| New faces — and new products — rise up the supply chain |
It’s the dawn of a new era for the automotive supply chain. Not only are the companies that populate it changing, but so are the products and the places.
This week we present the annual Automotive News Top Suppliers ranking, which orders parts makers by their global 2022 sales revenue to automakers. The list includes several new companies near the top this year, specifically major producers of batteries for electric vehicles.
The fast-growing Chinese EV battery giant CATL crashed this year’s Top 5, while companies such as Samsung SDI that have long had an automotive presence saw their position on the list rise now that automakers are buying more batteries.
This is all happening even though EVs still account for only a small, if quickly growing, portion of overall new-vehicle sales worldwide. So just imagine, as automakers roll out dozens of new EV models in the coming years and source even more batteries for them, how the suppliers we have traditionally thought of as the “world’s biggest” are likely to change.
Legacy suppliers aren’t going to have “the same voice that they had in the ICE world when they go into the BEV world,” we hear this week from Michael Robinet, executive director of automotive advisory services at S&P Global Mobility.
But traditional suppliers aren’t sitting idly by as the automotive world changes. Indeed, many of them are actively driving change in the industry.
This week, as part of our recurring Intelligence Report series, we shine a light on suppliers in all business segments and tell you that many of them are now investing significant resources in their North American manufacturing footprints, specifically to supply automakers with the various components they’ll need to build upcoming EV models.
The investments provide a glimpse into how the geographies of EV supply chains will differ from today’s. Suppliers are investing near massive EV assembly and battery plants, not just in their own backyards, but to support new projects such as Ford’s BlueOval City in Tennessee and Hyundai’s $5.54 billion “Metaplant” in Georgia.
It’s well-known that the auto industry is transforming.
But it’s still surprising to see how true that is for the supply base.
— John Irwin
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