Automotive News Canada - January 2022 - 17

* JANUARY 2022
17
CANADA'S EV FUTURE
ADAPTING TO CHANGE AND SEIZING OPPORTUNITY
JOLT OF REALITY
THERE ARE FEWER PARTS TO EVs
The industry needs to
adapt to new components
and lighter volumes
during the initial ramp-up
of electric vehicles
By DAVID KENNEDY
T ORONTO BUREAU CHIEF
CANADIAN AUTO PARTS SUPPLIERS
are in for some growing pains as vehicle
assembly plants in Ontario prepare for a
once-in-a-century shift.
The new mandate for battery-powered
delivery vans at General
Motors' CAMI Assembly in
Ingersoll, Ont. - to replace
the current Chevrolet Equinox
crossover - as well as electrified
products promised to the
Ford and Stellantis assembly
sites in Oakville and Windsor,
respectively, will help futureproof
the country's auto sector,
experts say. But they will also
force suppliers to adjust to lighter
volumes and new components
as EVs slowly gain steam.
" We're going to get the
early mandates, that's great, "
said Flavio Volpe, president
of the Automotive Parts
though several orders have been made
public. FedEx booked 500 BrightDrop
EV600s and U.S.-based fleet management
company Merchant's
Fleet ordered 12,600.
Telecom company Verizon
has ordered an undisclosed
number of the
smaller EV410, which will
also be built at CAMI, and
Walmart has signed on
for a mix of 5,000 EV600s
and EV410s.
Brendan Sweeney,
managing director of the
Trillium Network for Advanced
Manufacturing in London, Ont.,
said initial BrightDrop production
at CAMI is likely to be considerably
lower than the number
of SUVs the plant has built
in recent years. CAMI produced
roughly 180,000 vehicles,
according to the Automotive
News Research & Data Center in
Detroit.
Volpe: A head
start in EV
transition is
worth lower
initial volumes.
FILE PHOTO
Manufacturers' Association (APMA). But
" with early mandates comes lower initial
volumes. "
At first, suppliers accustomed to delivering
300,000 parts a year for an internal-combustion-engine
(ICE) vehicle
might be getting orders for 60,000 or
100,000 EV parts, Volpe said.
At CAMI, GM has not released expected
production numbers for the new
BrightDrop electric delivery vans,
In terms of passenger vehicles,
lower initial volumes are
likely to be temporary, with buyers
pivoting toward EVs and
automakers ramping up production,
Volpe said. Getting in on
the electric transition early will
also give the Canadian industry
vital staying power.
" You've got to find the right mix. You
can't just hold onto the volumes on internal
combustion right now and then be
frozen out in the 2030s. "
COMBUSTION CONUNDRUM
Some suppliers are likely to face this
problem, said Laurie Harbour, CEO of
Harbour Results Inc., a Michigan-based
consulting firm specializing in modernizing
manufacturing operations. Harbour
pointed to any companies with outsized
exposure to ICE powertrains as at risk,
mainly because EVs keep their wheels
turning with different and far
fewer parts than their ICE counterparts.
Suppliers
of suspension and
braking system components will
also be affected, Harbour said.
And in tandem with the rise of
EVs, new technologies are disrupting
other long-standing characteristics
of vehicles. One example,
she said, are touch screen
displays that replaced dozens
of instrument-panel buttons in
Tesla vehicles.
" That eliminates a tremendous
amount of molds and a tremendous
amount of hard plastic
parts that go into that instrument
panel, " she said.
Suppliers accustomed
to delivering 300,000
parts a year for an internalcombustion-engine
vehicle
might receive orders for 60,000
or 100,000 EV parts, said APMA
President Flavio Volpe.
PHOTO: ISTOCK
You've got to find the right mix.
You can't just hold onto the
volumes on internal combustion
right now and then be frozen
out in the 2030s.
FLAVIO VOLPE
Automotive Parts
Manufacturers' Association
" It's a challenge, but it's possible. "
Harbour pointed to a " swim lanes "
approach for plant floors that creates fast
lanes for high-volume products and slow
lanes for low-volume products, allowing
for frequent changeovers.
" You're essentially eliminating the
noise out of the fast lane and putting all
the noise in the slow lane, " she said.
PARTING WITH PARTS
The move to EVs is certain to wallop
some parts suppliers, as ubiquitous components
such as fuel tanks, mufflers and
oil pans head for obsolescence. But it will
also create opportunities for makers of
converters, inverters, batteries and other
key EV parts.
Trillium's Sweeney expects to see the
same cast of characters take the lead
post-ICE, noting that the big industry
players are already transitioning to supplying
parts for EVs.
Harbour:
Beyond
GM has not released expected production numbers at its CAMI assembly plant for
the new BrightDrop electric delivery vans, though several orders have been made
public. SUPPLIED PHOTO
With EVs and other new vehicle
technologies at the " inflection
point, " Harbour said, suppliers
will need to balance the longterm
prospects of EVs with the
current demand for ICE vehicle parts. To
do this, she advocates suppliers get comfortable
running at both high and low
volumes.
powertrains,
EVs use touch
screens,
eliminating
traditional
gauge clusters
and the molds
that make them.
FILE PHOTO
" I don't want to discount startups and
new ideas and all this great
stuff, " he said, " but how much
will they really be trusted to be
putting parts in Toyotas and
Fords and Volkswagens? "
The APMA's Volpe agreed,
adding that a few opportunities
may " slip away " from the
traditional auto-supply base.
But he has little doubt that
big Canadian players such as
Linamar, Magna and Martinrea
are prepared to transition.
Harbour, on the other hand,
sees the possibility of new suppliers
emerging by getting in
early with low-volume contracts.
" If
somebody can get themselves
in the ground ... like
direct to a Lucid or direct to a
Rivian, and they're a small company,
as that volume grows,
then they grow, " she said.
The situation, she said, has the potential
to " change the face " of the supplier
community. - ANC
Automotive News Canada - January 2022

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