1. Preparing the Workforce for the Automotive Technology of 2025 OCC/DMA/WIN Fall Conference November 8, 2013 Bernard Swiecki Center for Automotive Research (CAR)

2. Industry Collaboration & Partnerships CAR collaborative working groups: Automotive Communities Partnership (ACP) Connected Vehicle Working Group United Tooling Coalition (UTC) Program for Automotive Labor and Education (PALE) Electric Vehicle Working Group Advanced Automotive Information Technology Solutions Consortia Coalition for Automotive Light-weighting Materials (CALM) The Center for Automotive Research brings together stakeholders for thought leadership and industry education.

3. CAR’s flagship event, August 5-8 Now in its 48 th year – a “can’t miss” event More than 900 attendees Sessions on manufacturing, materials, connected vehicles, policy, sales forecasting, purchasing, strategy, & capital investment More information at www.cargroup.orgwww.cargroup.org

4. Name a product … ? Which consists of nearly 30,000 parts, Can be assembled at the rate of 1 per minute, 16 hours a day, 200 days a year, Runs for several years, most of the time without a single manufacturing defect? Is from the largest manufacturing sector in the U.S. economy. This accomplishment by the auto industry to execute mass production has become the norm.

5. U.S. Light Vehicle Sales Percent Change YTD Through October: 2013 vs. 2012 Source: Automotive News; CAR Research

6. U.S. Market Share: YTD October 2013 Source: Automotive News; CAR Research

7. U.S. Light Vehicle Monthly Sales and SAAR October 2011 – October 2013 Source: Automotive News; CAR Research

8. Big 7 Monthly U.S. Market Share 1999 – 2013 YTD (October) Source: Automotive News; CAR Research

9. Motor Vehicle & Parts Manufacturing Employment 1999 – July 2013 50% change 64% change 53% change 47% change Source: BLS, U.S. DOL

10. Per Vehicle Profits*, North America 2006—2013/1stH *EBIT or automotive operating income per vehicle sold. Global average for Chrysler figure. Honda excludes motorcycle, finance, and power products.

11. Quarterly GDP Growth Rate 07/1Q – 13/2Q Source: Bureau of Economic Analysis; Federal Open Market Committee

12. Auto Sales and Economic Growth are Disconnected U.S. GDP Growth Rate and Vehicle Sales Growth Rate 1952 – Q2 2013 Source: Bureau of Economic Analysis

13. They are Getting Old... U.S. Light Vehicle Age and Scrappage Rate Source: R.L. Polk

14. Unemployment Rate January 2008 – July 2013 Source: Bureau of Labor Statistics

15. U.S. Light Vehicle CAR Sales Forecast: 2007-2016 Source: CAR Research, Oct. 2012 10.4% 11.6% 13.3% 8.3%

16. U.S. Vehicle Production & Automotive Employment Forecasts 2013-2016 Source: Automotive News; CAR Research; BLS, July 2013 Employment not growing much: Third party workers More imported parts and components More overtime and temporary workers High productivity rate

17. Manufacturing Efficiency Taiichi Ohno: Toyota Production System Global Supply Chains Flexible Manufacturing & Industrial Robotics Global Platforms Digital Engineering & Manufacturing

18. Fuel Economy Regulation Projections Source: EPA and NHTSA Grams CO2/mile CAFE mpg 54.5

19. Fuel Economy & Safety The most likely dramatic changes for the automotive market through 2025 could well be a result of mandates by the federal government to improve the fuel economy performance and vehicle safety

20. North American Automotive Manufacturing and R&D Clusters, 2011 © Center for Automotive Research, April 2013 Auto: Over 1M U.S. jobs (incl. spinoff) Over $12B/year private R&D in Michigan

21. New technologies … what’s coming next ? Automotive Innovation Powertrain Materials (Lightweighting and Crashworthiness) Electronics Safety Road use Convenience Many supportive ones

22. High Impact - Strategic Incremental – Low Risk 22

23. Average Material Content of North American Light Vehicles Image: Porsche Data source: Wards

24. Average Material Content of North American Light Vehicles Image: Porsche Data source: Wards

25. Joining Complexity Increasing Joining Laser Welding Fasteners Adhesives Resistance Spot Welding

26. New body shop for aluminum frame Carbon fiber hood and roof and interior Carbon-nano composite underbody panels Magnesium frame seat SMC fenders, doors and rear quarter panels & hatch – Extrusions, castings and sheet (castings 2mm – 11mm) – Hydro formed tubes Magnesium structural chassis components Joining: adhesive, laser welding, fasteners, spot welding 2014 Corvette Stingray: A Future Direction for Materials Photo Source: General Motors

27. Key Material Trends (Next 10 years) Increased use of ultra high strength steel for structural components around the “safety cage” to prevent intrusion Aluminum use for chassis and exterior panels is increasing Fiber reinforced plastics (glass and carbon) for structural components are still several years away from high volume production Joining complexity: more laser welding, fasteners and adhesives Structural Adhesive

28. Driver Attention & Connected Vehicles Top 3 features consumers want: 1.Wireless Communications (bundle of many features) 2.Navigation 3.Automatic Crash Notification connectivity is increasing glance sequences

29. Connected Vehicles Defined Connected vehicles use any of a number of different wireless communication technologies to communicate with: – Each other – Roadside infrastructure – The “Cloud” Goals for connected vehicles are to enhance – Vehicle and roadway safety – Mobility – Environment (e.g., reduced fuel consumption)

30. Implications for Investment of Convergence and Self-Driving Vehicles Crash elimination: Crash-free driving and improved vehicle safety could change the concept of a vehicle as we know it Travel time dependability: Convergence can substantially reduce uncertainty in travel times via real-time, predictive assessment of travel times on all routes Productivity improvements: Convergence will allow travelers to make use of travel time productively Reduced need for new infrastructure: Self-driving can reduce the need for building new infrastructure and reduce maintenance costs Improved energy efficiency: Reduced energy consumption in at least three ways: more efficient driving; lighter, more fuel-efficient vehicles; and efficient infrastructure New models for vehicle ownership: Self- driving vehicles could lead to a major redefinition of vehicle ownership and expand opportunities for vehicle sharing New business models and scenarios: Convergence of technologies may realign industries such that ecosystem participants need to compete and collaborate at the same time Data challenges: Issues related to data security, privacy, and data analytics and aggregation could crop up due to abundance of data in vehicles

31. Industry Challenge  Severe shortage of technical skills  Chicken-and-egg challenge with many technologies  electrification/alternative fuels  Materials supply chain  Connectivity – retrofitting, infrastructure/automobile  Predictive modeling: CAE  Powertrain control systems  Materials forming and crash performance  Structures  Fabrication (molding, hot forming, stamping AHSS/aluminum, …)  Joining (RSW, laser, adhesives, fasteners)  Greater industry collaboration  Standards (material, testing, …)

32. Center for Automotive Research Thank You