 percent and VW Group of America at 13.30 percent.

November 2019 sales for Toyota Motor Sales U.S.A., rose 9.2 percent compared to the same month in 2018, but its year-to-date sales dipped 1.4 percent.

The Nissan Group, however, took a particularly hard beating in 2019. The company saw its total U.S. sales for November plunge nearly 16 percent compared to the previous year. It was the third month in a row of total U.S. sales declines and the eight month of declines for the year.

Automotive News reported that Nissan was cutting back on its fleet shipments and incentives to support profits and its retail volume.

Faucher says he expects to see

vehicle sales of about 16.9 million units over the next couple of years.

While softer than in years past, he says, the numbers are still solid and the consumer fundamentals are strong with low unemployment, solid wage growth and falling interest rates.

“We’ve had sales of above 17 million units for the past four years,” Faucher says. “We’re likely to see sales close to that this year.”

Meanwhile Acevedo says he also calculates that vehicle sales are on pace to reach 16.9 million units in 2019 and that the figure is surprisingly strong for the year. And while this year’s GM strike impacted inventories, he says

that overall, 2019 vehicle sales proved stronger than auto industry analysts initially anticipated.

“I think in 2019 a lot of things we thought would be major inhibitors to sales are things the market navigated pretty gracefully, says Acevedo, “and how that would impact the auto industry trade wars.

“These things still loom large over the industry going into 2020,” Acevedo says. “But if 2019 has shown us anything, it’s that the industry has a way to kind of bob and weave and move around these things that we thought were going to be insurmountable obstacles for sales.” n

WINTER 2020 | Southern Automotive Alliance 33

INDUSTRY NEWS

Reliable Guidance?

A side impact test for the government’s safety rating system of one to five stars. (U.S. Department of Transportation/NHTSA photo)

Star safety ratings, long helpful to car buyers, now languish in the breakdown lane. The system hasn’t been upgraded to reflect new technology in years TEXT AND PHOTOS BY: ERIC KULISCH, FAIRWARNING.ORG

T

he federal government’s vehicle safety rating system is like grade inflation in school. It’s hard to know who is actually achieving.

Today, 98 percent of all vehicles tested receive four or five stars for crashworthiness. Consumer advocates and safety experts say it’s time to raise the bar for the New Car Assessment Program, which hasn’t been updated in nearly 10 years.

“There is no comparative value in the system anymore. It’s the equivalent of handing out candy at Halloween: Everybody gets some,” said Jason Levine, executive director of the nonprofit Center for Auto Safety based in Washington, D.C. The rating system was created 40 years ago as a tool to help car buyers make informed purchasing decisions and encourage automakers to exceed minimum safety standards. The program, managed by the National Highway Traffic Safety Administration (NHTSA), rates cars and light-duty trucks on a scale from one to five stars in crash and rollover tests. It’s a market-based approach– automakers hate bad publicity–that lets

buyers quickly compare the safety of new vehicles. The score is printed on the window sales sticker and more details can be found on NHTSA’s website.

The program has been successful in getting manufacturers to offer safer vehicles and incorporate enhanced safety features. But critics argue that it has not kept pace with advances in safety technology. Features such as automatic emergency braking and forward collision and lane departure warnings are not included in the ratings.

As a result, people are buying cars based on a decade-old measuring system and manufacturers aren’t incentivized to reach further for safety.

Over the years, NHTSA made tests more stringent, added new evaluation criteria and improved how results were shared with consumers. The agency appeared close to updating the rating system in 2016, but that seemingly changed under the Trump administration.

Responding to questions by email, NHTSA said that ”over the years, numerous improvements have been initiated to the program. Currently,

The very integrity and value of the 5-Star Safety Rating is undermined if the certification does not draw meaningful distinctions between the safety of different vehicles. It is also not meaningful if this safety certification fails to include crucial safety technologies already deployed on automobiles. —Rep. Frank Pallone 34 | Southern Automotive Alliance | WINTER 2020

NHTSA is considering various approaches to enhancing NCAP so that it will continue to provide useful comparative vehicle safety information.”

Sean Kane, president of Safety Research & Strategies, a research and advocacy group in Rehoboth, Massachusetts., said “the…program would be better served if there were a regular evaluation to it every few years.”

Diminishing Value When grades artificially skew higher in school because of easy assignments and lenient grading, students are typically less motivated and appear more high-achieving, while teachers look more effective than they are.

The same characteristics apply to automakers, who years ago figured out how to achieve a good safety score and simply apply the same template for each new model.

NHTSA spent nearly two years during the Obama administration trying to refine the program so that only truly exceptional vehicles received 4-and 5-star ratings. The proposal would have strengthened criteria for measuring crashworthiness, and added safety ratings for new crash avoidance and pedestrian protection features.

But the agency ran out of time getting approvals before the Trump administration took office and “couldn’t

Mark Rosekind, administrator of the National Highway Traffic Safety Administration, during the Obama presidency.

(U.S. Department of Transportation/NHTSA photo)

quite get it over the finish line,” Mark Rosekind, the NHTSA administrator at the time, told FairWarning.

Under President Trump, NHTSA’s proposal stalled. In September 2018, it held a public meeting to gather stakeholder input but the notice signaled little interest in following the Obamaera recommendations. It mostly sided with industry concerns raised in 2015 over program and technology costs, and whether there was sufficient data showing any changes would provide meaningful benefits.

Since then, NHTSA has remained silent about next steps.

At a hearing in May, Rep. Frank Pallone (D-NJ), chairman of the House Energy and Commerce Committee, criticized NHTSA agency for letting the rating system stagnate.

“The very integrity and value of the 5-Star Safety Rating is undermined if the certification does not draw meaningful distinctions between the safety of different vehicles. It is also not meaningful if this safety certification fails to include crucial safety technologies already deployed on automobiles,” such as forward collision warning, lane departure warning and blind spot detection, he said.

Automaker Indifference There is no apparent urgency at NHTSA to update the ratings system, with a White House that tends to side with business on nearly every issue and

unwinds Obama-era policies with zeal, especially when the auto industry seems indifferent about reform.

Automakers generally have been lukewarm about the rating system because it challenges them to compete on the basis of an independent, unbiased safety assessment. Manufacturers that provide advanced safety features currently don’t receive any benefit in the rating system compared with rivals who withhold such systems from consumers.

Companies that are out front developing technology are happy to boast about it, but the rest are nervous about any change, according to Rosekind and Will Wallace, manager of safety policy at Consumer Reports. And many prefer maintaining NHTSA’s current system of recommending certain crash avoidance technologies to consumers rather than testing and rating them.

A handful of manufacturers, notably Honda Motor Co., voiced general support for significant upgrades during the Obama administration, according to official comments submitted by trade associations and individual firms.

The Association of Global Automakers, representing foreign brands in the U.S., last year offered qualified support for NHTSA’s earlier proposal, while the Alliance of Automobile Manufacturers, a trade group for a dozen vehicle makers, said the recommendations were not ready yet.

“It is important that any new additions to [the rating system] significantly increase real-world safety.

If not, they will only increase vehicle cost without any commensurate realworld safety benefit,” the Alliance told NHTSA. The program “should avoid forcing differentiation for differentiation’s sake. ” Auto Alliance spokesman Wade Newton said the group agreed with NHTSA’s withdrawal of the 2016

proposed updates “since they lacked valid test procedures” and adequate proof of benefits.

The government affairs offices of Honda Motor Co, Toyota North America, Mazda USA, General Motors and Hyundai Motor Co either did not respond to requests for comment or referred questions to the two trade groups. Hyundai vehicles already perform at higher standards in thirdparty safety evaluations. spokeswoman Laura Bonavita added.

No Urgency The ratings system isn’t challenging enough for car shoppers to trust right now, Wallace said.

“When almost every car gets a four or five-star rating it makes it almost impossible for consumers to tell which vehicles actually provide a betterthan-average level of safety, or a lower level of safety,” he said. “And that’s tremendously concerning to us because this is a program that has tremendous power when it is at its best.

“It was so successful it was emulated around the world,” but now “has been allowed to languish. And that is such a shame, not only for consumers, but for everyone on our roads.”

Wallace blamed leadership at NHTSA and the Department of Transportation, for not pursuing upgrades. And, he suggested, there are signs of a possible split among senior NHTSA officials about the value of the star ratings in an era when the private sector, through organizations such as the Insurance Institute for Highway Safety and Consumer Reports, already rate vehicles for safety.

Those groups can supplement NHTSA’s work, but should not be a substitute for comprehensive, impartial evaluation conducted by the government, Wallace stressed. n

It is important that any new additions to [the rating system] significantly increase real-world safety. If not, they will only increase vehicle cost without any commensurate real-world safety benefit. —Alliance of Automobile Manufacturers WINTER 2020 | Southern Automotive Alliance 35

EDUCATION

A collage made of images submitted to Kia by winners of the automaker’s The Great Unknowns Scholarship. Courtesy Kia Motors America

Rewarding Excellence The Great Unknowns funds scholars instead of celebrity Super Bowl ad TEXT BY: CARLA CALDWELL // PHOTOS COURTESY: KIA MOTORS AMERICA/JAMES MCWHORTER

A

s Kia Motors America was planning its February 2019 Super Bowl ad, the automaker made what might be a surprising choice to forgo hiring a pricey celebrity spokesperson to promote its new Telluride mid-size SUV. Instead, Kia opted to air a 90-second spot featuring people and places in West Point, Georgia, the home of Kia Motors Manufacturing Georgia, which assembles the Telluride, Optima and Sorento models; and to create a scholarship to assist outstanding students.

The city of approximately 4,000 people is about an hour and 15 minutes southwest of Atlanta. The ad focuses on residents’ values, work

36 | Southern Automotive Alliance | WINTER 2020

ethic and perseverance, and the pride that goes into making each Kia. The spot launched the company’s “Give it Everything” marketing campaign, which, along with promoting vehicles, invited students to apply for “The Great Unknowns Scholarship.” The scholarship recognizes students who embody Kia’s “give it everything” spirit, the company noted.

More than 5,000 students applied.

Sixteen students were selected based on academic performance, extra-curricular activities, and how they make a difference within their

local schools and communities.

The scholarship provides students $5,000 each year for four years, with the stipulation that high academic standards are maintained.

“We are honored to help these talented and ambitious students further their education and we’re excited to see what their futures hold,” says Michael Cole, president, Kia Motors America.

The scholarship recipients attend schools throughout the U.S. and participate in myriad fields of study.

Not every student is pursuing an

We are honored to help these talented and ambitious students further their education and we’re excited to see what their futures hold. — Michael Cole, president, Kia Motors America.

The result of excellence is never an accident, but the result of high intention, sincere effort, intelligent direction, skillful execution, and the vision to see obstacles as opportunities. —Daniel Guzik, electrical engineering major at the

University of Texas at San Antonio

automotive career, but they all want to utilize their talents to benefit their communities and beyond.

For example, scholarship winner James McWhorter, 18, of Cullman, Alabama, is majoring in aerospace engineering at the University of Alabama in Huntsville. He’s considering a career in either the aerospace field or automotive engineering.

In addition to the Kia award, McWhorter received a merit scholarship based on exceptional ACT scores. He’s a major proponent of STEM programs, which integrate science, technology, engineering and math. His Kia scholarship application notes that he wants to promote the importance of STEM programs and help make them available to students in elementary through high school.

McWhorter is grateful to be among the Kia scholarship’s first recipients. “I want to thank Kia. The scholarship means a lot to me. I am working hard and hope eventually to be the CEO of an engineering technology company. I would like to be successful enough to create a scholarship to help others.”

Kia scholarship recipient Daniel Guzik, of San Antonio, Texas, who attends the University of Texas at San Antonio, says he values hard work.

“The result of excellence is never an accident, but the result of high intention, sincere effort, intelligent direction, skillful execution, and the vision to see obstacles as opportunities,” Guzik says in his scholarship application.

Kia plans to award more scholarships in 2020. Applications will be accepted early in the year. For more information go to www. thegreatunknowns.org. n

I want to thank Kia. The scholarship means a lot to me. I am working hard and hope eventually to be the CEO of an engineering technology company. I would like to be successful enough to create a scholarship to help others. — James McWhorter,

aerospace engineering major at the University of Alabama in Huntsville

Winners of Kia’s The Great Unknowns Scholarship CHRISTINE AHN — Hometown: Seoul, Korea; College: University of California, Berkeley; Major: Material Science and Engineering.

CINDY CHAU — Hometown: Philadelphia, Pa.; College: Tufts University; Major: Engineering.

DANIEL GUZIK — Hometown: San Antonio, Texas; College: University of Texas at San Antonio; Major: Electrical Engineering.

CHANCE JEWELL — Hometown: Ripley, W.Va.; College: University of Southern California; Major: Engineering.

HONG JI LIU — Hometown: Hampton, Va.; College: Duke University; Major: Aerospace Engineering.

WINNIE LU — Hometown: Osprey, Fla.; College: Duke University; Major: Biomedical Engineering.

JAMES MCWHORTER — Hometown: Cullman, Ala.; College: University of Alabama in Huntsville; Major: Aerospace Engineering.

JAMAL NIMER — Hometown: Chicago, Ill.; College: Stanford University; Major: Public Policy.

JACOB RHOADES — Hometown: Jamestown, Pa.; College: University of Pennsylvania; Major: Economics.

CESAR ROBLES — Hometown: White Salmon, Wash.; College: University of California, Berkeley; Major: Electrical Engineering.

SAR AH SCHAEFER — Hometown: Stafford, Va.; College: University of Southern California; Major: Biomedical Engineering.

MUHAMMAD SHAIKH — Hometown: Brooklyn, N.Y.; College: Harvard University; Major: Neuroscience.

ISABELL A SIU — Hometown: Miami, Fla.; College: Cornell University; Major: Electrical Engineering.

MYKY TA SOLONKO — Hometown: Glenview, Ill.; College: Yale University; Major: Computer Science.

AEDAN WELLS — Hometown: Aztec, N.M.; College: New Mexico Institute of Mining and Technology; Major: Computer Science.

PATRICK YANG — Hometown: La Palma, Calif.; College: University of California, Los Angeles; Major: Chemical Engineering.

Scholarship recipient James McWhorter, of Cullman, Alabama, who is studying aerospace engineering at the University of Alabama in Huntsville. Courtesy James McWhorter WINTER 2020 | Southern Automotive Alliance 37

Vince Green of Limestone County Career Technical Center leads a program designed to show students they can be on track toward a career as soon as they want to be.

38 | Southern Automotive Alliance | WINTER 2020

WORKFORCE DEVELOPMENT

Dual Control Joint venture between Mazda and Toyota leads to educational outreach and opportunity TEXT BY: CARA D. CLARK // PHOTOS BY: JOE DE SCIOSE

M

ark Brazeal, vice president of administration for MazdaToyota Manufacturing U.S.A, believes in the power of opportunity and opening doors for young people and the underemployed. In preparation for the 2021 opening of the manufacturer’s $1.68 billion plant in Huntsville, Alabama, Brazeal is spearheading an innovative approach to hiring.

“One task we have to focus on at Mazda-Toyota is educating the community,” Brazeal says. “We are explaining to high school counselors and others that we have opportunities from skilled labor to production to accountants to engineers. We’ve already started collaborating with high schools and career technical centers.

We want to engage with educators so they understand these opportunities and inspire students at an early age – when they are in middle school and high school – about the career opportunities.”

Those students “can aspire to a career with us,” Brazeal explains. “We expect to hire 4,000 people at MazdaToyota Manufacturing with 1,500 to 2,000 more working on campus at our on-site supplier.”

Mazda-Toyota planned to hire those 4,000 people by January 2020, and with a competitive labor market, the company is purposefully building a team of well-prepared employees.

Part of the process is “a day in the life” simulation.

“This allows prospective candidates to understand what they would have to do on a daily basis and determine if it’s something they would want to do,” Brazeal explains. “It’s a hands-on

assessment. We want people who work hard, are dedicated and willing to learn.”

Brazeal’s leadership in the new joint venture is multi-faceted, including human resources, safety, production control, environmental, accounting and external affairs.

“We were highly interested in starting this even before we were in full production,” Brazeal says. “We currently have 15 co-op students – we have no plant yet, but we have the students, and we are using them to install equipment at Limestone Career Technical and Drake Tech. By early next spring, they will be installing equipment in the plant.”

The equipment in educational facilities will train other students before the plant begins production in 2021 on a Toyota SUV and a Mazda SUV, both new to the manufacturers.

When Mazda-Toyota opened an application window for a limited number of team leader jobs for one week, more than 2,000 applicants signed up.

“We not only have a new plant with new team members, we’re producing new brand models, as well,” Brazeal says. “When you talk about motivation and excitement, there’s a lot of both around producing two new models for American car buyers. We expect when

we really go into mass production here in early 2020, we will legitimately have tens of thousands of applications.”

By hiring prepared and committed workers for both lines of manufacturing, Brazeal says it’s clear that Alabama, already an automotive powerhouse, is poised for even more growth.

“I certainly envision we are the type of company that everybody is proud to have in their North Alabama community,” Brazeal says. “My dream is to see people start with Mazda-Toyota Manufacturing and being able to grow their careers – I want to see production team members grow into leadership roles. It will be a key focus for us to grow, develop and nurture key talent.

“Hopefully, we’ll continue to grow the organization and diversify our product lineup beyond just the two we will be producing in 2021.”

The new plant is expected to produce 150,000 units each of Mazda’s new crossover model and a new Toyota SUV. To assemble two different cars in one location will require a diverse set of skills, and Brazeal is partnering with area educators to find the right employees.

“We have a very fair evaluation process to be able to assess candidates relative to the skills we need,” Brazeal

The most important part is showing students in our area what is out there as far as jobs they could get when they graduate from high school. While in high school, they can get great credentials on their resume before college, and they can have technical as a back-up plan. Our sole purpose is having partnership with industry leaders to help guide us on curriculum and instruction to get skill sets in place to help our students get jobs — Vince Green WINTER 2020 | Southern Automotive Alliance 39

WO RKF O R C E

D E V ELO PME NT

says. “It also gives (candidates) an opportunity to assess us to see if this is something they like.

“We are doing multiple activities in parallel as we try to learn from what other Toyota plants in the U.S. have done with high schools and community colleges,” Brazeal explains. “We are benchmarking what other automotive companies in this state are doing and taking all of that knowledge to develop our own strategies.”

The collaborative benefits are clear in working with area schools.

The partnership includes Calhoun Community College and Limestone Career Technical, both offering multiple career pathways supporting workers for Alabama’s growing auto industry.

“We’re working to launch a skill certification program for any student interested in a technical job,” Brazeal says. “That allows students in high school to go straight from school to a job.”

Calhoun Community College, in Tanner, Alabama, offers work experience through a co-op arrangement, establishing pathways for production and skilled labor employees.

When Brazeal worked with the Toyota engine plant in 2002, he collaborated with Calhoun to launch its program from the ground floor.

Jeff Lynn, vice chancellor for workforce and economic development for the Alabama Community College System, also met with Mazda-Toyota representatives.

“We talked about programs to help prepare applicants,” Lynn says.

“One way we did that is to introduce certification programs for the operators with the Manufacturing Skills Standards Council.”

Students who go through the MSSC certification’s four modules, Safety, Quality, Production and Maintenance, and pass all four, become certified technicians, a big boost on the career path.

“That really raises the bar for people who are applying and gives them a good baseline safety standard,” Lynn says. “It 40 | Southern Automotive Alliance | WINTER 2020

One task we have to focus on at Mazda-Toyota is educating the community. We are explaining to high school counselors and others that we have opportunities from skilled labor to production to accountants to engineers.

— Mark Brazeal

takes time to get through the course, but we offer certification in all colleges in the state.”

Lynn says the program also is being rolled out to high schools and being offered as a dual enrollment option.

“High school students can get college credit,” he explains. “If they desire to go to community college, they can continue to maintenance or mechatronics.”

That program is part of ramping up the state’s FAME (Federation for Advanced Manufacturing Education) program, a model begun by Toyota in Kentucky in the early 1990s and formalized in 2010. It has grown to 11 states, with a chapter at Calhoun Community College.

“All of us were working together to create a really robust workforce pipeline for them. We are rolling it out to as many community colleges as possible,” Lynn says.

Brazeal says he has been working closely with Vince Green, head of Limestone County Career Technical Center for several months.

“I’m excited about things he is launching there,” says Brazeal, who plans to broaden the reach to Wallace State, Drake State and other community colleges. “He definitely has a vision for his school.”

Green says it’s important for area high school students to understand the jobs available when they graduate.

“While in high school, they can get great credentials on their resume before college, and they can have technical as a back-up plan. Our sole purpose is having partnership with industry leaders to help guide us on curriculum and instruction to get skill sets in place to help our students get jobs.”

Green says he sees a definite paradigm shift as students, parents, counselors and manufacturers realize the promise in partnerships.

“When I was in high school, you went to career tech because you couldn’t go to college,” Green says. “Now that has changed. We want you to go to college if you want that, or we want you to go straight to work if that’s what you want.

As more people understand that, we’ve overcome a huge obstacle in getting quality students in our program. We’ve really changed the mindset of parents with career tech. Students can come to our school and get career credentials with high-paying jobs and benefits packages.”

Lynn says the demand for industrial team members is huge.

“We have to increase the capacity we are doing at the community college level to meet these demands,” he says.

“The key thing for us at the community college system is to listen to what companies need and to start educating students as young as possible.”

“Mark is very, very interested in helping out the underemployed, young students, military student,” says Lynn.

“I think that is exciting. Mark really wants to make an impact and help us help people change their lives. That’s really a wonderful thing—helping people who did not know about an opportunity to get a great career with a great company.” n

VISION

Design or Process?

An Auburn University professor argues that Southern manufacturers and schools should concentrate on what makes the most sense for the region’s car plants TEXT BY: TOM DEVALL, AUBURN UNIVERSITY

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hould the southern automotive community commit time and effort focused on product design?

A case for removing all consideration for product design in the southeast can be made. If process design were the sole emphasis, how might four-year research institutions target their efforts to engage the automotive industry?

The incredible growth of automotive in the southeast should result in robust relationships with fouryear research institutions. However, this has not happened to the extent expected. Where there has been significant focus on product design by

four-year institutions, can we point to design work that has been incorporated into the final product?

Four-year universities have a strong interest in developing relationships with the growing automotive industry in the southeast. While funded projects are most desirable, unfunded relationships such as Senior Design [programs] present an opportunity to provide students with “real world” experience.

A common strategic mistake by four-year universities pursuing engagement with the automotive industry here in the southeast is the focus on product design vs. process design. Failure Modes and Effects

Analysis (FMEA) is a common industry process used to evaluate vulnerabilities with product quality and throughput.

FMEA analysis has two distinct focus areas; process (PFMEA) and design (DFMEA). These two areas of focus comprise all considerations of risk for product quality and throughput. There is great opportunity for universities to develop relationships with the automotive sector within the realm of process vs design.

There are several barriers preventing southeastern universities from participating in the product design realm. Barriers include:

• Southern automotive manufacturers have very little to no responsibility for design. The design studios are in California, Michigan, Germany and South Korea.

• Automotive manufacturers are

very protective of their proprietary product designs for competitive reasons and therefore unlikely to provide access.

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Southeast consortiums and organizations that support automotive manufacturers may focus too much time and energy on design, the area they cannot impact.

• Authority to enter into legal

contracts with local universities will likely require legal review and approval from corporate locations not typically located within plant sites.

• The rigor and experience required

for design is significant. While researchers can and do support innovation that affects final product design, it is not likely universities can participate in the design realm at any significant level.

• Design is “locked” when a vehicle

goes into production and may only see minor changes for the life of model, while process changes continuously.

Southeast consortiums and organizations that support automotive manufacturers may focus too much time and energy on design, the area they cannot impact. One could argue, consortiums and support organizations should consider eliminating all discussion and effort focused on design, freeing up time and energy to be exclusively focused on process, the area they can impact. The customer is and should be the automotive manufacturing plants. What would be the impact of a support organization’s relevancy with such focus?

Automotive plants have great interest in process. This is clear based upon state agreements that include 42 | Southern Automotive Alliance / WINTER 2020

workforce training when luring companies to locate in their states.

Training typically focuses on the twoyear community college system and other state institutions such as AIDT in Alabama. Plants located in the southeast have significant opportunity for process improvement, which their management teams have primary responsibility to solve.

In the 2001 book by Jeffrey Liker, The Toyota Way, Toyota identifies two primary principles of the Toyota Production System, a system all automotive manufacturers work to approximate. The two principles are Respect for People and Continuous Improvement. Great companies understand that “we make people before we make cars.” Great companies develop problem solvers in pursuit of manufacturing perfection, which is a continuous pursuit. The continuous pursuit of perfection at the plant level is strictly focused on process. Although all plants go through launch and adjust process throughout the launch period, there remains significant ongoing improvements that must be made to maintain competitiveness and to move toward perfection. Although perfection is unattainable, it is the objective, hence the ubiquitous discipline of continuous improvement within the automotive industry. All plants have significant opportunity to solve process issues.

While a robust relationship with universities will result in accelerated process improvements, a benefit that may be of greater significance is the human supply chain of future manufacturing leaders. Future leaders will not likely come [directly] from the two-year college system as HR hiring restrictions require four-year degrees for management positions.

Training of two-year students does not include course work that prepares

the student for leadership positions.

Manufacturers don’t appear to have a long-term strategy of developing future leaders. This short-term thinking is an opportunity missed.

Within the Industrial and Systems Engineering (ISE) department of Auburn University, there are several initiatives designed to address the process needs of the automotive industry.

Auburn’s ISE focus has led to significant levels of funded research from past and ongoing grants with automotive industrial partners.

Our strategy of focusing on process vs product design has improved our relationship with automotive, aerospace and healthcare companies.

There is significant innovative research being conducted within all colleges of engineering that apply to process.

Areas of research include advanced machining, friction stir welding, powdered metal 3D printing, bio energy, cyber security and robotics, to name a few.

Design-focused education is both vital and necessary to develop future engineers. Both design and process education are fundamental to engineering education. This article is focused on strategies to engage the southeastern automotive industry.

Industrial engineering is a discipline that is well-aligned with process design.

Four-year universities and automotive industrial companies in the southeast should consider the common area of process vs. design to develop healthy flourishing relationships that include the development of plant future leadership teams. n Tom Devall has over 20 years of experience in the automotive manufacturing industry. And currently serves as the director for Manufacturing Initiatives at Auburn University.

EXPERT VIEW

Navigating Uncertain Times

Key Takeaways from the Southern Automotive Conference TEXT BY: MICHELE REDMON AND DAVID EYES

Editor’s note: With SAC 2019 in the rear view, David Eyes, automotive expert for DiCentral, and his colleague Michele Redmon offered some insights from the latest edition of the industry event. The article is taken from the DiCentral blog and used with permission.

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he automotive industry is in the midst of a transformative era and, accordingly, that was a prevalent talking point at the recent Southern Automotive Conference in Nashville, Tennessee.

Profit margins are thinning, jobs are disappearing, and political conflicts continue to make operating a global automotive supply chain more challenging.

In previous years, the focus of the Southern Automotive Conference seemed to be on innovation and new technology. The focus at the 2019

conference shifted from speculation on future innovations to ensuring that manufacturers are agile enough to support the current challenges in the industry.

Here are the key takeaways from the event.

Automotive Manufacturers Are Grappling With Geopolitical Uncertainty Fifty years ago, US automakers like Ford, Chrysler, and GM operated out of factories and warehouses within the country. As they lost market share to foreign entities and

began aggressively cutting costs, they expanded their reach. Automakers began to shift their focus from US factories to markets abroad, where they were able to assemble vehicles at lower costs and source cheaper parts from manufacturers in Mexico or Asia. Today, rather than physically assemble or carry their products, most automakers only source the necessary materials to produce parts from around the world, which makes recent geopolitical events even more of a headache for those in the auto industry: • US-China Trade War: The situation in China initially began when US President Donald Trump accused China of unfair trading practices and intellectual property theft. Meanwhile, China’s perception is that the US government is simply fearful of the growing power and reach China holds. Thus far[as of September 2019], the US has imposed tariffs on more than $360 billion WINTER 2020 / Southern Automotive Alliance 43

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significant toll on car manufacturers, and will likely continue to do so for the foreseeable future. However, the general consensus at the Southern Automotive Conference was that the challenges could be treated as opportunities for those manufacturers willing and able to make positive changes within their organization’s infrastructure.

Attorney Jan De Beer of Frost Brown Todd outlined how the global outlook for trade and tariffs are expected to impact the automotive sector at the Southern Automotive Conference in Oct. 2019.

of Chinese goods, and China has retaliated with tariffs on more than $110 billion on US products. While negotiations have continued, the situation seems to be that of, “two steps forward, three steps back” with very little positive progress being made. With no definitive end in sight, many car manufacturers that work with suppliers in China are left wondering if they should find new suppliers in other countries or simply wait the trade war out.

• Japan-South Korea Trade War: While the conflict between China and the US has inflicted significant damage to the global economy, the animosity between Japan and South Korea seems to signal even more troubles ahead.

Japan and South Korea have essentially been at odds since WWII, when Japanese forces occupied the Korean peninsula and forced residents there to work for them. In 2018 South Korea’s Supreme Court ruled that several Japanese companies still owed South Korean residents and their families additional reparations. The Japanese government has refused this claim, asserting that the matter was 44 | Southern Automotive Alliance / WINTER 2020

settled by a 1965 treaty. The two sides retaliated against one another with restrictions on trade. Many residents in South Korea have begun boycotting products manufactured in Japan, including Japanese cars, with petrol stations refusing to service Japanesemade vehicles.

• Brexit: In 2016, a public vote was held to decide whether the UK should leave or remain in the European Union (EU). The majority of voters opted to leave, but four years later no agreement has been reached between the UK and other EU countries to outline the terms of their withdrawal.

If no deal is made and the UK leaves as scheduled (January 2020), then the EU will start carrying out checks on British goods. This could lead to delays and disruptions to supply routes and a possible drop in the pound (UK currency), resulting in a potential recession. In fact, UK auto production has already dropped by a fifth, with automakers spending more money on Brexit contingency plans than the technology they need to survive in the current global market.

These conflicts have taken a

Lower Tier Suppliers Need to Adopt Cloud-Based Supply Chain Management Tools How many cloud-based applications do you use each day? If you have a smartphone, probably upwards of 10 or 20. The reason for the prevalence and popularity of these apps is simple - They make life easier. While some holdouts still express hesitancy when it comes to using similar cloud-based technology to manage their supply chain, more organizations than ever are making the move to the cloud.

OEMs and Tier 1 suppliers have largely already adopted automated and integrated cloud-based supply chain solutions. These larger organizations operate with help from a number of different kinds of software, including EDI, CRM, ERP, WMS, etc*. While each program automates a specific workflow, a cloud-based integration ensures the real-time flow of data between cloud solutions, meaning that designated parties can access updates, alerts, inventory and order information from any computer or smart device with an internet connection.

The real room for improvement lies with Tier 2 suppliers and below, that have yet to upgrade their processes.

Some still use Excel spreadsheets to track inventory and orders, making visibility a serious issue. This is never more apparent than in the event of a recall, when manual supply chain processes require manual investigation and research in order to identify the problem, whether it lay in the design, material, or the component itself.

This significantly slows the reaction time and prolongs the recall process,

contributing to profit loss, damage to the company’s reputation, and increased legal liability.

Just-In-Time (JIT) fulfillment has become the gold standard in the automotive industry. Using the JIT model, automakers do not store any inventory. When a customer makes an order, they immediately purchase the parts from their manufacturer(s).

Inventory visibility is fundamental for JIT, since you must have realtime insight into stock levels in order to relay a realistic delivery time.

Organizations that still use manual data entry and order processing techniques spend more time and resources on processing orders and experience an increased incidence of errors, often resulting in chargebacks or costly delays. Organizations that use cloud-based supply chain solutions are better able to track inventory and comply with the specific requirements of each automotive trading partner, including EDI, automotive industry communication protocols, barcode label printing, and business rules.

OEMs and Tier 1 suppliers in the current market must be incredibly efficient and able to get products

to the market very quickly. If lower tier suppliers fail to adopt more efficient cloud-based supply chain management solutions, these bigger, more technologically savvy organizations will simply select a supplier that can comply with more modern, automated systems. Strategies such as data integration into ERPs or other back-office systems and JustIn-Time (JIT) enablement allow for streamlined supply chain management, empowering small and mid-sized suppliers by creating a more level playing field.

Consumer Focus Has Shifted From Autonomous to Eco-Friendly Vehicles Within the span of just a few years, autonomous cars evolved from a futuristic fantasy to an on-the-road reality. While efforts to research the possibility of self-driving vehicles began as far back as the 1980s, the technology hit a new stride after Toyota announced their automatic parallel parking assistance feature. Many other automotive manufacturers adopted similar technologies, and by 2013, key automotive players, such as Google,

Yuri Unno (l), director of International Trade Policy, Government and Industry Affairs for Toyota Motor North America, and Leila Aridi Afas (r) director of International Public Policy for Toyota Motor North America spoke against U.S. tariffs that are expected to impact automotive manufacturing at SAC2019.

Tesla, General Motors, Uber, Ford, Mercedes Benz, and BMW, were all working on their own autonomous vehicle technologies.

In the race to be the first to achieve full automation, automakers may have taken more risk than was appropriate, evidenced by the fact that both Uber and Tesla autonomous vehicles have been involved in six fatal crashes in the past four years. While these tragedies seemed to dampen some of the excitement around autonomous vehicles, the events coincided with growing fears about climate change, which resulted in a consumer shift in interest from autonomous to electric cars.

A recent analysis by Bloomberg New Energy Finance found that electric cars could make up 57% of all passenger car sales worldwide by 2040.

Gas-powered vehicles seemed to have passed their peak, with manufacturing of automotive parts shifting to focus on electric car components. While autonomous vehicles will likely continue to grow in popularity, today’s consumers seem less concerned with who’s driving and more interested with what’s powering the vehicle.

Take Advantage of the Slow Down Imagine a Formula One race. After the vehicles cross the starting line, gaps quickly form between them. If an accident occurs, the race grinds to a halt, with all the vehicles keeping a slow, cautious pace behind the safety car. Yet, where many view the slow down as an insurmountable challenge, innovative manufacturers are taking advantage of the down time, making positive changes and implementing new technology so that when the time comes to step on the gas, they’ll be leading the pack. n DiCentral, formerly known as Data Interchange, is a leading global provider of EDI* and supply chain solutions headquartered in Houston, Texas.

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Faces of the Industry

Have Mission - Will Travel I just started getting to a place where I needed more balance in my life, and I wanted to find something else that I was passionate about.”

TEXT BY: NICK PATTERSON // PHOTO BY: JOE DE SCIOSCE PHOTOS COURTESY: LISA HARRIS BOYD

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t the Southern Automotive Conference Lisa Harris Boyd serves as the stage manager, and earlier this year she was somewhere in the middle of the three day event being held in Nashville, Tennessee when she got a call in the middle of the night.

Actually, she got two calls. One was from Dubai. The other was from London, England.

Both were emergencies and neither had anything to do with the Southern Automotive Conference, although they both were transportation related.

One call was from a woman in 46 | Southern Automotive Alliance / WINTER 2020

Dubai who had broken her foot and needed to be transported back to the U.S. The other call was from a couple traveling in London, on their way by train to Paris, who needed to fly back to America because of a family emergency.

The reason they called Boyd?

In her regular job — the one she does between the annual editions of the Southern Automotive Conference — Boyd owns and operates Life Is Short Adventures, a Birmingham, Alabamabased travel planning and consulting business. The emergency calls were from clients who she had set up for

dream getaways, trips that suddenly threatened to turn into nightmares — in the middle of the night here in the States.

But did that throw Boyd? Nope. Not even at 2 a.m.

“So, the client in London…I had to cancel her train trip – or attempted to cancel her train trip – I cancelled her hotel, everything. She was leaving to go to Paris so I cancelled all of her Paris activities and got her on the next flight out of London to come home because her mother-in-law had gotten admitted to the hospital and the family was called to come home,” Boyd relates.

“Thankfully I had offered her travel insurance and she had accepted it, so all of the expenses and all of the cancelled things …were all refundable because of the travel insurance. But I had to work that night to get her home and cancel as many things as I could.”

The client in Dubai with the broken foot turned out to have less of an immediate need to get out of the country, Boyd says. “She ended up staying another couple of days. But that’s another benefit of having a travel advisor work with you is that when those emergencies come up, you don’t have to worry about it, you just kind of sit back and let somebody else deal with the stress of taking care of all those details.”

Boyd took it all in stride. “It was from 2-4 a.m. I was dealing with the travel emergencies, and then 6 a.m. I had to wake up for the SAC to be there by 7,” she says, laughing at the memory.

“But it was great. Still it was fine. I wasn’t even sleepy that day…I guess I

I think it’s really important for us as individuals to experience new cultures and see new things and get out of your comfort zone. It helps us be better people. just don’t need as much sleep. I don’t know. I’m both a morning person and a night owl.”

Most folks at SAC2019, including the speakers Boyd had to prep and get onto and off the stage for presentations, had no idea she was operating on four hours of sleep; her professionalism never cracked. That might not be surprising if you consider that she’s a lifelong traveler, whose biggest journey among many was from busy ad executive to single mom to entrepreneur, among other things.

advertising, and I loved everything that I was doing there.

“So I did some soul searching, and over many, many months I tried to figure out what it was that I loved and what I wanted to do and where my strengths and skills were. My background in advertising, focusing on attention to detail and client service — I was trying to really focus on how I could use those in other areas that would allow me more flexibility to be a mom and to be with my kids when they needed me to be.”

The Journey Boyd, then Lisa Harris, worked at Birmingham-based advertising firm o2 Ideas for 17 years. She was the company’s director of client services when o2 managed the SAC, and found herself acting as stage manager. Even when management of the conference transferred to PMT Media & Events (PMT Publishing is the parent company to this magazine), Boyd remained stage manager for the yearly event.

Already at that point, she was a single mother raising two kids; a few years earlier, her husband Scott Harris, who had been senior art director at o2, died of brain cancer. “I then found myself as a single mom with two young kids, seven and nine at the time. And I was just working long hours, and I had to miss some things related to their — school activities just because my schedule wasn’t always super flexible — although o2 was always very accommodating and it was flexible up to the degree that I allowed it to be,” she says.

“So after doing that for three years — full-time single mom, full-time plus many hours working — I just started getting to a place where I needed more balance in my life, and I wanted to find something else that I was passionate about because I always loved

Family Adventures That thought process took her back to her childhood exploring the country in a motorhome. “I grew up traveling with my parents. With my parents I went to 49 states, and I saved the 50th state to go with my husband,” she says.

“My parents were both raised in

poor families, they both didn’t have a lot of money growing up, and travel was the one thing that they always wanted to do. So they would save their money all through the year, and travel is what they spent money on. My dad would always buy a new motorhome, fix it up, and we’d take a big trip. And he’d sell it, buy a new one, fix it up…and the profit from the motor homes also kind of helped fund some travels. They both were with their companies for 20 plus-years, 25 years, so … they had built up a lot of vacation, and they saved it for the summer so we always took a big summer trip.”

Those experiences stuck with her.

“I’ve just always loved traveling. I love planning trips, and I came up with the idea of starting this company, Life is Short Adventures, and I started it just to kind of find a different niche outside of what traditional travel agents do.”

Leaving her corporate role for an entrepreneurial one was triggered by a book, she notes. “Chip Gaines — his book Capital Gaines ­— is what actually

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convinced me to take the leap,” she says.

“I was listening to the book on Audible, and one day I was driving home from work for lunch, and I was at the very last chapter of his book and it was in the car, and he said, ‘You know that thing that you’re passionate about? That thing that you really want to do? Don’t wait.

Just go ahead and take the leap and do it. You’ve got it within you to make it 48 | Southern Automotive Alliance / WINTER 2020

work.’ And I walked into my house, called my financial planners, turned around – didn’t even eat lunch – turned back and went to o2 and resigned.”

Pretty soon, through word of mouth and social media, Boyd had a number of clients. She’s motivated by her own experience to help that growing group take the leap into travel - and not put it off until later.

Boyd’s experience: She had not only lost her husband at age 45 to brain cancer, but she had lost her father the same way when he was 53.

“Life is short,” she says. “You know, one day your life can change forever and then you may have regrets of things that you didn’t do in life… So my motivation is to help people make their travel dreams come true, so that they actually do them and don’t put them off until retirement, because we’re not guaranteed retirement.”

Now officially a travel advisor — she works with a company called Andavo — Boyd sends clients all over the world, and has even finds plenty of time to travel the globe with her now teenage daughters. Earlier this year, she got remarried — to Mason Boyd — and now has a third child at home, her stepdaughter.

Boyd has already traveled to her 50th state — Hawaii — with her new husband — just as she had with her late husband Scott. Having traveled to all six major Hawaiian islands, she is now recognized as a destination expert, certified by the Hawaii Tourism Authority.

“Hawaii is a special place for me. I mean, it was my 50th state and I fell in love with it when I went with my husband. And then I went back this past summer and spent four weeks there,” she says.

And she loves her job, a love she wants to share with her clients.

“I think, especially here in America — first of all, we don’t receive as much vacation as people in other parts of the world do. We don’t naturally travel as much, and I think it’s really important for us as individuals to experience new cultures and see new things and get out of our comfort zone. It helps us be better people. It helps us be more compassionate, more understanding.

And so many people put it off and… they have all these excuses about why they put it off. But my whole mission, really, is to help people to not put things off, and to live life now.” n

Faces of the Industry IN ORDER, LEFT TO RIGHT: Sour Cream and Onin are Jonathan Spidle, Rick Orcutt, Aaron Snoddy, Jim Weaver, Patrick Riddle, with guest vocalists Kellee Cardamon, Aimee Weaver

SIDE GIG With a name like Sour Cream and Onin, you know this band is rocking the fun TEXT BY: MICHELLE LOVE // PHOTOS BY: ASH WRIGHT

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embers of the rock band Sour Cream and Onin are engaged in a vigorous — though fully insincere — debate over which of them is the real leader. The band consists of Onin Staffing employees Rick Orcutt, Jonathan Spidle, Jim Weaver, Aaron Snoddy, and Patrick Riddle.

“I’m the lead singer, guitarist, and the vice president of national accounts here at Onin,” says Spidle. He then adds, “I was nice enough to let these guys in on my interview,” to which the other members present, Weaver and

Orcutt, scoff and laugh. The argument is, of course, all in jest. In fact, there is no doubt the band members enjoy each other’s company. All during this interview, their banter with each other is light and unforced.

Orcutt, Spidle, and Weaver formed the band in 2012 for a company event in North Carolina. Orcutt, who is the IT director at Onin, says he is the “real” lead singer of the band who also plays the guitar and “stands closest to the middle of the stage.” Weaver is the chief operating officer of Onin and plays the

drums. Snoddy, who was unable to attend the interview, is the lead guitarist and a database administrator. The band’s bassist, Garrett Perkins, helps with the band’s video production and marketing.

During a recent performance at the Southern Automotive Conference in Nashville, the regular band was joined on stage by two guest vocalists, Kellee Cardamon, and Aimee Weaver Everyone in the band, says Weaver, has played professionally at some point or another. While they mainly play covers of hit rock bands like The Eagles, they make sure to showcase their talents in all genres of music while never forgetting to remind audiences they don’t take themselves too seriously. “One year Rick dressed in a Britney Spears costume and sang a Britney Spears song,” Weaver

Humor is the secret sauce of Sour Cream and Onin.

— Jim Weaver

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laughs. “It was a huge hit.”

Since their debut in 2012, the band has performed in five major functions, this year making their debut at the annual Southern Automotive Conference in Nashville. Weaver says that the first year Sour Cream and Onin performed they made an appearance in Flat Rock, North Carolina in an outdoor venue.

“We told everybody there was going to be a hypnotist there that night as the entertainment and we put down the lights and pulled out the fog and we came out to ‘In the Air Tonight’ by Phil Collins and it was great because nobody knew what was going on,” Weaver recalls.

“The biggest thing I think for Sour Cream and Onin is [when we played] the first time and how much feedback we [received] and it’s become kind of its own thing,” Spidle says.

“It’s so funny how much they love us and how we’re really not that good,” Orcutt laughs.

All For Fun After eight years together as a band, Sour Cream and Onin make a point to highlight how much fun they have together. “It’s a brilliant platform for us to advertise that sort of silliness,” says Orcutt. “Humor is [Sour Cream and] Onin’s secret sauce,” Weaver says. “We

50 | Southern Automotive Alliance / WINTER 2020

work very hard but we love to have a good time when it’s appropriate to do so.”

Orcutt says the band is always willing to book more performances but, naturally, life gets in the way.

“We do get asked by people to do other shows,” Spidle says. “It’s just, it’s hard.”

“It revolves around the company stuff and typically if we’re getting ready for a company event, we’ll try to pick up some other shows to practice and get the rust off,” says Weaver. “We all play outside of this band, too, so it’s not like this is the only time we touch our instruments.”

“All of us are in the same position of having families and being in pretty demanding jobs in a rapidly growing company so none of us are playing a ton.

But we have a blast,” Weaver adds.

Sour Cream and Onin is set to play at next September’s “Bring It On Home Again” event, a companywide gathering which is expected to bring approximately 80 percent of Onin Staffing personnel from locations throughout the South to their Birmingham, Alabama headquarters.

In the meantime, the band has plans to make the most of promoting the event.

“We bought a blue VW bus and we’ll be doing videos using the bus to promote ‘Bring It On Home Again’ and

I’m sure we’ll do a ton of promotion starting in January leading up to the September gathering. We’re moving into a new home office next year and we talked about using it [the bus] for the promotional tour and bringing it to the meeting and having everybody sign it, gut it, and then putting it in our home office as a memorial to the event,” Weaver says.

The events as a motivational tool to encourage growth in productivity.

“Everybody wants to come next year… in our office there are requirements for the office to be invited. They’re not super high but sort of minimum threshold of requirements for the office to be invited to the party,” Spidle says.

It’s a general consensus amongst the members that one of the biggest perks with the band is being able to put the focusing on work on the backburner.

“We spend more time at work than we will with our families and friends combined…you have to have some fun,” Weaver says.

“We love people but sometimes, people are people and we get beat up from a lot of different angles so we’ve got to treat each other well and have a good time. Otherwise you just go nuts,” Spidle says.

Fun is one thing. But band members also take pride in their talents.

“Rick always jokes that we’re not that good, but for some reason whenever we get together we’re pretty damn good,” Spidle laughs. “Jim was professionally regionally touring with a big name drummer, Rick’s been all over Nashville and Oklahoma and I was professionally touring in an 80’s rock band.”

And while many bands flame out over creative differences, Sour Cream and Onin shows no signs of that happening.

“Out of all the bands we’ve been in, there’s usually one guy that nobody likes,” Spidle says, adding that, “we actually like everybody in our band.”

“We’re serious about what we do but we’re also serious about having a good time whenever possible,” says Weaver.

“That’s how we operate.” n

BEST PRACTICES

OEMs Band Together On

Workplace Health and Safety

AIAG collaboration includes Honda, Toyota, Nissan, Ford, GM and FCA executives TEXT BY: LECEDRA WELCH WITH CARLA KALOGERIDIS PHOTOS COURTESY: LECEDRA WELCH // PHOTO BY: LENNY KUHNE/UNSPLASH

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hen it comes to worker safety, the auto industry is approaching a perfect storm.

Speed-to-market is imperative in today’s competitive global arena, putting pressure on workers to go faster. The industry is facing a record number of product launches — an exciting prospect, but one that requires deployment of new manufacturing processes. Baby Boomers are retiring at the rate of about 10,000 a day, taking their knowledge and experience of how to minimize workplace risk with them. In addition, with the complexity of global consolidation, declining sales, electrification, and autonomous driving,

the pressures on the workforce are substantial.

The good news? Automakers are joining together to chart their course on worker safety. “We’re asking you to join us in reaffirming our industrywide commitment to safety throughout our global supply chain,” stated an industry-wide letter signed by six OEM vice presidents of purchasing, including FCA’s Scott Thiele, Ford’s Burt Jordan, General Motors’ Steven A. Kiefer, Honda of America Mfg.’s Tom Lake, Nissan’s Rob Pitt, and Toyota Motor North America’s Robert Young. “We must ensure that our workforce health and safety policies, procedures, and training are current, robust, and a priority for leadership at all levels of our organizations.”

All six executives serve on the Automotive Industry Action Group’s (AIAG) board of directors.

A not-for-profit organization where OEMs, suppliers, service providers, government entities, and academics work collaboratively to solve some of the industry’s toughest challenges, these industry volunteers have taken the lead on workplace safety, starting with a new Contractor Safety Initiative.

Lecedra Welch, AIAG’s program manager of environmental sustainability, has been building the framework of this initiative for about two years, supported by a new Health and Safety Performance Standard work group. Comprised of OEMs, Tier Suppliers and safety contractor experts, the work group is focused on creating common approaches to workplace safety by:

• Addressing health and safety hazard identification and risk reduction

• Soliciting both program and

equipment information that addresses

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The OEMs are determined to increase safety and asked us to focus on best practices.

It’s our job to help the industry continue on the path that these vice presidents have committed to. — Lecedra Welch

worker safety

• Creating a roadmap to chart a course

forward in improved health and safety initiatives

• Developing programs and training to help keep workers safe on the job

• Creating regulatory compliance tools

to help companies meet reporting and other requirements

• Using techniques and processes to keep the industry focused on continuous safety improvement

“The OEMs are determined to increase safety and asked us to focus on best practices,” Welch says. “It’s our job to help the industry continue on the path that these vice presidents have committed to.”

To help focus the effort, a Supplier 3D Meeting on Health and Safety was held in March, asking suppliers to identify their pain points, risks, emerging issues, regulatory concerns, and common areas of interest. Topping the list of concerns for suppliers were ergonomics, lean line design, workplace violence, data management and reporting, working at heights, robotic safety, safe machine review processes, logistics safety, compliance, and benchmarking. The plan is to hold a call-to-action meeting for each topic, kicking off with an OEM 3D meeting in November.

Their joint letter of commitment to health and safety urges the industry 52 | Southern Automotive Alliance / WINTER 2020

to take action to improve personnel safety. To advance the development and implementation of solutions to address emerging industry safety threats and risks, the OEMs emphasized the need for a collaborative process. They asked AIAG to host the sharing of health and safety best practices on a dedicated web page and encouraged stakeholders across the supply chain to “join the campaign” by critically reviewing their current safety processes and procedures and submitting their best ones for posting. The purpose of posting the best practices together online is to support companies worldwide in hazard identification and risk reduction, regulatory compliance, and data management and reporting.

First fruits of the work group include the Contractor Safety Performance Framework, published in June. The work group also created free templates like Contractor Safety Requirements, a Site Safety Orientation Checklist, and a PreTask Safety Analysis tool. The purpose of the Contractor Safety Performance Framework is to: Provide a template for owners and contractors for covering the basic and fundamental activities necessary to a successful safety project.

Outline practices identified through collaborations with OEMs, suppliers, and contractors that could be voluntarily adopted by the companies at their discretion and would allow use of the whole document — or, simply the parts of it most relevant to their company based on size, scope, and contract demands.

Facilitate the gathering and availability of industry best industry practices in workplace safety, tailored to address the impact of local jurisdictions,

codes, and case law application.

Following the first document addressing construction and demolition, the next step for the Health and Safety Performance Standard work group is to consider the value of looking at contractor management with a focus on service and environmental safety.

The industry volunteers are also updating the Optimum Shipping and Receiving Systems Handbook to include the new OSHA fall protection standard 1910.28-30: Duty to Have Fall Protection and Falling Object Protection. The new content describes how the industry will protect open edges of docks with a fall hazard in place from a dock height of 48 inches or more. Future updates will determine if less than 48-inch-high docks will need fall hazard protection as well as a section on pedestrian dock safety.

“The idea is to be proactive, without re-inventing the wheel,” Welch says.

Welch feels the industry shoring up and shifting its focus to safety, noting that health and safety have also become a bigger part of what various organizations and governments are asking companies to report. For example, health and safety is now an integral part of reporting within Global Reporting Initiative (GRI); International Integrated Reporting Council (IIRC); Sustainability Accounting Standards Board (SASB); Sustainable Development Goals (SDG); and a vast number of investor and coalition networks such as CDP, Interfaith Center on Corporate Responsibility, and UN Principles for Responsible Investment (PRI).

“The biggest challenge,” Welch says, “is to get individuals working in the automotive industry to acknowledge and understand that health and safety is a critical value that needs our support and attention. We are working to increase awareness of these safety initiatives and boost contribution to, and utilization of, these free resources. For these efforts to really make an impact, the industry needs more participation in the safety best practice activity from all automotive tier levels.” n

Supplier Profile

IPAK Means TLC in Packaging

Kentucky fabrication company provides products that protect shipments of auto components TEXT BY: DAVID GREEN // PHOTOS COURTESY: IPAK

A

merican automobile consumers almost certainly are familiar with how most vehicles are delivered to dealers’ lots. The cars usually are transported on specially configured semi-trailer trucks.

That’s often after a ride on a railroad route, on rail cars designed to facilitate the loading, safe transit and unloading of the new cars and trucks.

As for vehicles manufactured overseas, they cross the oceans on huge transport ships, for transfer to ground transport to their destination.

But before any of that can happen, and the customer can pick out a vehicle to purchase, a sort of reverse process has to occur. The many thousands of individual parts and pieces that make up the automobile must be manufactured – many of them at remote facilities – and then delivered to the assembly site.

That process is not only equally important, it is much more complex than the delivery of assembled vehicles.

IPAK Incorporated, a foam and plastic fabricating company specializing in returnable packaging, has been working closely with the auto industry for the past two decades.

Eric Filburn, after graduating from Western Kentucky University with a degree in civil engineering, found a job outside of his major as a chemical engineer. When that job ended in a layoff, he went home to Hardin County, Kentucky, and was seeking job-hunting advice from a friend while they ate lunch.

A fellow at a nearby table heard the conversation. He spun around in his chair, Filburn recalled, and said, “You sound like just what we’re looking for.

Would you care to come talk to us?”

“Us” was Dave Mobley and partner Dennis Campbell, who had formed the company that would become IPAK. And Filburn would become general manager of the facility in Radcliff, Kentucky, adjacent to the U.S. Army’s Fort Knox military reservation.

Campbell and Mobley, both from Tennessee, were in the furniture foam business, producing padding material for sofas, chairs and other uses, and in 2000, they started a company to produce foam materials to cushion various parts and pieces during shipment.

“They saw a niche for specialty packaging at that time,” Filburn says.

They were looking at several locations, one of them an operation in Radcliff that was building returnable metal racks. It became the company’s home, and some 40 employees are on the payroll.

IPAK is not a shipper; the company designs and fabricates the packing used it transporting various parts and pieces from supplier to manufacturer.

Modern components for new industries such as automobiles required an improvement over the kegs and barrels and burlap bags that comprised much of the shipping containers of earlier times.

Companies such as IPAK work closely with automakers and manufacturers of various other products to devise custom-fitting racks, trays and inserts and also develop dunnage, or padding, to provide maximum WINTER 2020 / Southern Automotive Alliance 53

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protection both to multiple packing of smaller items and single packages of larger items.

Filburn says Class A materials include primarily pieces that are readily visible such as body parts, interior pieces from instrument clusters to door handles, and other conspicuous items.

But the delivery of every item in pristine condition is the priority, he says.

There is also an ergonomic requirement regarding the handling and assembly of parts and pieces into the finished product, as well as a need to protect the parts themselves during packing, shipping and unpacking.

Technology has played a major role in the development of materials and the machine tools that manipulate them.

CNC (computer numerical control) automates the processes of cutting, shaping and otherwise preparing pieces to exact specifications, in massproduced quantities.

All these things add up to a service that the customer needs and demands.

“They want it shipped a certain way, not just bulk packed,” Filburn says.

IPAK can produce pieces such as a plastic corrugated divider that is placed into an injection molded tote.

The divider or tray may include rolled edges, which protects both the surfaces of the component and the hands of the handler who is doing the packing or unpacking.

“When you die-cut it, and have all the little cells that you drop in on top, the top of the part is susceptible to scratching or damaging,” Filburn says. “We used to just cut our foam by waterjet CNC, a straight 2D profile. Now we’re having to tilt the head and anglecut.”

Other products include textilebased items such as hanging bags, sewn inserts, curtains and dust covers.

All these products ensure the safe delivery of a variety of items, Filburn says, “from a Corvette rear bumper down to the cap that covers your cigarette lighter, and everything in between.”

Environmentally, the reusable 54 | Southern Automotive Alliance / WINTER 2020

Just by the nature of our side of the industry, it lends itself to a green format. Reusable means it’s not something that’s a one-way ship and then a throwaway. packaging industry is providing a service by use of materials that may either be saved and reutilized in their original form and purpose, or recycled.

New materials, such as molded plastic and foam, are replacing corrugated paper cartons with crumpled newsprint for padding; wood pallets for bigger, heavier items are making the transition to high-strength plastic pieces.

“Just by the nature of our side of the industry, it lends itself to a green format,” Filburn says. “Reusable means it’s not something that’s a one-way ship and then a throwaway.”

IPAK also participates in conventional recycling efforts.

“Our straight plastic packaging is baled and recycled,” Filburn says.

“We’re negotiating to send our scrap to be recycled to a company in Canada to be used in making artificial turf for sports fields. I’m pretty excited about that. I’m very conscious that every time you see a dumpster go out of here, it’s going to a landfill.”

The revenue stream has not created a pile of gold like the one nearby at the United States Gold Bullion Depository at Fort Knox, but it is growing. IPAK has worked to develop relationships with the automakers in Kentucky, particularly Toyota, a little more than 100 miles to the east in Georgetown.

“Toyota is probably 80 to 85 percent of our business,” Filburn says.

IPAK would like to expand its relationships with the other major auto industry names located in Kentucky, including Corvette in Bowling Green and Ford, which has built cars and trucks in Louisville since 1913. Hundreds of smaller companies in the state and the region are suppliers to the three manufacturers’ facilities.

“We have worked with legislators to incentivize use of our services by in-state or regional suppliers,” Filburn says.

“That’s something I’d like to talk more about.”

His vision for IPAK is to stabilize the full-time roster of employees by using temporary workers to add manpower in times of heavy demand, and adding fulltime workers as the business expands.

Much of the work, other than that of the machine operators and the design of new products, can be handled by employees without advanced technical skills and abilities, Filburn says.

A priority, he added, is “creating an avenue to make it easier for customers to do business with us.” The company has added two new outside sales representatives, he said. “We want to extend our exposure and get more into the marketing side of it. We need to stay on top of what the customers’ needs are.”

Despite its small size, Filburn said, “We do everything in-house, and that’s what going to keep us where we are.”

The lean operation lends itself to innovation.

“I think it’s going to become more of a project management thing for us,” he says. “You might have to make two or three trips before some project is finished. We need to somehow shorten that timeline, from initiating development to acceptance of part and production.”

In 2009, IPAK founders Dave Mobley and Dennis Campbell parted company.

Campbell took the reins of IPAK Inc., while Mobley continued to manage a sewing operation in Pell City, Alabama.

Mobley’s company is named IPAK of Alabama, but the two companies are no longer affiliated. n

Supplier Profile

T.J. Snow Co. The Family That Welds Together Resistance welding specialty sets Chattanooga company apart TEXT BY: NANCY HENDERSON // PHOTOS BY: MARK GILLILAND

I

n the main office at T.J. Snow Co. in Chattanooga, Tennessee, where mechanical engineers are designing 3D computer models and customer service representatives are fielding calls, CEO Sam Snow strolls past a long row of filing cabinets strewn with various machine parts. Occasionally he pauses to run his finger along the edge of one and explain what it is: a Walmart price display hook, a piece from a rear Harley fender, a part for a diesel truck exhaust. Out in the shop, technicians are working on dozens of projects, from a machine used in the assembly of Ford Broncos to one bound for rocket maker SpaceX. Despite the company’s strong

automotive niche, says Sam, who bought the business from his father Tom in 2018, “We sell to people who make everything from tomato cages to spaceships.”

A leader in the resistance welding industry—services range from custom and automated spot welding machine manufacturing to training and repairs at the customer’s business—the global, 100-employee company was born 56 years ago in the East Ridge home of its namesake, T.J. “Jim” Snow Sr., Sam’s grandfather. “My dad remembers in high school not being able to use the phone because a customer might call,” Sam says. “And 18-wheelers would pull into the neighborhood off of Belvoir

[Avenue] and deliver the supplies.”

Says Tom, the company’s chairman, “My mother and I would have to go out in the middle of the street and break open the boxes because they were too heavy to lift. The truck driver was very understanding, and the neighbors were too.”

As time passed, Jim hired service technicians to repair his customers’ welders and revamp worn-out equipment. By the 1980s T.J. Snow Co. was building machines from scratch.

The company expanded several times and in 2013 moved to its current, 60,000-square-foot location near the Chattanooga Metropolitan Airport.

A second building around the corner WINTER 2020 / Southern Automotive Alliance 55

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houses hundreds of used spot and seam welders awaiting new lives. “We strip the machine all the way down and then build it back up just like a classic car where it’s like new when it goes back out,” Sam says.

In the early days, T.J. Snow’s primary clients were regional stove manufacturers. Today, Tier 1 and 2 automotive suppliers fuel most of the family’s business. “When my grandfather started the business in 1963, automotive was just getting started in the South,” Sam says. “So it’s been a happy coincidence that they’ve moved toward us.”

The company now specializes in resistance welding using safe, low-voltage electricity to fuse metal components together. “The benefit is it is inexpensive to actually make the weld,” Sam says. “It’s very fast. It’s very strong.”

The level of automation depends on what the customer wants and needs.

“Some customers might have a robot tending [the welding machine],” Sam says. “Others have an operator tending it.”

In addition to the influx of Tier 1 and 2 suppliers in the Chattanooga area, other auto industry changes have worked in the Snows’ favor. “Years and years ago, automotive products would go through a model year cycle that was a little more predictable as far as everybody getting everything ready for that model year,” Sam says. “Now that model years don’t really happen like they used to, activity goes on all year long.”

A welding lab in the shop allows technicians to develop, study and test new methods. “Some of the new lightweight metal alloys that the automotive industry is using in order to make the cars lighter and more fuelefficient are a lot harder to weld than the alloys that we were used to,” Tom says. “So the lab is more important than ever to develop the process.”

Maintaining large inventories of parts, both common and obscure, helps T.J. Snow Co. stay ready for year-round 56 | Southern Automotive Alliance / WINTER 2020

When my grandfather started the business in 1963, automotive was just getting started in the South. So it’s been a happy coincidence that they’ve moved toward us. —Sam Snow business—and the unexpected. “We keep a large stock of these,” Sam says, pointing to a welding transformer that fits inside the machines, “because delivery of one is oftentimes eight weeks from the manufacturer. To be able to pull one off the shelf and have it in a machine that we’re building from scratch and out the door in a week or two is key to our flexibility.”

Half of the company’s business comes from selling replacement parts.

In the shop, row after row of small blue bins are filled with copper tips and other pieces that tend to wear out.

“Think of the machines as razors, and these are the razor blades,” Tom says.

“Customers buy them over and over and over again.”

Adds Sam, “If somebody calls up and says, ‘Hey, I just need two of these,’ well, we’ll sell them two. But we often are dealing with customers that are buying 5,000 or 10,000 tips at a time.”

In addition to selling new and refurbished welding machines and replacement parts, T.J. Snow Co. runs a booming repair operation. Staff members provide extensive phone support for routine questions and afterhours emergencies, fix circuit boards and other components in-house, and travel to customer sites to troubleshoot, perform repairs and help employees understand how to set up and run the machines. Some of the service technicians are also pilots who fly from a hangar at the end of the street to a customer’s location when a problem can’t wait. Sam and Tom fly too; occasionally Sam’s five small children, who range in age from 2 to 13, come along for the ride.

“Sometimes,” Tom says, “the customers call and they say, ‘We don’t care what it costs. Get here in a hurry, because if our customer which supplies Nissan or Volkswagen is not able to supply the components that they install

on the cars, then the production line stops, and they charge thousands of dollars per minute.”

Training has been a major component of the business for nearly four decades. Four instructors from the service department lead classes at T.J. Snow Co. and at customers’ facilities.

Resistance welding process training seminars are held throughout the year at various conference spaces around the country and are well attended by machine operators, maintenance crews and welding engineers.

“What we recognize is if there are very few people who are learning this in school and if someone doesn’t understand the knobs that they’re turning, then they’re not necessarily going to get a good weld,” Sam says.

“One of the easiest ways for someone to gain that knowledge is to go through one of the seminars and be taught the fundamentals of resistance welding.”

Sam, who holds a degree in mechanical engineering, grew up working in the shipping department and returned to the family business in 2007 after working for seven years at Kimberly-Clark. He enjoys figuring out how to work more efficiently and modernize outdated processes and is poised to help T.J. Snow Co. move to the next phase.

“We’re going through a generational change, and that generation is getting ready to retire,” he says. “So we really needed to develop our leadership team for the next generation. That’s what we’ve been working on for the last four or five years.”

The management at T.J. Snow Co. may be changing, but the company motto remains the same. “We serve customers the way we want to be served,” Sam says. “What we try to do, as much as possible, is take care of customers in a very old-fashioned way but also using modern technology.” n

CAREER NOTES On April 1, 2020, JIM LENTZ, chief executive officer Toyota Motors North America, will retire after 38 years with the company. TETSUO “TED” OGAWA, chief operating officer TMNA, will succeed Lentz as CEO, reporting to Didier Leroy, TMNA vice chairman and president of business planning and operations, Toyota Motor Corporation.

Toyota said the changes are “designed to sustain its automotive operations and to continue its transformation in the mobility space.” Lentz presided over TMNA during quality control issues, natural disasters in Japan, the Great Recession in the U.S., and saw the launch of the Scion brand, and the consolidation and restructuring of the company’s North American operations under the “One Toyota” banner. Ogawa, who joined Toyota in 1984, has also served as executive vice president and chief administrative officer, TMNA, as well as deputy chief executive officer, China Region, president of Toyota Motor China Investment Company, Ltd., and as an expatriate from Japan at Toyota Motor Sales in Torrance, California.

KELLY MCNEFF has been named vice president, Corporate Communications for Toyota Motor North America (TMNA).

In this role, McNeff will be responsible for leading internal and external communication activities, including executive, business and brand communications. In addition, her responsibilities will include social media channel strategy and content.McNeff joins TMNA from McKesson Corporation, a Fortune 7 healthcare company, where she served

as vice president of Transformation Communciations. While at McKesson, her responsibilities included communicating the company’s global business transformation strategy across five business units, and with external media, stakeholders and investors.

Prior to McKesson, McNeff spent more than a decade with Kimberly-Clark Corporation. She took on roles in marketing, strategic communications, as well as executive and internal communications. Ultimately, she led the company’s international communications organization throughout Asia Pacific, Europe, Middle East, Africa and Latin America.

Hyundai Motor Group (the Group) has appointed DR. JAIWON SHIN as executive vice president and head of its recently established Urban Air Mobility Division. An internationally renowned aeronautics engineer, with a long history at NASA and in government service, Shin will lead the company into a new era of developing smart mobility products within the aviation industry.

Urban Air Mobility is expected to become a critically important part of the integrated mobility solution for ever-increasing traffic problems in mega cities around the world, Hyundai says. Shin most recently led the Aeronautics Research Mission Directorate at NASA, where he shaped the agency’s aeronautics research and development strategy for over 11 years.

His expertise in revolutionary airframe, engine, aviation safety, and air traffic management technologies is expected to allow Hyundai Motor Group to take a lead in the fast-growing urban air mobility sector. The new business unit will develop core technologies and innovative solutions for safe and efficient airborne travel. During his time at NASA, Shin oversaw a USD 725 million program to lead many new

aeronautics research initiatives, such as supersonic X-plane, electrification of aircraft, UAS traffic management, and Urban Air Mobility.

Kia Motors America (KMA) announced the appointment of MICHAEL COLE as president, effective November 11th.

Cole has served as KMA’s chief operating officer and executive vice president since joining the company from Kia Motors Europe in May 2018. At KMA, Cole has played a vital role in the successful launch of several all-new and refreshed models, including the Telluride SUV, as well as the rollout of Kia’s “Give It Everything” brand philosophy. In his new role, Cole will lead KMA’s business operations and report to Sean Yoon, president and CEO of Kia Motors North America.

Volvo Car USA announced that MARIA ZWAIK joined the company’s corporate communications team as senior specialist, Media Relations. Zwaik previously worked five years in communications at Jaguar Land Rover, as well as in customer-oriented positions with Tesla and Toyota. She also has formal training as an auto repair technician.

CALEY DAWKINS, who served as director of membership, events and administration for the Mississippi Automotive Manufacturers Association has left MAMA. As of January she now works in human resources and office management at the Ramey Agency, which specializes in marketing and brand building. n WINTER 2020 / Southern Automotive Alliance 57

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

GAMA is continuing to deliver value-driven events in 2019, and has already confirmed some events in 2020:

Events held so far this year include: • MARCH 12, 2019 - “Critical Issues Regarding OSHA” – held in West Point, Georgia/Lanett, Alabama near the Kia assembly plant in West Point, Georgia • MAY 22, 2019 - “Critical Issues Regarding OSHA” – held in Rome, Georgia • MAY 7, 2019 - Annual Golf Tournament Benefiting the Southern Automotive Women’s Forum (SAWF) – held at Callaway Gardens in Pine Mountain, Georgia (near Columbus, Georgia) • AUGUST 6, 2019 - Tour of Kia Motors Manufacturing Georgia (KMMG) assembly plant in West Point, Georgia • NOVEMBER 13, 2019 - Annual Economic Update Meeting featured Bill Strauss, Senior Economist and Economic Advisor, from the U.S. Federal Reserve Bank, and Michael Gonsalves from Economic Development Canada.

Upcoming events planned: • FEBRUARY 5, 2020 - Cybersecurity and the Supply Chain, coproduced with AIAG – Douglasville, Georgia. The opening keynote speaker will be Ken Munro, a Partner and Founder of Pen Test Partners LLP, a firm of ethical hackers. He regularly blogs on everything from maritime security to hacking cars and the Internet of Things. He regularly appears

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

on BBC TV and BBC News online as well as the broadsheet press. He is also an Executive Member of the Internet of Things Security Forum and spoke out on IoT security design flaws at the forum’s inaugural event. He also writes for various newspapers and industry magazines in an effort to get beyond the unhelpful scaremongering put about by many security vendors. Ken has become a voice for reform and legislative change in the largely unregulated IoT, briefing UK and US government departments, as well as being involved with various EU consumer council. Here is Pen Test Partners’ website - https://www.pentestpartners.com/securityblog/ The meeting will also feature other expert speakers and panelists in industrial cybercrime, IP theft, OEM and industry perspectives, cyber resources, and more.

• MARCH, 2020 – Automation Update Meeting and Plant Tour – in final planning stages • APRIL OR MAY, 2020 - Automotive Diversity Meeting – in planning stages • APRIL 28, 2020 – Annual Golf Tournament Benefiting the Southern Automotive Women’s Forum (SAWF) will be held at Callaway Gardens in Pine Mountain, Georgia

GAMA is committed to delivering value-driven events year-round.

For further information, please contact Rick Walker, GAMA President, at rwalker@GAMA-Georgia.org or 770-314-9040.

58 | Southern Automotive Alliance / WINTER 2020

WINTER 2020 / Southern Automotive Alliance 59

REGIONAL REPORTS

Alabama Automotive Manufacturers Association

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

ALAUTOINDUSTRY.ORG

2020 AAMA SAVE THE DATE Q1 – Workforce Workshop Event (Date TBA) Cullman, AL

JANUARY 30 Environmental Supplier

BENEFITS OF AAMA MEMBERSHIP INCLUDE:

Partnership Conference AIDT Training Facility at Honda Manufacturing Alabama – Lincoln, AL

• Business networking opportunities

FEBRUARY 18 Supply Chain & Logistics Conference Huntsville Airport – Huntsville, AL

• Sharing of manufacturing best practices

MARCH 12 Southern Automotive Quality SummitVon Braun Center – Huntsville, AL

• Information on advances in technology and continuous improvement

APRIL 3 Honda Grand Prix Indy Race

• Access to internet database of Alabama automotive-related companies

Barber Motorsports – Leeds, AL

APRIL 29-30 Maintenance Symposium Bryant Conference Center – Tuscaloosa, AL

MAY 13 Supplier of the Year Awards (in

• Leadership opportunities • Information on issues impacting the industry

• Listing on AAMA website • Members Directory • Promotional opportunities for company news

partnership with BCA) Montgomery, AL

• Factory floor assessments (participating companies are eligible for AAMA Supplier of the Year Award)

JUNE Golf Outing with Nick Saban

• Member discounts for training

Ol’ Colony Golf Complex – Tuscaloosa, AL

JULY 30 Supplier Diversity Conference Von Braun Center – Huntsville, AL

SEPTEMBER Alabama Auto Show Space & Rocket Center – Huntsville, AL JUNE 2021 Nick’s Kids Championship Golf

Tournament Ol’ Colony Golf Complex – Tuscaloosa, AL Best practices workshops with the following companies: • WKW Automotive • Hodges Warehouse + Logistics • Shoals Extrusion • Sanoh America

60 | Southern Automotive Alliance / WINTER 2020

• 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: Madison Bosc | 205.201.8682 | madisonaama@gmail.com Ron Davis | 205.657.5101

TAMA helps Tennessee automotive companies, especially suppliers, react to the challenges of the global automotive marketplace.

TAMA is a membership organization with a mission to strengthen and expand Tennessee’s automotive industry. TAMA’s diverse membership includes OEMs, Tier 1, 2, and 3 suppliers, government agencies, and professional service organizations that have expertise in the automotive industry. Members enjoy access to some of Tennessee’s top automotive executives, strong support from the state’s economic development team, and discounted fees to membership meetings and other TAMA events.

Our Mission is to support and strengthen the automotive industry in Tennessee We are celebrating our 32nd year being an integral part of automotive manufacturing in our great state.

Tennessee’s first OEM was Nissan launching in 1983. Since then, our base has grown to include General Motors and Volkswagen assembly plants along with over 940 Tier 1,2 and 3’s.

TAMA provides to our membership a number of benefits that are essential to successful operations such as: • Working with educational institutions to develop response strategies for workforce issues to include recruiting, training, and retention.

• Providing networking opportunities via workshops and semiannual member meetings.

• Sharing best practices including plant tours.

• Quarterly communications newsletter.

• Weekly updates using social media platforms • Membership directory.

• Facilitating introductions amongst our members.

• Member spotlight provided through our communications.

• Annual golf event.

• New website to launch late 2019.

TAMA 2020 BOARD OF DIRECTORS Rick Youngblood TAMA President Dan Davidson TAMA Vice President, Vice President Thermal Systems, Merilli Ashley Frye Executive Director, TAMA Lynda Hill TAMA Secretary/Treasurer, Attorney, Frost Brown Todd Andre Gist CEO, Manufacturers Industrial Group Ed Carter C & S Plastics Barry Owens Vice President, Bridgestone Americas

Marius Sipos Managing Director, Power BtoB Kim Williams Executive Director Global Quality, Tenneco Dex Batista Senior Manager Government Affairs, Magna Victoria Hirschberg Director of Business Development, Tennessee Economic and Community Development Michael Monday General Counsel, Marelli Ryan Fulkerson Director New Model Engineering, Nissan North America Bobby Locke Executive Vice President & CMO, Kasai

To join TAMA, visit www.tennauto.org.

For questions about membership, contact Ashley Frye 615-525-4533 email: ashley@tennauto.org WINTER 2020 / Southern Automotive Alliance 61

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

How many auto jobs are in your state?

According to AutoAlliance.org, as of 2017 these are the numbers of total automotive jobs per the states covered by Southern Automotive Alliance magazine:

68, 687

7

,33

133

662,574

157,759 212,639

113,265 310

, 0 2 2

Southeast Auto Stocks Company/Security

Headquarters

Southeast U.S. Operations

Ticker

Exchange

Closing Price 1/8/2020

Closing Price Stock Price Growth 1/8/2019

BMW

Munchen, Germany

SC.

BMWYY

OTC

27.73

27.68

0.18

Ford Motor Co.

Dearborn, Michigan

KY

F

NYSE

9.25

8.37

10.51

General Motors Co.

Detroit, Michigan

KY, TN, TX

GM

NYSE

34.65

34.81

-0.46

Honda Motor Co. Ltd.

Minato, Tokyo, Japan

AL, S.C.

HMC

NYSE

28.13

28.7

-1.99

Hyundai Motor Co. Ltd.

Seoul, South Korea

AL

HYMLF

OTC

89

89

0.00

Kia Motors Corp.

Seoul, South Korea

GA

KIMTF

OTC

30.3

30.3

0.00

Mazda Motor Corp.

Hiroshima, Japan

AL

MZDAF

OTC

8.655

11.04

-21.60

Mercedes-Benz (Daimler AG)

Stuttgart, Germany

AL, GA, S.C.

DDAIF

OTC

55.12

54.72

0.73

Mitsubishi Motors Corp.

Minato, Tokyo, Japan

KY

MMTOF

OTC

4.135

5.31

-22.13

Nissan Motor Co. Ltd.

Nishi-ku, Yokohama, Japan

MS, TN

NSANF

OTC

5.88

8.07

-27.14

Porsche Automobile Pfd.

Stuttgart, Germany

GA

POAHF

OTC

75.475

62

21.73

Toyota Motor Corp. Ltd. Ord.

Toyota, Aichi, Japan

AL, KY, MS, TX

TM

NYSE

141.16

122.31

15.41

Volkswagen Ag Ord.

Wolfsburg, Germany

TN

VLKAF

OTC

194.65

164.095

18.62

Volvo AB ADR

Gothenburg, Sweden

SC.

VLVLY

OTC

16.89

13.625

23.96

64 | Southern Automotive Alliance / WINTER 2020

BY T H E N U M B E R S

20

SECONDS Interval at which new vehicles are produced in Tennessee. commercialappeal.com

21,500 Number of new automotive jobs in South Carolina between 2011 and 2018. sccommerce.com

$440

MILLION Value of capital investment in the Huntsville, Alabama area in connection with projects in the vicinity by five automotive suppliers. autonews.com

110 Anticipated jobs to be created

by Nippon Light Metal’s new manufacturing facility in Adairsville, Georgia southernautocorridor.com

1.2

ONE Kentucky’s ranking among U.S. states for per capita production of cars, light trucks, and SUVs. thinkkentucKYcom

$800

MILLION MILLION Number of eleventh-generation Corollas produced at Toyota’s Blue Springs, Mississippi plant. wreg.com

Value of expansion at Volkswagen’s Chattanooga, Tennessee plant to produce the company’s first electric vehicle. southernautocorridor.com

$1.4 1994 BILLION Investment by General Motors Co. to expand its Arlington, Texas facility. bizjournals.com

Year when the first South Carolina– made BMW was produced. sccommerce.com

WINTER 2020 / Southern Automotive Alliance 65

KUDOS

Empowering the Leaders of Tomorrow

Toyota’s Making Life Easier Scholarship Program supports college-bound students nationwide TEXT BY: LAWRENCE ELIZABETH KNOX // PHOTOS COURTESY: TOYOTA

T

oyota Motor Corp. has been making lives easier by producing reliable vehicles that will get families from point A to point B safely since 1937, but transportation is far from the company’s only commitment to the community.

The multinational automotive manufacturer aspires to achieve mobility for all, and for over a decade, this vision has included providing

66 | Southern Automotive Alliance / WINTER 2020

assistance to deserving, albeit economically disadvantaged youth on their paths from students to college graduates and qualified employees.

Since 2007, Texas-based Toyota Financial Services, the finance and insurance brand for Toyota in the United States, has awarded a total of $8.4 million in scholarships to more than 1,300 young adults through its annual Making Life Easier scholarship program launched by Elena Sacca

Smith, group manager of the Office of Social Innovation.

“I think Toyota’s success really depends on our future workforce,” she says. “We’re looking for people that have core skills and ideally STEM skills, and there just aren’t enough kids that are either interested in STEM or have a STEM background to fill the technical jobs that we have available.”

Online applications were due at the end of October, and in the weeks since the team, in partnership with Scholarship America, has been reviewing the 513 candidates vying for a scholarship in the 2020 program. To be eligible, applicants must be between

Students, who sometimes are the first in their families to go to college are shown what it can be like to work for a major corporation with potential implications for their futures.

the ages of 16 and 26, have a minimum cumulative grade point average of 2.0 or higher, plan to enroll in full-time undergraduate or graduate study for the ensuing academic year and be affiliated, whether as a member, alumni or staff, with one of Toyota’s 89 nonprofit partners across the nation, such as Junior Achievement USA, Boys & Girls Clubs of America and Girl Scouts of the USA. Come spring, up to $1 million will be given to 100 college-bound recipients, who are selected based on a combination of financial need, academic achievement and dedication to community service. The available scholarships, ranging from $5,000 to $20,000, are distributed over the course of four years to help offset the climbing cost of tuition and fees for postsecondary education.

Financial assistance, the program supports the continuous growth of the selected students through mentorship

with a focus on college preparation and life skills development.

Every June, students are invited to partake in Toyota Scholars Day at the company’s North American headquarters in Plano. The event recognizes their hard work and celebrates their accomplishments, but it is more than a reception with refreshments, Smith says. Last year, the recipients, of whom about half are typically in attendance, participated in workshops, sat in on collegiate information sessions, toured the offices and were even gifted backpacks full of school supplies and new laptops.

“In many cases, the students are the first ones in their families to go to college, and so they have a really meaningful day on our campus, and then they get to see what it’s like to be at a major company,” Smith says. “It’s really like a day in the life of a Toyota employee or a team member, as we like to call them.”

A New Jersey native born into a family of teachers, Smith earned her bachelor’s degree in education at the University of Delaware but worked in the technology sector before joining Toyota North America as a senior corporate communications specialist in 2004. At the time, Smith says, the company lacked a corporate social responsibility strategy, and recognizing that need, her team began to formulate a plan to strengthen Toyota’s societal impact and in turn, its reputation.

She developed the Making Life Easier scholarship program, which originated in partnership with the Boys & Girls Clubs of East Los Angeles and was established alongside a national employee volunteer program, in response to an alarming yet silent epidemic that was making headlines – America’s dropout crisis.

“One in four high school students was not graduating on time, and that was a core issue in our headquarters

We’re looking for people that have core skills and ideally STEM skills, and there just aren’t enough kids that are either interested in STEM or have a STEM background to fill the technical jobs that we have available. — Elena Sacca Smith WINTER 2020 / Southern Automotive Alliance 67

KU D O S

location in Los Angeles, particularly in the underserved communities,” Smith says, who ads that she feels she has come full circle in her 15-year tenure with Toyota.

Although her interest in promoting educational outreach began as a side project of sorts, it evolved into a career, one that eventually brought her to Plano when the company’s U.S. headquarters completed its relocation from Torrance, California, in 2017. After overseeing corporate social responsibility in Toyota Financial Services, Smith stepped into her current, more comprehensive role, in which she is responsible for supporting all social sustainability efforts across Toyota, including diversity and inclusion, environmental sustainability and philanthropy in areas like workforce readiness.

Like a teacher, Smith’s work aspires to empower tomorrow’s leaders to reach their highest potential. But that work also influences her co-workers, of whom over 60 percent – equaling roughly 2,000 team members – regularly volunteer in the local community through mentorships, as well as back-toschool and holiday drives, she explains.

“We recognize them for their service by contributing ‘Dollars for Doers’ and 68 | Southern Automotive Alliance / WINTER 2020

grant money for their favorite charity,” she says. “We find that they really like to be connected to what’s important to the company. It helps them network with other team members, and it builds pride for themselves as well as their team.”

On the national level, Toyota’s largest partnership is with Boys & Girls Clubs of America, the impact of which reaches far beyond the Making Life Easier scholarship opportunity. Over 400 team members have served as mentors to teens in BGCA’s youth development programs, and in 2014, Toyota became the signature sponsor of the national nonprofit’s premier Youth of the Year competition, providing the winner with a brand new Corolla and financial support.

In 2018, the prestigious grand prize was given to Malachi Haynes, who had been a member of the Boys & Girls Clubs of Metro Denver since 2006. In high school, the Colorado teen received guidance from Toyota volunteers, who helped him write his college essays, brave the interview process and even complete his application for the Youth of the Year program. Although he did not win in his first attempt, his mentors encouraged him to try again the following year, resulting in quite a victorious senior year, Smith explains.

According to the BGCA website, Haynes attended Colorado State University to pursue a career in kinesiology.

In an effort to continue providing further aid, Toyota Financial Services expanded its programs in 2010 to include paid summer internship positions, the majority of which are reserved for Making Life Easier scholarship recipients, Smith says. Last year, there were a total of 18 interns with four headquartered in Plano and the remaining 14 placed at call center locations in Owings Mills, Maryland, Cedar Rapids, Iowa and Chandler, Arizona.

In this fashion, the hope for the future is to continuously surpass the company’s present efforts to maintain strength within the industry and prosperity within its local communities.

“We want to get our students access to real-world experience beyond the internship,” Smith says. “It’s our vision that we continue to provide higher impact to them and ensure their success, and that will include more mentorship, job-placement opportunities and an expansion of student eligibility. We have to create awareness about what the mobility space is going to look like in the future.” n

WINTER 2020 / Southern Automotive Alliance 69

Index AAMA..................................................... 60

IPAK............................................29, 53, 54

Nissan.......................17, 18, 30, 32, 33, 51

AIAG..............................................9, 51, 52

Ivanka Trump....................................... 17

Northwest Alabama Economic

Alabama Commission on Artificial

Jaiwon Shin................................................ 57

Development Agency.......................... 29

Intelligence

J.D.Power..................................... 30,31,32

Nucor.........................................................

Alabama Community College

J.F. Drake State Community &Technical

NVIDIA................................................... 16

System..........................................1, 40, 72

College................................................... 39

NXP........................................................ 16

Alliance of Automobile

Jeff Lynn..................................................... 40

Onin.............................................. 4, 49,50

Manufacturers..................................... 35

Jennifer Springer................................24, 25,

OSHA

APMA..................................................... 20

Jim Lentz..................................................... 57

Plex........................................................ 69

Aptiv...................................................... 15

Jones County Junior College................ 19

Porsche............................................ 13, 17

Asa Hutchinson......................................... 18

Kentucky Cabinet for Economic

Prince Metal Stampings...................... 71

Auburn University......................... 41, 42

Development........................................ 19

Rick Hendrick............................................. 14

Brexit..................................................... 44

KAIA/KAM.............................................. 63

SAC 2019..............10,20, 21, 43, 44, 46, 47

BCA.......................................................... 5

Kay Ivey...................................................... 15

Samuel, Son and Company................. 18

Bill Lee........................................................ 12

Kelly McNeff............................................... 57

SCAC/SCMA..................................... 19, 62

BMW................................................ 32, 45

Kia...................................14, 18, 32, 36, 37

Shinhwa................................................ 17

Butler Snow.......................................... 71

Kristin Dziczek.....................................27, 28

Sour Cream and Onin.................... 49, 50

Caley Dawkins........................................... 57

Lecedra Welch......................................51,52

Star Wars............................................... 17

Calhoun Community College........ 17, 40

Limestone County Career Technical

Staubli................................................... 11

Carvana................................................. 14

Center......................................... 38, 39,40

Systems................................................. 11

CAVS......................................................... 6

Linamar................................................. 21

Takata................................................... 18

CES......................................................... 20

Lisa Harris Boyd..............................46,47,48

TAMA61

Center for Automotive Research. 27, 28

LMC Automotive........................ 30,31,32

Tesla...........................................12, 15, 45

Center for Auto Safety........................ 34

Magna.................................................... 21

Tetsuo “Ted” Ogawa................................. 57

Continental Tire............................. 16, 18

MAMA.................................................... 59

T.J. Snow Co...................................... 55,56

Cox Automotive Group........................ 32

Maria Zwaik............................................... 57

Tom Devall...........................................41, 42

Denso..................................................... 16

Mark Brazeal........................................39, 40

Tom du Plessis.......................................... 12

DiCentral..................................... 43,44,45

Martinrea.............................................. 21

Toyota......................13, 15, 28, 31, 32,40,

Donald Trump............ 12, 21, 26, 28, 34, 43

Mazda.................................................... 35

51, 66, 67, 68, 69,

Faurecia................................................ 15

Mazda-Toyota Manufacturing

University of Alabama......................... 19

FCA..................................14, 28, 31, 32, 43

USA........................................ 16, 38,39,40

UAW....................................................... 14

Ferrari ................................................... 23

McAbee.................................................... 7

Uber....................................................... 45

Flavio Volpe............................... 20,21,22, 23

Mercedes-Benz/

USDOT................................................... 34

Ford................13, 15, 28, 31, 32,43, 45, 51

Daimler...........................12, 13, 19, 32, 45

USMCA..................................21, 25, 26, 27

GAMA..................................................... 58

Michael Cole........................................36, 57

Vince Green..........................................39,40

General Motors...................13,14, 15, 16,

Michelin.......................................... 17, 19

Volkswagen..................................... 12, 28

28, 30, 31, 32, 33, 35, 43, 45, 51

Minact..................................................... 7

Volvo...................................................... 17

Goodyear............................................... 16

Mitch McConnell....................................... 26

Wake Technical Community

Gus Faucher...................................30, 31, 33

Mitsubishi............................................. 17

College................................................... 14

Hodges..................................................... 2

NAFTA..............................21, 22, 25,26, 27

Honda...........13, 15, 28, 30, 31, 32, 35, 51

NAOS........................................................ 3

Hyundai........13, 14, 15, 16, 18, 19, 32, 35

NHTSA.........................................19, 34, 35

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