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The US auto industry is at risk of being left behind by its Chinese counterparts and start-up electric vehicle (EV) manufacturers, according to a blunt report from the 2020 Global Leadership Conference (GLC). The white paper, presented by Flaharty, highlights some striking statistics. As reported in Forbes, the Detroit Three automakers lost an alarming 6.6% points of global market share to Chinese automakers and EV startups. This translates to approximately 5.6 million units of capacity and tens of thousands of jobs.
The report emphasizes that the legacy auto industry cannot compete with China unless it drops some outdated engineering priorities. For instance, Flaharty notes that older manufacturers are still designing structural beams inside instrument panels based on specifications developed for vehicles with piston engines. This is unnecessary and adds cost and weight to electric vehicles (EVs).
To move forward, the report suggests that US automakers should learn from younger US manufacturers like Tesla and Rivian, as well as China’s automotive industry practices. These include adopting a more iterative approach to product design and production, rather than waiting for perfection before launching a new vehicle.
Another key takeaway is the need for better lobbying efforts on Capitol Hill. The paper points out that the auto industry does not have sufficient political influence in Washington DC. Only three of the 16 or so automotive manufacturers operating in the US have their own Political Action Committee (PAC).
The industry leaders are urged to work with government officials, build relationships and educate them about the challenges faced by the sector.
In conclusion, the white paper stresses that new thinking and smart policies can revitalize the industry and accelerate its economic contribution.
Source: www.forbes.com
