OESA News 2019 Fourth Quarter Edition 1

NEWS Original Equipment Suppliers Association

2019 Fourth Quarter │ Edition 1

2019 Automotive Supplier Conference Featuring Jim Collins, Author, "Good to Great”

Wednesday, November 13, 2019 • Suburban Collection Showplace • Novi, MI

Hear from industry thought leaders from...

IN THIS ISSUE...

2 4 5 7

The Suppliers' Voice MEMA News Technology Update Guest Column: Deloitte

9 Welcome New Members 11 OESA Events 14 Council Update

This edition is sponsored by:

Register Now! Advance Pricing Ends October 11th!

The mobility industry...recalculating.

With disruption all around us, standing still is not an option.

The automotive industry is experiencing disruption as technology and user behavior is transforming traditional vehicle manufacturing. Significant model disruption in the mobility sector will continue as new players enter the industry and others adapt and embrace the changes. Success happens when we push forward. With more than 34,000 colleagues in 746 offices worldwide, we are here to serve you.

Now, for tomorrow.

advisory. tax. assurance. | bakertilly.com

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SUPPLIERS' VOICE

Voice

The Suppliers’

Join us at the 2019 OESA Automotive Supplier Conference The OESA team is looking forward to hosting more than 700 automotive executives at the 2019 OESA Automotive Supplier Conference, and we hope you will join us. The annual conference will feature leading business and industry thought leaders to discuss the outlook of automotive and actionable insights on the industry’s latest trends, opportunities, and challenges.

Confirmed Speakers:

Mitch Bainwol

Elaine Buckberg

Jacqui Dedo

Bill Foy

Mike Jackson

Brian Johnson

Jeff Jorge

John McElroy

Bryan Reimer

Jeff Schuster

Ford Motor Company

Leadership expert Jim Collins, author of “Good to Great” will discuss what companies must do to thrive in the new mobility era.

Julie A. Fream President and CEO OESA

Barclays

Deb Schroeder Toyota

General Motors

Baker Tilly

Scott Thiele FCA - North America

Aware Mobility, LLC

Autoline

Denso International America

MIT

Dustin P. Walsh Crain's Detroit Business

OESA

LMC Automotive

Ann Wilson MEMA

The event will be held on Wednesday, November 13, 2019, at the Suburban Collection Showplace in Novi, MI. We hope you will join us for this thought-provoking day.

For additional information and to register for the conference, visit oesa.org or call 248.952.6401.

Register before October 11 to take advantage of the best pricing.

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

Julie A. Fream President and CEO OESA OESA News - 2019 Fourth Quarter

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2019 Automotive Supplier Conference November 13, 2019 • Suburban Collection Showplace • Novi, MI

Featuring Jim Collins, Author, “Good to Great” and “Built to Last”

The OESA 2019 Automotive Supplier Conference explores the industry’s landscape and offers actionable insights for suppliers to thrive in the dynamic and uncertain mobility envrioment.

Conference Highlights: • • • • • •

Morning keynote speaker, Jim Collins, author, “Good to Great” Insights from OEM Executives Economic Outlook Panel Purchasing Executive Panel Trade & Tariffs and Advanced Technology Breakout Sessions Morning Sessions by Anaplan and Baker Tilly

Register to attend at OESA.org

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MEMA NEWS

An Evolving Trade Environment Creates Challenges for Motor Vehicle Parts Suppliers Ann Wilson Senior Vice President, Government Affairs, MEMA 202.312.9246 │ awilson@mema.org

The international trade environment has become tumultuous, adding significant stress to the supplier industry. From tariffs on $300 billion on imports from China to imposed tariffs on steel and aluminum and threatened tariffs on autos and motor vehicle parts — as well as the renegotiation of NAFTA and threatened tariffs on all goods crossing the border from Mexico – longstanding trade policies and relationships have been set aside and a new era of uncertainty has begun. President Trump may have given a reprieve on China tariffs in June and Mexico tariffs in May, but these actions may not be permanent. The bottom line is that uncertainty seems to be here to stay, and motor vehicle parts manufacturers, who depend on a reliable global supply chain, must adapt.

The Motor & Equipment Manufacturers Association (MEMA) and OESA have been in constant contact with the Trump administration on these and many other trade-related issues.

Our concern, which we have expressed consistently, is that a lack of certainty will cause investments in new autonomous vehicle, artificial intelligence and fuel efficiency technologies to leave the United States. Our message is clear: motor vehicle parts suppliers are the largest sector of manufacturing jobs in the U.S., and supplier jobs will be at risk if our industry cannot compete in the global marketplace. And finally, these uncertainties will increase the cost of vehicles for consumers.

Actions can be taken to minimize the risks and provide the clarity and certainty that is necessary for our industry to continue to thrive and grow.

First, stabilizing trade with our North American neighbors is critical. MEMA/OESA has encouraged Congress to pass the United States-Mexico-Canada Agreement (USMCA) without delay. The USMCA is a winner for the motor vehicle parts manufacturing industry. NAFTA was ready for an update, and the USMCA addresses concerns that have emerged in the last 25 years — such as digital trade, services liberalization, state enterprise restriction, and even addresses labor and environmental issues. Every other major manufacturing hub around the world has a similar trade agreement with its neighbors. It is critical that U.S. companies can grow with a stable, reliable trade agreement with Mexico and Canada.

Second, although President Trump has lifted Section 232 tariffs on steel and aluminum from Canada and Mexico, these metals tariffs are still in place on important trade partners such as the EU and Japan. Section 232 tariffs on autos and motor vehicle

parts, from these trade partners and others, are still possible.

Our message to the Trump administration has been consistent in this case as well: tariffs are taxes on U.S. companies, and the burden these tariffs do or could place on businesses in the United States puts them at a disadvantage. The United States could lose its ability to lead the world in new technologies that save lives and the environment and create high-quality, dependable jobs.

Third, MEMA/OESA has long argued that China has been engaging in unfair and unethical trade practices, including IP theft and forced technology transfers. We support the administration’s goal to put an end to these practices. MEMA encourages the two parties to develop a trade deal that will restore this important trade relationship while protecting U.S. companies and their valuable intellectual property. We are encouraged that the two countries are talking and that hopes of a workable trade deal are still high.

Finally, President Trump took many of us by surprise when he announced he would impose a five-percent tariff on all goods coming across the border from Mexico, with the plan to increase that tariff every month until Mexico stopped the flow of illegal immigrants into the United States. That threat was lifted – even if temporarily — when a deal with Mexico was announced in June. This action would have been particularly hurtful to motor vehicle parts manufacturers. As the 90-day mark approaches, we are keeping a close eye on the administration and urging them to end this tariff threat.

As I have said many times, if you are not at the table, you are on the menu. OESA members, via MEMA, are indeed at the table.

Talks with legislators and the Trump administration on these and other issues continues daily. We understand these are complex — and even emotional — issues for many Americans. We will make sure that our members are represented well, and we will continue to advance the business interests of motor vehicle parts manufacturers, who are such a critical part of the U.S. economy.

“OESA members, via MEMA, are indeed at the table.”

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TECHNOLOGY UPDATE

Advanced Vehicle Technology: Electrification, Advanced Safety Systems, and Automation Brian Daugherty Chief Technology Officer, MEMA 248.430.5966 │ bdaugherty@mema.org

As we rapidly move through 2019, we are witnessing a global vehicle powertrain revolution unlike anything previously seen. More than $300 billion in electrification investments have been announced by automotive OEMs around the world in order to make their fleets more fuel efficient and comply with increasingly stringent fuel economy regulations. As a result, we will see many more hybrids and fullbattery electric vehicles (BEVs) in the next few years.

While the future growth rate of BEVs is the subject of many forecasts and much debate, powertrains are definitely changing and the impact will be significant.

I think that we’ll see rapid growth in global hybrid volumes as OEMs work to meet the regulatory demands for fuel economy improvement. Most of the hybrid volume growth will be at the low-cost end of the hybrid spectrum in the form of stop-start technology and 12- or 48-volt mild hybrid systems.

BEV volumes in the near term will likely continue to grow at a steady rate rather than a sharp “S-type” curve due to the cost differential versus internal combustion engines or hybrids along with uncertain consumer acceptance. While battery cell and pack costs have declined significantly, they still result in a price penalty versus Internal Combustion Engine (ICE) powertrains. Much of the BEV growth over the next few years will be due to government policy.

Globally, countries with the highest percentage BEV sales either have large incentives or — as in the case of Norway and China — have large disincentives in the form of additional taxes, tolls and registration fees on gasoline- and dieselpowered vehicles.

Advanced vehicle safety system and automation developments also continue to progress rapidly.

While automated vehicles remain very much in the development phase as the leading robo-taxi 5 │ OESA News - 2019 Fourth Quarter

developers try to figure out how to remove their safety drivers, many Advanced Driver Assistance Systems (ADAS) are rapidly becoming standard equipment on new vehicles. With OEMs working to add Automatic Emergency Braking (AEB) on almost all U.S. cars by 2022 and light trucks and SUVs by 2025, more radar- and camera-based technology will soon be on vehicles than ever before. Systems are also getting smarter and more integrated. The “fusing” of camera and radar sensor data results in improved threat detection range and performance by combining the best aspects of each sensor type.

As systems continue moving from issuing warnings to actually assisting drivers, they have become significantly more user-friendly. In addition, many of the newest systems have the ability to “selfcalibrate” while driving and therefore require less precision alignment during installation or repair than previous generations.

Rapid ADAS advancements are not limited to the light vehicle market. I recently had the opportunity to test a number of heavy truck ADAS technologies — both on the test track and on public roads — with two member companies. The systems performed very well and illustrate that ADAS and low-level

automation technology is rapidly advancing in the heavy-duty vehicle space as well. This is important because heavy trucks and commercial vehicles were involved in accidents that resulted in 4,761 fatalities in 2017 — the most recent year that full data is available — which represents a 9% increase from 2016. Of those fatalities, 82% were people in light vehicles or pedestrians. The commercial vehicle market is obviously different in many ways than the light vehicle industry. One major difference is that the end customer is typically a fleet. Fleets are constantly looking for ways to improve both safety and efficiency. If a technology is available that offers either of those effectively — they order it. Most of the large fleets have been quietly testing ADAS technology over the past several years. These tests have demonstrated impressive reductions in the number of collisions and severity when they do occur. As a result, well over 50% of class 8 trucks are now being ordered with ADAS — up from almost none several years ago — and the application rate is expected to continue increasing in the future.

On the light vehicle side, the application rates for ADAS features are much lower. This points out an interesting issue for the light vehicle industry: without educated fleet buyers, how do OEMs and their suppliers convince their end customers to purchase this life-saving technology? More education is one answer, but including multiple, integrated ADAS features as standard equipment — as a number of automakers are now doing — is the most effective solution.

The concept of driverless cars is headline-grabbing and the technologies being developed are very impressive. Someday they may offer significant benefits, but lifesaving ADAS technologies are available today.

Let’s make sure that we don’t let the hype surrounding fully autonomous vehicles distract us from the path to increased ADAS and lower-level vehicle automation that will save many more lives in the near term.

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GUEST COLUMN

DATA ECOSYSTEMS FOR CHANGING MARKET DEMAND Authored By: Peter Pearce Principal, Baker Tilly - Firm Leader Mobility & Transportation peter.pearce@bakertilly.com +1 (248) 368 8838 Contributors: Erich Bergen, Director; Eddie Mulford, Consultant

Over the last 15 years, the automotive industry has gone through massive disruption. This disruption has ranged from new car and ride-sharing models, consumer demand shifts, geopolitical considerations, and a rapid increase in electrified vehicle protection. The industry involved to the point where we refer to it as Mobility and Transportation.

There are two critical elements for any manufacturing business when looking at their products: 1) how much a customer is willing to pay, and 2) the cost to deliver the product over the agreement lifetime. The ability to quickly calculate and leverage each variable in dynamic market conditions is more critical now than ever. Knowing the market price and cost points is challenging, yet planning how to change the manufacturing process ahead of both direct and indirect cost shifts is often a more difficult task. The organization requires an agile business model, effective workforce, and efficient processes in place to adapt to and proactively address evolving change.

ADAPTING YOUR BUSINESS MODEL Data extraction and analysis in the mobility and transportation ecosystem will be a driving force to set a company’s manufacturing capabilities and products apart. Some organizations still struggle to pass information between internal departments, while other organizations can leverage the data they collect to prepare for change and automate processes. The ability to use data as a tool instead of a painful part of doing business can only happen after changing the mindset of each functional team and enabling software systems to connect in a meaningful way. Enterprises need to pivot

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ABOUT BAKER TILLY Baker Tilly Virchow Krause, LLP (Baker Tilly) is a leading advisory, tax and assurance firm with a management consulting practice that offers comprehensive enterprise systems implementation, business integration, industrial analytics and tailored optimized solutions in alignment with Industry 4.0 for the mobility and transportation industries around the globe. Headquartered in Chicago, Baker Tilly is one of the top 15 accounting and advisory firms in the country and is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 180 territories, with more than 36,000 professionals. from data capture to data management and analysis.

RACING FOR DATA TALENT Finding, developing, and retaining a talented workforce fluent in data awareness is growing more difficult, if not impossible. 2.4M of 4.6M manufacturing job openings will go unfilled over the next decade due to a skills gap and retirement (Manufacturing Institute, 2018). When new talent starts, the previous systems expert may have failed to document mission-critical procedures. This is now an alarming situation -- when highly customized business systems designed to meet past needs of the organization now cannot be upgraded without going through an entire reimplementation. Enterprises need to plan, train, and document in the short term for long-term workforce success.

OPERATING YOUR ECOSYSTEM OF DATA Understanding and improving how information moves through an organization can be a complicated task. Figure 1 displays the typical major data systems and movements of information within an ecosystem.

SHAREHOLDERS

Internal Data Systems

PLM

CRM ERP

SUPPLIERS

MES

CUSTOMERS

BI

GOVERNMENT Figure 1: Manufacturing Data Ecosytem

The ERP is the central hub of information and system of record used to report financial performance, surrounded by functional specific software like CRM for sales and MES for production. Time spent manually moving data does not increase customer value, and is more likely to be incorrect. The system landscape becomes increasingly more complex after M&A activity, localization requirements, and unique processing constraints are factored in. Smart factories offer the ability to collect far more data than a traditional plant floor, yet companies struggle to integrate the new data streams into business processes. System integration and communication is the link to operational success. Linking systems requires careful consideration for what directions the information travels to maintain a single source of truth.

When architecting a data ecosystem, future integration or software replacement must be factored in.

A DATA ECOSYSTEM AT WORK In a recent project, a large manufacturer was losing money on $150M in annual sales from hidden costs required to fulfill special orders to customers across 11 distribution sites. Baker Tilly used advanced analytics within Tableau to map data and break down millions of rows of data into a meaningful dashboard. This visual analytics tool allowed the manufacturer’s executive team to identify the main costs associated with the process. Armed with this information, they were able to put in place a series of initiatives centered on people, process, and technology improvements.

Baker Tilly focuses on client value protection and enhancement. We work to ensure that our clients business data processes meet the needs of today and position them for tomorrow.

– Change management, process re-engineering, cost analysis, and business systems architecture – Complex international ERP, CRM, and MES implementations – System integration work with Dell Boomi, RPA, and sequencing – Resourcing strategy based on tax incentives and R&D tax credits – Sales and growth strategy for moving into new markets, domestic and international Learn more about Baker Tilly’s Automotive and Mobility service offerings. For further inquires contact Ryan Holzhueter.

OESA News - 2019 Fourth Quarter

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GUEST COLUMN

Caution ahead: Transformation and disruption for automotive suppliers Summary findings from the 2019 Global Automotive Supplier Study

Over the past decade, automakers—OEMs and suppliers alike—have operated in an automotive market fraught with uncertainty, from the Great Recession to new mobility solutions to unexpected competition.

Senior leaders across the automotive and broader mobility value chain are rethinking businesses entirely, looking for innovative products and solutions with unique appeal to customers.

With massive change still underway, past performance and strategies are no longer a reliable guide to future success. In our fourth Global Automotive Supplier Study, we explore the new and rapidly changing rules of the road with a focus on: • Four disruptive trends • Growing, stagnant, and declining product segments • Strategic options for suppliers to expand, defend, or pivot Four disruptive trends Regardless of diverging opinions on when a future of mobility, where autonomous, electrified, and shared vehicles that rule the road will arrive, most executives would likely agree that the future is coming quickly in response to disruptive trends driven by advancements in technology, new entrants reshaping the automotive value chain, and changing consumer preferences regarding how they choose to move around. We categorize these trends into four themes— electrification, shared mobility, technology convergence, and new entrants.

While each of these forces has already started impacting the industry, it is the convergence of these forces, in combination with looming macroeconomic headwinds, that we believe will cause a dramatic shift in the way automotive suppliers across the value chain compete and, as a result, reshape the automotive value chain itself.

In addition, these forces create the framework for the fourth Global Automotive Supplier Study, allowing for an analysis of where suppliers play today and whether those product segments are positioned to grow, stagnate, or decline, as well as offer a point of view of what automotive suppliers might want to consider in their efforts to expand, defend, or pivot within specific product segments.

Growing, stagnant, and declining product segments According to CapIQ, the total combined revenue of the global automotive supplier market was $1.7 trillion in 2018. Our segment analysis estimates that some segments could face as much as 20 percent in revenue erosion over the next five to seven years while, on the other hand, some higher growth segments could more than triple their current revenues.

However, each part of the automotive ecosystem is impacted differently by the forces driving disruption and transformation, leading to a future where outlooks diverge based on the segments in which suppliers choose to operate. For example, those suppliers driving innovation

Projected segment market size In billions, USD, 2018 vs. 2025 Market size in 2018

$108 $108 $244

$250

$14 $39 $20

$49 $86

$147

$139

$25 $47 $26 $35 $43 $51 $33 $17

Market size in 2025 Electric drivetrain Battery / fuel cell ADAS & sensors Electronics Infotainment & communication Wheels & tires Seats Body Interior Climate control Frame Suspension Transmission ICE Brakes Axles Exhaust system Steering Fuel system

$56 $59

$142 $127 $125

$53 $92 $25 $46 $25 $33 $39 $46 $27 $13

% change

$149

$131

$252

$234

306% 266% 190% 18% 16% 7% 6% 3% 1% 0% -1% -4% -6% -6% -8% -10% -10% -17% -20%

Growth: Total segment revenue expected to grow from 2018–2025 (AEV content/volume, aftermarket, and service) Stagnant: Total segment revenue expected to remain relatively flat from 2018–2025 (traditional content/volume) Declining: Total segment revenue expected to shrink from 2018–2025 Source: Deloitte analysis, 2019 Global Automotive Supplier Study

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in autonomous and electrified systems will likely see the most opportunity and growth (as much as approximately 300 percent in some segments), while those operating in more commoditized automotive supply segments like frames, interiors, brakes, and internal combustion engines could be most at risk as these segments stagnate and decline between now and 2025.

Over the past three years, financial performance of the growth segment far outpaced other segments, OEMs, and the broader market.

Segments with the strongest growth potential and ability to differentiate will be the most attractive: ADAS, infotainment and communication, batteries and fuel cells, electronics, and electric drivetrains. Segments with stagnant or declining growth will be less attractive, even with a strong ability to differentiate—wheels and tires, body, seats, frame, interior, transmission, and ICE. The most risky segments are those with limited ability to differentiate and stagnant or declining growth: climate control, axles, exhaust, suspension, brakes, fuel systems, and steering.

Expand, defend, or pivot: Making moves that matter

Harnessing growth through new technology and fresh product portfolios requires significant investment, even— and sometimes, especially—in highgrowth segments. For more stagnant segments like seating, body, and interiors, innovations for customized, private, and configurable interiors and personalized climate zones offer pathways to innovation and growth. Declining product segments have already started using scale to harvest profits and maximize cash flow through the product decline life cycle.

Suppliers in each segment seeking to expand, defend, or pivot might consider the following moves.

Growth segment Expand Develop and acquire cutting-edge technologies to preserve leadership position Defend Acquire competitors to increase base and maintain growth in shareholder value Pivot Spin off growth businesses from larger parent organizations to focus strategic priorities and resources

Stagnant segment Expand Shift investments toward growth segments and focus resources on high-return product areas Defend Acquire or merge with peers to improve scale benefits and maximize cash flow in stable or lagging segments

What now?

Despite uncertainty around what the future holds and when that future will arrive, we can be certain that the market is not waiting to find out. OEMs, suppliers, and new entrants are clearly signaling continued transformation and disruption ahead, all of which will be exacerbated by prevailing economic headwinds in markets around the world.

Ultimately, the turmoil boils down to a single, simple question: Are you prepared to help your organization navigate the massive transformation already underway and likely to last for decades to come?

To discuss our fourth Global Automotive Supplier Study and implications and opportunities for your company to expand, defend, or pivot, contact our team or visit www.deloitte.com/us/ autosuppliers.

Pivot Align on a long-term strategic direction for the organization and divest business units and products that do not contribute to the strategy

Declining segment Expand Invest in developing markets with less technological advancement Defend Harvest remaining shareholder value within lagging businesses by consolidating and leveraging scale Pivot Sell struggling businesses to competitor or private equity buyer to allow for more radical overhaul

Contacts Jason Coffman US Automotive Consulting Leader Deloitte Consulting LLP jasoncoffman@deloitte.com Neal Ganguli US Automotive Supplier Practice Leader Deloitte Consulting LLP nganguli@deloitte.com Bruce Brown US Automotive and Off-Highway Consulting Leader Deloitte Consulting LLP brubrown@deloitte.com Raj Iyer Senior Manager Deloitte Consulting LLP rajeiyer@deloitte.com

About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities.

DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.

Copyright © 2019 Deloitte Development LLC. All rights reserved.

OESA News - 2019 Fourth Quarter

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WELCOME NEW MEMBERS Android Industries LLC.

CaptureMore

Member Representative: John Doroshewitz, Vice President, Sales Alternate Representative: Katie Viviano, Director Finance

Member Representative: David Burnett, President & CEO Alternate Representative: Sean Brolley, Vice President, Sales & Marketing

Android Industries has a rich history as a manufacturing innovator. From inception, its mission was to be the premier complex module assembler and global supply chain manager.

With a collective 200+ years of manufacturing industry experience, CaptureMore has seen companies struggle to achieve accurate asset information. It saw a better solution and wasn't afraid to break the rules to create it.

2155 Executive Hills Blvd.

Auburn Hills MI 48326 (248) 732-0001 www.android-ind.com

Through the years, Android Industries has proven that exceptional service and game-changing solutions make it possible to raise the bar — over and over again.

413 W. Nine Mile Road Ferndale, MI 48022 (586) 206-2539 www.capturemore.co

After teaming up with a group of tech-experts obsessed with problem-solving, it created CaptureMore: a seamless asset information app bringing customers part-level information for the entire lifecycle of parts.

Edscha North America Technologies, LLC

HP, Inc.

Member Representative: Christian Thiele, CEO/General Manager North American (NAFTA region) Alternate Representative: Neal Welbourne, Business Development Director

Member Representative: Michelle Bockman, General Manager & Global Head of Automotive – 3D Printing & Digital Manufacturing Alternate Representative: David Tucker, Automotive Lead

2800 Superior Court Auburn Hills, MI 48326 (248) 934-2200 www.edscha.com

Edscha is a strategic development partner to the international automobile industry. Under the umbrella of the Spanish automotive supplier Gestamp, it serves almost all motor vehicle manufacturers with products and know-how from 23 world locations with more than 6,300 employees.

In each business unit — body components, powered systems and driver controls — it occupies a leading position among competitors. Edscha is a world market and innovation leaders for door hinges and door checks. In the area of driver controls (such as pedal boxes and foot-operated parking brakes as well as drives for the fully automatic opening and closing of rear lids and liftgates), it ranks among the leading European suppliers of such products.

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1501 Page Mill Road Palo Alto, CA (650) 857-1501

Whether customers are looking to meet today’s needs or tomorrow’s dreams, HP, Inc. can help get the most with its 3D printing capabilites.

It offers a range of support offerings including foundational care and lifecycle support, training opportunities, and productivity services that bring ideas to life and speeds the journey to full digital manufacturing.

WELCOME NEW MEMBERS Musashi North America, Inc.

Royal Technologies Corp.

Member Representative: Edward van Amstel, President, North American Sales & Global Customer Director Alternate Representative: Alejandro Quintero, Vice President, North American Sales

Member Representative: Aaron McClelland, Director of Sales

2000 Town Center Suite 1420 Southfield, MI 48075 (248) 386-1600 www.musashi.co.jp/en/

Musashi Seimitsu Industry Co., Ltd. is a global Tier 1 company for automobiles and motorcycles, with headquarters in Toyohashi, Japan.

It has 33 manufacturing sites spreading across Europe, North and South America, China, and South East Asia. Musashi specializes in designing, developing and manufacturing powertrain products such as differential assemblies, planetary gear assemblies, transmission gears and assemblies, and reduction gears for xEVs, which are supplied to global major OEMs and Tier 1s.

Linkage and suspension products are also strategic products of Musashi.

3765 Quincy Street Hudsonville, MI 49426 (616) 667-3681 www.royaltechnologies.com

Royal Technologies develops, designs, manufactures, and assembles products for industries as diverse as furniture, automotive, firearm, appliance and consumer product markets.

From high-touch, Class-A surfaces to non-visual structural parts, it offers a broad array of applications, with versatility to create everything from safety-critical assemblies to durable, functional garnish and trim.

No matter how simple or complex, Royal Technologies' products are manufactured using principles of lean manufacturing and continuous improvement to provide a distinct competitive advantage and an exceptional level of value to customers.

Musashi is listed on the first section of Tokyo Stock Exchange (TYO: 7220).

Sterling Technologies, Inc.

Vast Production Services

Member Representative: Derek Daskaluk, Business Development Alternate Representative: Daniel Honer, President

Member Representative: Tom Lee, Sales Manager Alternate Representative: Kelly Kohler, Accounting

28024 Center Oaks Ct. Wixom, MI 48393 (248) 669-0334 www.sterlingtech.org

Sterling Technologies Inc. manufactures custom electrical, electronic, and electro-mechanical components and systems for the mobile OEM and automotive service parts markets.

It develops custom-built products that are installed on thousands of on-road and off-road vehicles, and is capable to produce products based on a customer’s drawing / bill of materials. cost, timing, quality is important to clients and it is important to Sterling Technologies, Inc.

Join OESA Today!

Become a member and let OESA champion your business interests throughout the supply chain and in Washington, D.C.

307 Robbins Drive Troy, MI 4808 Phone: (248) 954-4345 www.vastproduction.com

VAST Production Services has proven experience in designing and delivering complete electronic/ electromechanical products, solutions and manufacturing services. Its products range from printed circuit assemblies to complex box builds, controls and systems integration.

VAST specializes in low and medium volume – high mix for surface transportation, industrial products, LED lighting and more.

VAST can manage all facets of the product life cycle.

For membership information, contact: Brenna McCann Senior Manager, Membership and Sales 248.430.5970 bmccann@oesa.org OESA News - 2019 Fourth Quarter

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OESA EVENTS Register Now for the OESA 2019 Webinar: Mexico's Workforce: Your Competitive Advantage / Oct. 29 Automotive manufacturing is undergoing substantive global changes. Mexico manufacturing will be at the forefront of those shifts, due largely to the strengths of its workforce.

Mexico’s workforce is among the most productive and cost-competitive in the world. It’s also well educated.

Mexico graduates an average of 130,000 engineers and technicians each year from domestic universities and specialized high schools (higher than in Canada, Germany or Brazil).

Automotive producers with a Mexico facility or companies that are planning to launch a Mexico operation, are invited to attend Mexico’s Workforce: Your Competitive Advantage webinar on Oct. 29, 2019.

Join OESA and Doug Donahue, principal and V.P., business development, Entrada Group, to learn: • • • • •

Best practices on optimizing a Mexican workforce How public-private partnerships are enabling automotive producers to increase productivity and sustain gains Why regional and sectoral differences in Mexico will affect growth plans How employers have tailored curriculum to support workforce development How companies lacking a Mexico footprint can shortcut their route to Mexico and compete sooner with larger companies

Webinar participants will also have the opportunity to ask questions during the Q&A segment.

Doug Danahue, Principal and V.P., Business Development, Entrada Group

There is no cost for OESA members to participate in this webinar, however, registration is required.

Exclusive Content Provider:

OESA members and industry guests may register for events at www.oesa.org.

For registration assistance, contact OESA at 248.952.6401 or info@oesa.org.

13 │ OESA News - 2019 Fourth Quarter

OESA EVENTS Join Us for the OESA and Harbour Results, Inc. 2019 Automotive Tooling Update / Oct. 30 OESA and Harbour Results, Inc. (HRI) will host the 2019 Automotive Tooling Update on Oct. 30, 2019, at Laurel Manor in Livonia, Michigan. Attendees will receive automotive tooling market intelligence and insights critical for the health of individual shops and the industry.

With the uncertainty surrounding trade and tariffs impacting the tooling supply base, Catherine Boland, vice president, legislative affairs, Motor & Equipment Manufacturers Association (MEMA), will provide an update on the United States-Mexico-Canada Agreement (USMCA), and current U.S tariff actions.

In addition, Cara Walton, engagement manager, HRI, will provide information on current tooling practices and share tooling trends. Additional HRI experts, Nick Stanziola, senior consultant, and Scott Walton, COO, will share actions steps to today to prepare for the future, and why stress testing and using data is critical to a tooling shop’s long-term success.

Laurie Harbour, president and CEO, HRI, will also provide a future industry forecast and host a panel of supplier executives to discuss the impact of technology on the changing industry. Panelists include Jeff Stout, executive director, research technology & new mobility, Yanfeng Automotive Interiors, and Brad Tolley, vice president, strategy & market development, Shiloh Industries, Inc. Terry Woychowski, vice president, Link Engineering, will also share his unique perspective on how the influence of leadership can change the world.

Executives from tool shops who have or are interested in automotive business including tier 1 suppliers, OEM purchasing, and sales, marketing and engineering professionals in the automotive mold and die industry should plan to attend. Thought leadership on the automotive tooling industry, hallmarks of a robust tooling process, best practices and lessons learned will be key takeaways.

Catherine Boland MEMA

Laurie Harbour HRI

Nick Stanziola HRI

Jeff Stout Yangfeng Automotive Interiors

Brad Tolley Shiloh Industries, Inc.

Cara Walton HRI

Scott Walton HRI

Terry Woychowski Link Engineering

Executive Sponsors:

OESA News - 2019 Fourth Quarter

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OESA EVENTS Upcoming OESA Events

Oct. 1

Strategic Insights Executive Briefing Series III

Oct. 29

Mexico's Workforce: Your Competitive Advantage Webinar

Oct. 30

MSU Management Education Center, Troy, MI Webinar

OESA and Harbour Results, Inc. 2019 Automotive Tooling Update Laurel Manor, Livonia, MI

Upcoming Council Meetings:

Oct. 2

Communication Executives Council

Oct. 3

Enterprise Leadership Council

Oct. 8

Legal Issues Council

Oct. 9

Automotive Public Relations Council

Oct. 10

Young Leadership 8 Council Kick-Off

Oct. 15

Young Leadership 7 Council

Oct 24.

Human Resources Council

OESA Conference Center, Southfield, MI OESA Conference Center, Southfield, MI

SAE International's latest book, “The Road to the Top is Not on the Map: Conversations with Top Women of the Automotive Industry,” featuring 36 of the most influential women in the automotive industry including OESA president and CEO, Julie A. Fream, is now on sale!

OESA Conference Center, Southfield, MI OESA Conference Center, Southfield, MI OESA Conference Center, Southfield, MI OESA Conference Center, Southfield, MI OESA Conference Center, Southfield, MI

Visit http://www.sae.org to purchase.

Upcoming OESA Town Hall Meetings Mark Your Calendar for the Members-Only OEM Town Hall Meetings

Dec. 4, 2019

Ford Town Hall - Registration is Open!

Feb. 5, 2020

GM Town Hall - Save the Date

May 5, 2020

VW Town Hall - Save the Date

Aug 20, 2020

FCA Town Hall - Save the Date

The Henry Hotel, Dearborn, MI TBD TBD

Suburban Collection Showplace, Novi, MI

OESA members and industry guests may register for events at www.oesa.org.

For registration assistance, contact OESA at 248.952.6401 or info@oesa.org.

15 │ OESA News - 2019 Fourth Quarter

COUNCIL HIGHLIGHT

Warranty Management Council Ginger Juncker Executive Director, Councils and Member Programs 248.430.5953 │ gjuncker@oesa.org

Automotive supplier warranty professionals are invited to come experience OESA’s Warranty Management Council (WMC).

The WMC is an automotive-centric forum that addresses the unique concerns of warranty professionals. It covers relevant topics such as warranty management data systems and cost recovery processes. Invited OEM representatives address the group at almost every meeting.

The council champions the comparative analysis of OEM warranty programs and supports the warranty audit process certification with AIAG. Recent areas of focus include: • Annual Automotive Warranty Update • Advanced Topics in Warranty Analytics • A Practical Approach to VDA • Leveraging Social Media During Warranty Investigations The next Warranty Management Council meeting is December 5th at the OESA Conference Center.

Scheduled Topics include: • Update on Warranty from Nissan • Risk Analysis Presentation by Reliasoft • FCA Update on New Warranty Program • Workshop on Running Advanced Reports in GM GART System

2020 Meeting Dates: • March 26th • June 25th • September 24th • December 8th

Council membership is available to the senior executives and functional managers responsible for warranty and the warranty process of OESA supplier member companies.

OESA Executive Peer Group Councils are rated as one of the most valuable member benefits for automotive suppliers. OESA's councils are designed to bring together supplier executives with similar job functions and industry challenges. Quarterly council meetings provide a forum to address issues of common concern, share best practices, and hear from industry thought leaders and subject matter experts.

Learn more about the Warranty Management Council and all other OESA Peer Group Councils at oesa.org/councils-and-committees.

To determine eligibility requirements or to be a guest at the WMC Meeting on December 5th, contact Ginger Juncker, executive director, councils and member Services, at gjuncker@oesa.org or 248.430.5953.

OESA News - 2019 Fourth Quarter

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Original Equipment Suppliers Association 25925 Telegraph Rd., Ste. 350 │Southfield, MI 48033-2553 248.952.6401 │oesa.org │info@oesa.org Connect with us on OESA News is provided by members of the OESA Communications Team.

April Buford Senior Director, Communications

Jeff Laskowski Senior Manager, Communications

Abby Napier Communications Specialist

248.430.5964 abuford@oesa.org

248.430.5951 jlaskowski@oesa.org

248.430.5957 anapier@oesa.org