OESA News 2020 - First Quarter - Edition 2

NEWS Original Equipment Suppliers Association

2020 First Quarter │ Edition 2

Warner Norcross + Judd Automotive Supplier Legal Hot Topics | February 12, 2020

IN THIS ISSUE...

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The Suppliers' Voice MEMA News Supplier Barometer

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RSM Supplier Barometer Commentary OESA Events

10 OESA Council Highlight 11 Welcome New OESA Members 13 OESA Event Calendar

Voice

The Suppliers’

OESA's Strategic Direction

As members of OESA recognize, the association’s mission is to champion the business interests of the automotive supplier community. As the industry continues to evolve, so must the association. Every year, the OESA Board of Directors and staff evaluate the needs of the member base and set the strategic direction enabling OESA to effectively support the member organizations.

In 2020, the four pillars of OESA’s strategic direction are: 1. CONNECT Fostering strong relationships throughout the supply chain remains a core function for OESA. OESA is committed to strengthening OEM-supplier and supplier-supplier relations and to building stronger bonds with industry entrants. In 2020, OEM Town Halls will feature additional OEM functions, such as vehicle design and manufacturing. Additionally, the “OESA Industry Disruptor Series” – which recently presented Rivian, Canoo and Karma – will feature both OE and supplier organizations that are changing the industry’s landscape.

2. ENGAGE With more than 800 supplier executives engaged in the OESA Peer Group Councils, council activity is a valuable asset for many members. OESA's goal for 2020 is to grow council membership and attendance by continuing to provide relevant speakers and insight. This year we are also launching the “OESA Master Class Series” to support the engagement and development of the next generation of supplier executives.

3. PROVIDE INSIGHT OESA continues to educate and advocate on legislative and regulatory issues impacting the supplier community. Together with the MEMA team in Washington, D.C., we will feature new events and webinars on tariffs and trade, including the USMCA. Other initiatives include more web content and podcasts on industry trends and strategic insights.

4. COMMUNICATE OESA continues to evaluate new ways to improve member communication. The new OESA Engagement App puts the power and value of OESA membership on mobile devices. OESA will also expand into new social media channels to broaden communication with members.

These are just a few examples of how OESA will deliver increasing membership value in 2020. OESA is proud to be the voice of automotive suppliers.

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

Julie A. Fream President and CEO OESA 1 │ OESA News - 2020 First Quarter

If your organization is interested in being featured in the “OESA Industry Disruptor Series.” contact April Buford at abuford@oesa.org or 248.430.5964.

OESA will highlight organizations that are delivering “what’s next” in automotive.

MEMA NEWS

MEMA Shares the Latest in Automotive Trade News USMCA MEMA’s Bill Long and Ann Wilson were honored to attend the White House signing ceremony of the USMCA agreement in late January. The President’s signature signaled a new day in U.S. trade policy and a major milestone for the industry.

In other trade news: GENERALIZED SYSTEM OF PREFERENCES – (GSP) • The USTR held two days of hearings that could lead to a suspension or reduction of trade benefits for eight countries under the Generalized System of Preferences program. The countries under consideration are Thailand, Ecuador, Azerbaijan, Uzbekistan, Kazakhstan and Georgia, South Africa and Indonesia.

SECTION 232 STEEL AND ALUMINUM • The Commerce Department recently released two annexes describing what products would be subject to a decision to expand the Section 232 tariffs to items that derive at least two-thirds of their value from steel and aluminum.

INDIA • The United States Trade Ambassador Robert Lighthizer is expected to travel to New Delhi in early February to finalize a limited trade deal with India.

• The following issues are likely be part of the package: tariffs on Harley-Davidson motorcycles, getting rid of price caps for U.S.-built medical devices, and granting more market access for U.S. dairy products, cherries, pork, hay and distillers dried grains. The deal could also include provisions to strengthen intellectual property protections.

•

India is looking for full restoration of its participation in the Generalized System of Preferences.

For additional information, please visit mema.org/trade or contact the MEMA Government Affairs team in Washington, D.C. for assistance: •

Ann Wilson, Senior Vice President, Government Affairs - 202.312.9246 | awilson@mema.org

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Bill Frymoyer, Vice President, Public Policy - 202.312.9253 | bfrymoyer@mema.org

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Catherine Boland, Vice President, Legislative Affairs - 202.312.9241 | cboland@mema.org

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Leigh Merino, Vice President, Regulatory Affairs - 202.312.9249 | lmerino@mema.org

Ann Wilson Senior Vice President, Government Affairs, MEMA

Bill Long President and CEO MEMA

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OESA SUPPLIER BAROMETER

Protracted Uncertainty Continues to Weigh Down Sentiment Mike Jackson Executive Director, Strategy and Research 248.430.5954 │ mjackson@oesa.org

According to the Q4 2019 OESA Automotive Supplier Barometer Index (SBI) – a gauge to measure the sentiments of North American automotive supplier executives – supplier pessimism continues to weigh upon the automotive supply base. Results posted a negative reading of 37 for the period; 13 points below a neutral reading of 50. The Q4 2019 index marks the sixth straight quarter of net pessimism and is two points lower than a year ago.

Despite uncertainty, leading suppliers recognize the need to proactively engage employees and communities, to attract, retain and develop workplace talent. This equally true for college educated employees as for skilled trade team members on the shop floor in today’s tight talent market. Executive teams are promoting dialogue and embracing feedback to demonstrate flexibility, align company culture and reskill where appropriate. Leading organizations of all sizes are expanding efforts to foster skill development and strengthen career planning.

The high degree of pessimism is attributed to ongoing trade tensions, volume declines, and the recent United Auto Workers (UAW) strike at General Motors. Survey sampling was conducted in late October while the UAW strike at General Motors was still in process. Pessimism was shared across suppliers of all revenue sizes but the larger, more globally-exposed suppliers were more pessimistic in comparison.

The Q4 2019 OESA Supplier Barometer, sponsored by RSM US LLP, focused on HR and Talent.

The results indicate: • Trade policy remains the greatest industry threat to automotive suppliers, however there were substantial increases in volume risk and weakness in the U.S. economy.

• Regional voluntary turnover rates are extremely high throughout North America, and the availability of skilled workers remains scarce. Firms are focusing on internal development to cope with staffing issues.

• The industry is striving to attract younger workers with greater emphasis on schedule flexibility and cross-functional job rotation.

• Organizational leadership, communication and empowerment are the top HR priorities heading into 2020.

Suppliers are developing future leaders internally through mentorship and cross-functional job rotation programs.

Click here to view the Q4 SBI Chart and the full copy of the Supplier Barometer results.

Commentary from RSM US LLP on the Q4 2019 OESA Supplier Barometer results can be found on page 5.

About the OESA Automotive Supplier Barometer: The OESA Automotive Supplier Barometer captures the pulse and analyzes the twelve-month business sentiments of top executives in the supplier industry. It is a quarterly survey on commercial issues, the business environment and strategies that influence the supplier industry. This Barometer is distributed to vehicle manufacturers, financial institutions, governmental officials and the media to provide an on-going profile of supplier industry trends.

Contact Mike Jackson to learn more about the quarterly Automotive Supplier Barometer. He can also provide information on economic and industry trends and the CFO and CPO Councils.

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OESA SUPPLIER BAROMETER

OESA News - 2020 First Quarter

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GUEST COLUMN

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OESA EVENTS Warner Norcross + Judd Automotive Supplier Legal Hot Topics / Feb. 12 Automotive supplier attorneys and senior supplier executives are invited to attend the “OESA 2020 Warner Norcross + Judd Automotive Supplier Legal Hot Topics” meeting on February 12, 2020, at the MSU Management Education Center in Troy, Mich. The session offers legal insight into trends that supplier executives need to understand and prepare for as the industry continues to evolve. Seasoned automotive supply chain attorneys from Warner Norcross + Judd will discuss current legal topics to help suppliers prepare for potential industry disruption including: Opportunities Amid Distress Linda Paullin-Hebden, Executive Partner, and Dennis Loughlin, Partner, Warner Norcross + Judd, will discuss opportunities to acquire distressed suppliers and customers. Although these can be attractive investments, it is important to successfully navigate the inherent pitfalls. Learn about these opportunities and best practices in acquiring distressed suppliers and customers both in and out of bankruptcy, while managing the risks of these transactions.

The Environmental Agenda Kurt Kissling, Partner, Warner Norcross + Judd, will discuss some of the key environmental issues impacting the automotive industry, including recent and future developments at the local, state, and federal level.

Marijuana and the Workplace: Employer Obligations and Workplace Health and Safety Steve Palazzolo, Senior Counsel, Warner Norcross + Judd, will share how suppliers can navigate labor and employment issues including obligations and workplace health and safety with regards to medicinal and recreational marijuana.

How to Conduct an Internal Investigation and New Trends in Criminal Enforcement Michael Brady, Partner, and Madelaine Lane, Partner, Warner Norcross + Judd, will discuss best practices for conducting internal investigations and will address new trends in potential criminal exposure, including the Foreign Corrupt Practices Act (FCPA), environmental enforcement actions and immigration (I-9) prosecutions of employers.

This session will shed light on recent developments and trends that automotive supplier attorneys and senior executives should understand and prepare for as 2020 gets underway.

Exclusive Sponsor:

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.

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OESA EVENTS OESA/CAR 2020 The Mobility Web: Joining Forces to Build the Future / March 11 OESA and the Center for Automotive Research (CAR) have partnered to host the 1Q 2020 Mobility Supplier Forum titled, "The Mobility Web: Joining Forces to Build the Future," on March 11, 2020, at HPE Campus in San Jose, Calif. Auto industry experts, community leaders and start-up company executives will discuss how they are collaborating to build the future of the mobility.

Keynote speakers John Rich, chief operating officer, Ford AV, LLC, and Brett Roubinek, president & CEO, Transportation Research Center, will share their unique perspectives on the evolution of collaboration in the automotive industry.

Alex Thibault, vice president and general manager, North America, Vulog, will share his perspective on how partnership decisions are made and what companies have learned from these partnerships to date.

The "Smart City Mobility" Initiatives session will cover the technologies smart cities are deploying, the role of multimodal transportation, and outcomes municipalities are experiencing. Speakers include Jordan Davis, director, Smart Columbus, Columbus Partnership, Amanda Graor, chief innovation officer, Mid-America Regional Council, Alex Pazuchanics, mobility services manager, City of Seattle, and Karina Ricks, director of mobility and infrastructure, Greater Pittsburgh Area.

Differing clock speeds between automakers and technology companies make industry startup partnerships difficult, yet essential to move through the massive technology shift underway within the industry. A panel of leading automotive supplier and startup executives will explore how this process has played out for manufacturers and startups alike.

Panelists include: • • • • •

Jeff Davis, Senior Director, Connected Transportation, BlackBerry Jim Douglas, President and CEO, Wind River Todd Fletemier, Vice President, Midwest Technology Platform, Faurecia North America Ashok Sivanand, CEO, Integral Marc Smeyers, Chief Technology Officer, GHSP ​​

Automotive suppliers looking for insight into the latest in automotive technology and tech companies that are exploring entrance into the automotive industry are encouraged to attend these forums.

In Partnership With:

OESA members and industry guests may register in the events section of http://www.cargroup.org. For registration assistance, contact CAR at 734.662.1287 or info@cargroup.org.

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OESA EVENTS OESA 2020 Industry 4.0 Executive Breakfast Briefing / March 17 Modern manufacturing enterprises need to be agile and operate with the ability to adapt to consumer preferences in advance of customer demand requirements. The objective of Industry 4.0 is to develop manufacturing to be faster, more efficient, and customer-centric while pushing beyond automation and optimization. To help OESA members assess existing manufacturing operations against leading Industry 4.0 concepts, OESA is hosting “Industry 4.0: Gauging Your Enterprise Capabilities and the Power of Integration” on March 17, 2020, at the MSU Management Education Center in Troy, Mich.

Competing in the world of Industry 4.0 depends on a manufacturer’s ability to adopt technologies like machine learning and analytics, artificial intelligence (AI), IoT devices, and automation – then scale those technologies across the organization. Peter Pearce, principal and mobility and transportation practice leader at Baker Tilly, will share leading manufacturing practices of Industry 4.0 and help suppliers understand the power of data integration across the Industry 4.0 operating dimensions.

Attendees will learn the power of secure enterprise integration and how to bring shop floor and operational costing data together to enhance operational visibility and performance. Then determine the roadmap to move their operational footprint into the higher echelons of Industry 4.0 maturity.

Supplier executives responsible for managing or overseeing engineering, product development, innovation, new technology activities or manufacturing operations will gain a better understanding of how Industry 4.0 concepts can impact their organization.

Exclusive Sponsor:

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.

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COUNCIL HIGHLIGHT

Communication Executives Council (CEC) Addresses the MarComm Issues of Supplier Organizations Senior level supplier communications and marketing executives are invited to learn more about the OESA Communication Executives Council (CEC). The council is designed to help members address some the most pressing issues for this unique functional role with industry peers.

Members of the CEC meet quarterly to hear from subject matter experts, network with each other, and discuss member-selected topics during lively roundtable discussions. Added benefits of CEC membership include press credentials for the annual North American International Auto Show for members and their senior leadership, free access to the annual OESA MarComm Summit, and frequent requests from media to comment on relevant industry topics to increase brand awareness.

The CEC has two joint meetings with the OESA Automotive Public Relations Council (APRC) to expand dialogue and to gain access the supplier industry's expertise in public relations. Recent meeting discussions include: • • • • • • •

Global and plant communications Legalities of social and digital media Media relations with OEMs B2B marketing strategies The art of storytelling Developing and measuring digital marketing initiatives Social media strategies

The first meeting of 2020 will be held on February 5th at the OESA Conference Center in Southfield, MI. The agenda will feature: • OESA Legal Counsel Antitrust Review with Katie Pullen, Attorney, Warner Norcross + Judd • MEMA Washington, D.C. Update presented by Bill Frymoyer, Vice President of Public Policy, Motor & Equipment Manufacturers Association • Economic Update and Market Outlook with Mike Jackson, Executive Director, Strategy and Research, Joe Zaciek, Manager, Research & Industry Analysis, OESA Click here for meeting details and the full agenda.

Remaining 2020 meetings: • April 15 • July 22 (Joint with APRC/MarComm Summit) • November 18 Supplier communications executives are welcome to join the council or audit a meeting, contact OESA for details.

Learn more about the OESA Communications Executive Council, visit oesa.org or contact April Buford at abuford@oesa.org or call 248.430.5964. Eligibility is available to the most senior person in the communications role at the supplier companies.

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WELCOME NEW OESA MEMBERS Asia Forging Supply

11501 Metro Airport Center Dr, Ste 200 Romulus, MI 48174 734.961.8822 www.asiaforging.com Member Representative: Keith Ratliff, President and CEO Alternate Representative: Jeremy Ratliff, Sales

Contemporary Amperex Technology, Inc.

2114 Austin Ave Rochester Hills, MI 48309 248.289.6200 www.catlbattery.com Member Representative: Michael O'Neill, N.A. Sales Director Alternate Representative: Allan Wang, General Manager

ESTIC America, Inc.

FICO

The Genesee Group

Gestamp

ISG - Information Services Group

Kamax

Melecs USA Corp.

NEXEN Tire America Inc.

1895 Airport Exchange Blvd Ste 220 Erlanger, KY 41018 248.880.1128 www.estic.co.jp Member Representative: Don Seay, General Manager Alternate Representative: Takeo Fukui, Managing Director

1102 N. Averill Flint, MI 48506 248.514.1883 www.genpackaging.com Member Representative: Jane Worthing, CEO Alternate Representative: Ken Miller, Sales Manager

2187 Atlantic St Stamford, CT 06902 513.668.7493 www.isg-one.com Member Representative: Scott Sanders, Director Alternate Representative: Dave Lewis, Partner

3201 University Dr, Ste 150 Auburn Hills, MI. 48326 248.972.2301 www.melecs.com Member Representative: Adrian Sargeant, CEO

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181 Metro Dr San Jose, CA 95110 734.634.0958 www.fico.com Member Representative: Leon Black, Client Partner

2701 Troy Center Dr, Ste 330 Troy, Michigan 48084 248.824.4705 www.gestamp.com Member Representative: Susana Tello, Director of Communications and Public Affairs

1606 Star-Batt Dr Rochester Hills, MI 48309 248.928.4197 www.kamax.com Member Representative: Mark Mahaffy, Vice President, Sales Alternate Representative: Mark Hilfinger, CEO

4014 Wheatley Rd Richfield, OH 44286 330.408.5374 www.nexentireusa.com Member Representative: Walden Cho, General Manager Alternate Representative: Celina Kim, Administrator

WELCOME NEW OESA MEMBERS Sakuma International America, Inc.

Seres

Sinfonia Technology (America), Inc.

Sistemas Mecatrónicos InTiCa

Smithers

Uniseal

410 N. Cedar Bluff Rd,Ste 203 Knoxville, TN 37923 865.999.2786 www.sakuma-skia.com Member Representative: Chris Paz, General Manager

4043 Clipper Ct Fremont, CA 94538- 6540 408.235.8684 www.sinfo-t.jp Member Representative: Kaname Umezu, Vice President, North America Alternate Representative: Patrick Bray, Sales

1001 Woodward Avenue, 5th Floor Detroit, MI 48226 586.453.9430 www.smithers.com Member Representative: Todd Hain, Marketing Director Alternate Representative: Jim Popio, Vice President, Operations

Join OESA Today!

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

3303 Scott Blvd Santa Clara, CA 95054 www.driveseres.com Member Representative: Bill Zhang, Business Development Strategy

Av. Mina de Guadalupe #838 Col. Parque Industrial Santa Fe IV, C.P. 36275 472.689.0314 www.intica-systems.com Member Representative: Aldo Flavio, Sales Director

1014 Uhlhorn St Evansville, IN 47710 734.735.0984 www.uniseal.com Member Representative: Michael Sislo, Vice President, Sales Alternate Representative: Jeff Nance, Business Development Manager

For membership information, contact: Steve Horaney Vice President, Membership and Sales 248.430.5969 shoraney@oesa.org OESA News - 2020 First Quarter

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OESA EVENTS Upcoming OESA Events Feb. 12

OESA 2020 Warner Norcross + Jude Automotive Supplier Legal Hot Topics

Mar. 11

OESA/CAR 2020 The Mobility Web: Joining Forces to Build the Future

Mar. 17

OESA 2020 Industry 4.0 Executive Breakfast Briefing

MSU Management Education Center, Troy, MI

HPE Campus, San Jose, CA

MSU Management Education Center, Troy, MI

Upcoming Council Meetings: Feb. 5

Automotive Public Relations/Communication Executives Joint Council

Feb. 20

Sales Executive Council

OESA Conference Center, Southfield, MI Somerset Inn, Troy, MI

Upcoming 2020 OESA Town Hall Meetings Mark your calendar for the Members-Only OEM Town Hall Meetings

May 5, 2020

VW Town Hall - Save the Date

July 28, 2020

Toyota Town Hall - Save the Date

Aug. 19, 2020

FCA Town Hall - Save the Date

Nov. 19, 2020

Nissan Town Hall - Save the Date

Dec. 3, 2020

Ford Town Hall - Save the Date

Troy Marriott, Troy, MI

Toyota Supplier Center, York Twp, MI Suburban Collection Showplace, Novi, MI Metro Detroit

The Henry Hotel, Dearborn, 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.

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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 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