OESA News 2017 First Quarter, Edition 3

NEWS

Original Equipment Suppliers Association

2017 First Quarter │ Edition 3

Don't miss the 29th Annual Canada/U.S. Automotive Dinner, March 6 Hau Thai-Tang, group vice president, global purchasing, Ford Motor Company, will deliver this year’s keynote address.

IN THIS ISSUE...

2 3

Supplier Industry Driving The Future The Suppliers' Voice

4 7

Legislative News Industry Events

8 10

OESA Events Calendar of Events

SUPPLIER INDUSTRY DRIVING THE FUTURE

THE LARGEST U.S. SECTOR OF MANUFACTURING JOBS 871,831 TOTAL U.S. DIRECT EMPLOYMENT

SOUTHWEST

WEST

MIDWEST

NORTHEAST

SOUTHEAST

6%

5%

5%

6%

51%

49%

7%

8%

30%

32%

2012

2015

2012

2015

2012

2015

2012

2015

2012

2015

871,831 TOTAL U.S. DIRECT EMPLOYMENT MICHIGAN 125,909

TEXAS 33,132

ARKANSAS 10,495

WASHINGTON 4,687

NORTH DAKOTA 1,994

DELAWARE 400

OHIO 96,238

CALIFORNIA 31,190

MISSISSIPPI 9,706

ARIZONA 4,672

RHODE ISLAND 1,879

MONTANA 269

INDIANA 88,306

PENNSYLVANIA 27,920

FLORIDA 8,827

OREGON 4,473

MARYLAND 1,720

WYOMING 136

TENNESSEE 50,128

GEORGIA 23,836

OKLAHOMA 8,676

WEST VIRGINA 4,069

NEW HAMPSHIRE 1,389

ALASKA 30

KENTUCKY 47,658

NEW YORK 19,517

NEBRASKA 8,415

NEW JERSEY 4,028

VERMONT 745

HAWAII 21

ALABAMA 41,107

WISCONSIN 18,200

UTAH 7,884

SOUTH DAKOTA 3,931

IDAHO 616

WASHINGTON D.C. 2

ILLINOIS 38,394

MISSOURI 16,301

MINNESOTA 6,366

LOUISIANA 3,167

MAINE 549

NORTH CAROLINA 33,825

IOWA 16,114

KANSAS 6,270

COLORADO 3,120

NEW MEXICO 525

SOUTH CAROLINA 33,766

VIRGINIA 13,277

CONNECTICUT 4,958

MASSACHUSETTS 2,510

NEVADA 484

DRIVING THE FUTURE | 11

Source: IHS Markit

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Voice

The Suppliers’

Julie A. Fream

President and CEO

The North American supplier industry is facing a great deal of uncertainty. With a new U.S. administration and Congress, the imperative to raise our collective voice is greater than ever.

Proposals from the White House and Congress on changes to policy – including NAFTA, tax reform, regulatory and labor – have come in rapid succession since the election.

Our parent organization, the Motor & Equipment Manufacturers Association (MEMA), recently sent a media release (see page 4) outlining our position on a number of these items. Many of these changes create the opportunity for suppliers to strengthen their U.S. operations and manufacturing competitiveness. We are aligned with these goals and are in support of a simplified, more predictable tax code that would generate investment, economic growth and job creation in the United States.

OESA supports tax reform. However, many suppliers are concerned that the border adjustment tax (BAT), as currently proposed, has a number of issues that could negatively impact many U.S. manufacturing organizations. MEMA is engaging a leading consulting firm to investigate the potential impact of various government proposals on the U.S. automotive industry. The goal of this effort is to identify specific initiatives that will lead to a more competitive manufacturing environment and continued job growth and to share them with government officials.

MEMA and OESA are well positioned to represent the automotive OE supplier community as changes take shape. We encourage you to get involved on these critical issues.

• •

• •

Click here to understand the critical role we play in the U.S. economy.

A recent study outlines the economic impact of our industry.

Click here to share your concerns and point of view.

Take the members-only survey to help us better understand your organization’s concerns as they relate to the proposed changes in policy. The survey closes Thursday, March 16.

Attend the MEMA Legislative Summit in Washington, D.C. on May 17-18 to speak directly with legislators and regulators that are making important decisions, and hear for yourself where critical issues stand.

Ensure that a member of your organization is engaged with the MEMA Government Affairs Committee (GAC). To learn more about GAC, contact Catherine Boland at cboland@mema.org.

This is a unique time in our industry and in American politics. I encourage all members to engage with us as we further define our point of view and plan of action. Championing the voice of our members is our mission and number one priority.

As always, please feel free to contact me at 248.430.5963 or jfream@oesa.org.

To help us better understand your organization’s concerns as they relate to the proposed changes in policy, click here to take our survey.

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LEGISLATIVE NEWS

MOTOR VEHICLE COMPONENT MANUFACTURERS TRADE ASSOCIATION OUTLINES ITS POSITION ON PROPOSED NEW TAX REFORM MEDIA CONTACT: Cindy Sebrell Vice President, Communications│MEMA csebrell@mema.org │ 202-658-9487

The Motor & Equipment Manufacturers Association, which represents 1000 member companies, supports tax reform initiatives that will increase American manufacturing employment without putting an integrated supply chain at risk.

March 1, 2017 – Washington, D.C. – The Motor & Equipment Manufacturers Association (MEMA) and its four specialized divisions are aligned with the goals of the Trump administration and Congress to strengthen America’s global manufacturing competitiveness and to create more American jobs. To reach these goals, MEMA supports a simplified, more predictable tax code that would generate investment, economic growth, and job creation in the United States.

Motor vehicle component manufacturers are the largest employer of manufacturing jobs in the U.S., contributing nearly 3 percent of the U.S. gross domestic product. Suppliers directly employ more than 871,000 Americans, up 19 percent since 2012, and generate a total direct and indirect employment impact of 4.26 million jobs, up nearly 18 percent since 2012. This job growth is made possible by a highly-integrated North American supply chain that supports both the automotive makers and the companies that supply motor vehicle parts. Many suppliers located in the U.S. import and export vehicle parts and components within the North American market. Depending on supply chain logistics, parts are often exported to be combined with other parts, then imported back to the U.S. for final vehicle assembly.

While MEMA supports tax reform, a border adjustment tax (BAT), which is a component of the current U.S. House Republican tax reform proposal, could disrupt the integrated supply chain for many companies and cause a ripple effect throughout the U.S. economy by 1) increasing costs for vehicle manufacturers, 2) decreasing available capital for new product development, 3) increasing consumer prices, 4) lowering sales, and 5) potentially decreasing manufacturing jobs in America. MEMA has engaged a leading research firm to investigate these potential effects and identify specific initiatives that will lead to a more competitive manufacturing environment and continued job growth in the U.S. “The President has said that he wants to increase jobs in America and put forward tax reform that is in the best interest of American businesses, consumers, and workers,” said MEMA President and CEO Steve Handschuh. “MEMA and its members are eager to work with the new administration and Congress to identify and implement tax reform that will allow our industry to continue as an economic engine for America.”

In January, MEMA released an important economic impact study that clearly defines the critical role motor vehicle parts suppliers play in the U.S. economy. The motor vehicle component manufacturing industry in the U.S. has experienced robust growth due to increased demand and vehicle sales. The stability and integration of the North American supply chain has been particularly beneficial to suppliers, contributing to growth in jobs and investments in the United States. MEMA supports reasonable tax reform that will allow this trend to continue.

About MEMA The Motor & Equipment Manufacturers Association (MEMA) and its four specialized divisions comprise a leading international trade association in the fast-changing mobility industry. Representing vehicle suppliers that manufacture and remanufacture components, technologies, and systems for use in passenger cars and heavy trucks, MEMA serves as a critical bridge between high-tech capabilities in new vehicles –such as autonomous vehicles and vehicle connectivity—and the “nuts and bolts” of vehicle manufacturing. MEMA works at state, federal, and international levels to ensure that the marketplace and public policy support the development of advanced, transformative technologies that enable safer, smarter, and more efficient vehicles. MEMA’s members are represented through four divisions: Automotive Aftermarket Suppliers Association (AASA), Heavy Duty Manufacturers Association (HDMA), Motor & Equipment Remanufacturers Association (MERA), and Original Equipment Suppliers Association (OESA). For more information on how MEMA is leading transformation in the mobility industry, visit www.mema.org.

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INDUSTRY EVENTS

AUTOMOTIVE NEWS ANNOUNCES 2017 PACE AWARD FINALISTS OESA is excited to be a co-sponsor of this annual celebration of supplier innovation.

Congratulations to all finalists.

• Aperia Technologies – Burlingame, Calif. – Halo Tire Inflator • Autoneum – Zurich, Switzerland – Hybrid Acoustics concept • Continental Corporation – Frankfurt – MK C1® – Electrical braking system • Continental Structural Plastics – Auburn Hills, Mich. – TCA Ultra Lite • Dana – Maumee, Ohio – Adaptive Air/Oil Separation System • Dana – Maumee, Ohio – Multi-Layer Steel Transmission Pump Gasket • Dana – Maumee, Ohio – Tire-Pressure Management System • Dayco – Troy, Mich. – ACTIVAC™ Vacuum Generation System • Delphi Automotive – Krakow, Poland – 3D Gesture Recognition System • Delphi Automotive – Auburn Hills, Mich. – 76GHz Short Range Radar for 360° Sensing • DENSO Corp. – Kariya-shi, Aichi-ken, Japan – 4th Generation Diesel Common Rail System • Eaton & BorgWarner – Galesburg, Mich. & Auburn Hills, Mich. – Procision® DualTronic® dual-clutch transmission • Federal-Mogul Powertrain – Southfield, Mich. – DuraForm-G91™ Diesel Piston • Firstronic – Grand Rapids, Mich. – Mixed double sided PCB technology • Flex Automotive – Farmington Hills, Mich. – Programmable Controller • Giffin – Auburn Hills, Mich. – ELITE wet scrubbing technology • GKN Driveline – Redditch, Worcestershirech - UK – GKN co-Axial electric axle • Hanon Systems Deutschland – Kerpen, Germany – Electrical Expansion/Shutoff valve family • Honeywell – Plymouth, Mich. – Variable Nozzle Turbocharger for Gasoline Engines • International Automotive Components – Ebersberg, Germany – FiberFrame™ • JTEKT Toyoda Americas Corp. – Arlington Heights, Ill. – High-Speed Axis Synchronization • Koito Manufacturing – Shizuoka, Japan – Sensor-Based Automatic Headlamp Leveling • MAHLE – Stuttgart – Steel Piston Laser Welding • NVIDIA – Santa Clara, Calif. – DRIVE PX 2 – In-Car Artificial Intelligence Supercomputer • OEConnection – Richfield, Ohio – Dynamic Replacement Collision Parts Pricing • Preh – Bad Neustadt/Saale – Germany – Steering Wheel Touch Control • Robert Bosch – Plymouth, Mich. – Engine Compartment Actuator • Roechling Automotive – Worms, Germany – Central Acoustic Air Manifold • Sanhua Automotive – Hangzhou, China – Electronic Expansion Valve • Schaeffler – Wooster, Ohio – Electromechanical Active Roll Stabilizer • Schaeffler – Wooster, Ohio – One-way Transmission Clutch Assembly • TI Automotive – Auburn Hills, Mich. – Port Direct Fuel Injection System • Valeo – Bietigheim-Bissingen, Germany – Park4U™ Remote • Yazaki – Makinohara, Japan – Large Aspherical HUD Mirror

Of the 32 companies nominatated, 22 are OESA supplier members.

Mark your calendar for April 3, 2017 for the black tie awards ceremony as we recognize new cutting-edge technology developed by the supplier community.

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OESA EVENTS OESA Board of Directors Chairman of the Board Mike Mansuetti* President Robert Bosch LLC Immediate Past Chair Samir Salman* CEO NA Region Continental Automotive Systems, Inc. Vice Chairman Michael E. Martini* President Consumer OE Bridgestone Americas Vice Chairman Ramzi Hermiz* President and CEO Shiloh Industries Officer Julie A. Fream* President and CEO Original Equipment Suppliers Association Officer Steve Handschuh* President and CEO Motor & Equipment Manufacturers Association *Executive Committee

Directors Oscar Albin Executive President INA, Industria Nacional de Autopartes A.C. Paul Barnett President Principal Manufacturing James Bradbury President Grand Rapids Controls Company LLC Françoise Colpron Group President Valeo North America Frederick Cartwright Executive Director Clemson University International Center for Automotive Research (CU-ICAR) David C. Dauch Chairman and CEO American Axle & Manufacturing, Inc. (AAM) (Continued on page 7)

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29TH ANNUAL CANADA/U.S. AUTOMOTIVE DINNER | MAR. 6 The 29th Annual Canada/U.S. Automotive Dinner will be held on March 6, 2017, at The Henry Ford Museum of American Innovation in Dearborn, Mich.

Hau Thai-Tang, group vice president, global purchasing, Ford Motor Company, will deliver this year’s keynote address on the future of the automotive industry and Ford's role as a mobility company.

This event is organized in cooperation with the Automotive Parts Manufacturing Association (APMA), and the Consul General of Canada, Detroit.

Register onsite at the museum. Doors open at 6 p.m. ► KEYNOTE SPEAKER PARTNER

► SUPPORTING PARTNERS

WARRANTY 2017: TERMS, TRENDS AND BEST PRACTICES IN COMPLICATED TIMES | MAR. 30 OESA, in partnership with Brooks Wilkins Sharkey & Turco PLLC and Clark Hill PLC, is pleased to announce Warranty 2017: Terms, Trends and Best Practices in Complicated Times. The event will be held on March 30, 2017, at the MSU Management Education Center in Troy, MI, for an analysis and discussion of the most important terms, trends and tactics impacting warranty management for suppliers.

This event is geared toward anyone involved in understanding and managing warranty and warranty costs, from sales to warranty specialists.

All registered participants will receive a copy of the “2017 OESA Comparative Analysis of North American Warranty Programs.”

Based on results from a recent OESA survey, supplier interviews and practical experience, presenters Linda Watson and Daniel Dulworth, equity partners and co-chairs of the automotive practice group at Clark Hill, PLC, and Bert Donovan and Matt Letzmann, partners at Brooks Wilkins Sharkey & Turco PLLC, will share up-to-the-minute insights into how warranty is shaping risks, costs and relationships today. ► SUPPORTING PARTNERS

OESA EVENTS

OESA MEMBERS-ONLY RIVIAN AUTOMOTIVE TOWN HALL MEETING | APR. 12

OESA Board of Directors

Rivian Automotive will hold its first Town Hall for OESA members with RJ Scaringe, founder and CEO, Rivian Automotive and members of the Rivian Purchasing & Engineering teams on April 12, 2017, at the Laurel Manor in Livonia, Mich.

Paul Doyle CEO Coastal Automotive

Rivian is an automotive technology company focused on designing, engineering and producing a portfolio of vehicles for the transition to future mobility. At the current stage of its vehicle program, and after the acquisition of the former Mitsubishi assembly plant in Normal, Ill., Rivian Automotive is actively engaging suppliers to source critical components. The purpose of this meeting is to provide OESA members with a unique opportunity to learn about the needs and opportunities with Rivian.

A brief presentation by RJ Scaringe and Larry Achram, chief engineer, will be followed by a Q&A session. Rivian purchasing and engineering executives from the component and systems groups will be available following the meeting for networking and one-on-one meetings. ► SUPPORTING PARTNER

(Continued from page 6) Jacqui Dedo Co-Founder Aware Mobility, llc

John Dunn President and CEO, The Americas, Plastic Omnium Auto Inergy Division Douglas J. Grimm President and COO MPG Michael Haughey President North American Stamping Group, LLC Ken Hopkins President and CEO Neapco Holdings, LLC Don Manvel Chairman AVL Americas Chris Obey President, Automotive Flex Lon Offenbacher President and CEO Inteva Products

SURFACE COATING CONVERSATION – THE IMPACTS OF OEM REQUIREMENTS APR. 18 Join the conversation on the impact of OEM requirements relating to surface coating and treatments. The purpose of this meeting, to be held on April 18, 2017, at the OESA Conference Center in Southfield, Mich., is to determine potential next steps in addressing this issue. Member participation in this meeting will help shape MEMA divisions activities in this area for the future.

Business-to-business suppliers are frequently required to surface coat products in accordance with customer specifications. Many customer specifications require surface coatings that can be environmentally detrimental, which can lead to increased scrutiny by regulatory agencies and non-governmental organizations (NGOs).

Michael Rayhill President Jiffy-Tite Company, Inc. Michael Robinet Managing Director Automotive Advisory Services IHS Markit Dan Sceli President and CEO Peterson American Corporation Wes Smith President and CEO E & E Manufacturing Co., Inc. Armando Tamez CEO Nemak Jim Teets President and CEO ADAC Automotive James Verrier President and CEO BorgWarner Inc.

For all events, register in the events section of www.oesa.org.

For additional information, contact OESA at 248.952.6401 or info@oesa.org.

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FORMERLY

SMART & SUSTAINABLE URBAN MOBILITY FOR ALL: FROM AMBITION TO ACTION June 13 -15, 2017 | Montréal, Canada

SAVE THE DATE JUNE 13-15, 2017

Movin’On is the international summit on sustainable mobility, convening representatives from the business, academic and governmental spheres.

THEMES

The 2017 edition will take place in Montréal, Canada, in partnership with the international business conference C2, which will bring more collaborative activities, action-focused content and further openness to all mobility stakeholders.

New mobility experiences

This global summit, enriched with high caliber forward-looking talks, collaborative activities and action-oriented ideation sessions, will convene 3,000+ mobility stakeholders of today and tomorrow from more than 35 countries to discuss and advance the future of mobility.

WHAT’S IN IT FOR YOU?

Public and private organizations, academia and startups will join city representatives to launch initiatives toward sustainable mobility.

Energy efficiency and safety improvements Investment and regulatory policies

Moonshots in mobility The circular economy Digital and artificial intelligence levers

→ 20,000 square meters of immersive environment → World renowned speakers and thought leaders → 50+ collaborative workshops, masterclasses and labs → Peer-to-peer learning and networking → Innovation Center and Ride & Drive showcasing the latest technologies

CONTACT: Michael Marchand Director, New Business Development, OE Passenger Car & Light Truck Tires, Michelin North America 248.649.8270 mike.marchand@michelin.com

Matthieu Bonardel Program Director MOVIN’ON – Michelin +1.864.252.5628 matthieu.bonardel@michelin.com

Marc Gonnet Operational Director MOVIN’ON – Michelin +33 (0)6 07 89 40 73 marc.gonnet@michelin.com Caroline Duret Project Manager – C2 +1.438.498.8886 cduret@c2.biz

JOIN THE MOVEMENT, UNDERSTAND SOCIETAL TRENDS, BUILD NEW OPPORTUNITIES AND COMMIT TO IMPACT DRIVEN ACTIONS THAT WILL SHAPE THE FUTURE OF MOBILITY. FOR MORE INFORMATION

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→ Visit movinon.michelin.com

→ Contact letsmove@c2.biz

OESA EVENTS

CALENDAR OF EVENTS UPCOMING EVENTS Mar.

06

Mar.

30

Apr.

03

29th Annual Canada/U.S. Automotive Dinner The Henry Ford Museum of American Innovation Dearborn, MI Warranty 2017: Terms, Trends and Best Practices in Complicated Times MSU Management Education Center Troy, MI

Apr.

12 Apr.

18

OESA Members-Only Rivian Automotive Town Hall Meeting Laurel Manor Livonia, MI Surface Coating Conversation – The Impacts of OEM Requirements OESA Conference Center Southfield, MI

PACE Awards Ceremony Max M. and Marjorie S. Fisher Music Theater Detroit, MI

UPCOMING OESA COUNCIL MEETINGS* Mar.

Chief Information Officers Council OESA Conference Center Southfield, MI

Mar.

Tooling Council Meeting OESA Conference Center Southfield, MI

Mar.

OESA Young Leadership Council 4 OESA Conference Center Southfield, MI

Mar.

Chief Financial Officers Council OESA Conference Center Southfield, MI

07 08 09 16

Mar.

22

Mar.

23

Mar.

30

Board of Directors Meeting OESA Conference Center Southfield, MI Small and Medium Enterprise Presidents Council Meeting OESA Conference Center Southfield, MI Warranty Management Council MSU Management Education Center Troy, MI

*Open to peer group council members & invited guests.

For more information and to register for events and council meetings, visit oesa.org, or call OESA at 248.952.6401.

OESA News - 2017 First Quarter

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248.430.5964 abuford@oesa.org

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