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Cox Automotive Forecast: New-Vehicle Sales Stall In September

Cox Automotive Forecast: New-Vehicle Sales Stall in September

Automobile sales in September are forecast to slow for the fifth straight month, as tight inventory, high prices take a toll on the industry.


September U.S. auto sales are forecast to be significantly hampered by an ongoing lack of new-vehicle inventory. According to a forecast released by Cox Automotive, the pace of auto sales, or seasonally adjusted annual rate (SAAR), is expected to finish near 12.1 million, the slowest pace since May 2020, when much of the country was closed during the first wave of the COVID-19 pandemic. The September 2021 sales pace will be down from August’s 13.1 million pace and down from the September 2020 pace of 16.3 million.

Cox Automotive Inc. makes buying, selling, owning and using vehicles easier for everyone. The global company’s more than 27,000 team members and are passionate about helping millions of car shoppers, 40,000 auto dealer clients across five continents and many others throughout the automotive industry thrive for generations to come. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately-owned, Atlanta-based company with annual revenues of nearly $20 billion.

Sales volume is forecast by Cox Automotive to come in near a notably low 1.0 million units. The low volume expectations for September 2021 put the month on course to be among the worst in the past decade. Sales volume is expected to be down nearly 26% from last September and down 8.5% from last month. The sales pace in the U.S. market has fallen every month since reaching a peak of 18.3 million in April.

According to Cox Automotive Senior Economist Charlie Chesbrough: “After a strong spring selling season, the supply situation has worsened precipitously and is dragging sales down with it. The monthly declines have been large – the sales pace has declined by more than a million units in each of the past five months. Available supply on dealer lots is now 58% lower than last September, down nearly 1.4 million units.”

The new-vehicle supply shortage is impacting the market in many ways. Manufacturers have cut back significantly on incentives, and transaction prices have risen as a result. In addition, the lack of new-vehicle inventory is steering many dealers and consumers into the used-vehicle market, resulting in higher prices for both wholesale and retail used vehicles.

Q3 2021: The Auto Industry Finds the Bottom

Cox Automotive will officially revise its full-year forecast, with new projections scheduled to be released on September 30.

The underlying economic conditions in the U.S. are currently healthy enough to support higher new-vehicle sales levels. The demand is there. Inventory levels, however, are the unique problem facing the automotive market right now, with disruptions to the global supply chain challenging all automakers, severely impacting available inventory, and pushing many would-be buyers out of the market. In recent research by Cox Automotive’s Kelley Blue Book team, nearly half of would-be buyers indicated in August that they will likely step back from the market, many for three months or more.

Inventory conditions, however, are anticipated to improve in the coming months. “The expectation is that OEM supply issues will improve such that Q4 should have better selling SAARs than the September rate, but that doesn’t mean good selling rates,” said Chesbrough. “Vehicles are getting produced, and some OEMs have improved their supply situation. In recent months, OEMs seem to be managing the situation better now that they’ve had time to adjust. For example, automakers are improving their ability to redirect existing chips to the most important vehicles in their portfolios. This strategy should support better sales in the fourth quarter compared to the third quarter.”

September 2021 Sales Forecast Highlights

  • New light-vehicle sales are forecast to fall to 1.0 million units, or down 357,000 units, nearly 26% from last year. Compared to last month, sales are expected to fall 92,000 or nearly 8%.
  • The SAAR in September 2021 is estimated to be 12.1 million, down from last September’s early COVID recovery pace of 16.3 million and down from August’s 13.1 million supply-constrained level.
  • No segment saw a sales increase in September with the Mid-Size Cars and Compact SUV/Crossover segments seeing the largest year-over-year decreases at -41.0% and -33.7%, respectively.

Cox Automotive Q3 U.S. Auto Sales Forecast Call

Chief Economist Jonathan Smoke and the Industry Insights team will share their take on the overall industry performance on Thursday, September 30, at 10 a.m. EDT. In addition to the economic factors influencing the market, the Industry Insights team will cover the industry’s hottest topics, including inventory, vehicle prices, and valuations. The revised Cox Automotive full-year forecast will be explained, including insights into the outlook for the remainder of the year. 

Register to attend.

* All percentages are based on raw volume, not daily selling rate.

SOURCE Cox Automotive Press Release. 

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Suez Canal Blockage Highlights Supply Chain Vulnerabilities

Suez Canal Blockage Highlights Supply Chain Vulnerabilities

In the latest supply chain crisis, a 400-meter-long mega-container vessel has wedged itself diagonally across the banks of Suez Canal since Tuesday, 23 March and has caused a blockage along this narrow channel.

The Suez Canal is the fastest shipping route from Asia to Europe and about 13 percent of world trade passes through the canal, according to Allianz, an investment firm. More than 50 ships pass through the canal every day, carrying 1.2 billion tons of cargo, including goods from crude oil to cattle. Hundreds of vessels remain trapped in the canal and some have opted for an alternative, much longer route around the Cape of Good Hope—the southern tip of the African Continent.

The blockage is holding up an estimated $9.6 billion worth of cargo each day, according to Lloyd’s List and causing a strain on global supply chains. Singapore’s Transport Minister has commented that the blockage could temporarily disrupt supplies to the region and drawdown on existing inventories will be necessary. Europe’s manufacturing industry including the auto sector will be one of the hardest hits as they operate in “just-in-time” supply chains where components are sourced from Asia and not stockpiled.

The incident has also emphasised vulnerabilities of our supply chain and the need for visibility in the entire supply chain to ensure transparency and agility in the event of an unexpected disruption.

*Update: Efforts to dislodge the giant vessel and restore traffic were finally successful a week after the incident and a backlog of 422 ships have the be cleared.

 

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EMO MILANO 2021: Meet “The Magic World Of Metalworking” In October 2021

EMO MILANO 2021: Meet “The Magic World Of Metalworking” In October 2021

EMO MILANO 2021, the leading world exhibition for metalworking industry, will take place at fieramilano Rho from 4 to 9 October, when the recovery of investment should already have started. The event is promoted by CECIMO, the European Association of Machine Tool Industries, and organised by the operational structures of UCIMU-SISTEMI PER PRODURRE, the Italian machine tools, robots and automation systems manufacturers’ association.

Metal forming and metal cutting machine tools, production systems, enabling technologies, robots and automation, solutions for interconnected and digital factories and additive manufacturing will be among the products and solutions spotlighted at EMO MILANO 2021. The large and varied product offering on show, the clear link between production technologies and IoT systems will be of great appeal to the operators of the world manufacturing industry, representing all major user sectors: machine tools, automotive, aeronautics, aerospace, railway industry, metallurgic sector and materials.

With these peculiarities, once again EMO MILANO will be able to attract qualified visitors according to its tradition confirming to be the World Exhibition for decision makers of purchases in production technology as 81 percent of total visitors is a decision maker (56 percent takes part in the purchasing decision; 25 percent decides autonomously).

Luigi Galdabini, General Commissioner of EMO MILANO 2021, stated: “The expectations of the sector operators are very high, as a testimony to the firm intention of the manufacturing world to return to normality. Indeed, a large number of applications to exhibit have already been received at the Secretariat Office and their collection goes on swiftly. However, we expect that it will further intensify in the next weeks, thanks to the more and more widespread distribution of vaccines to the global population”.

Availability of vaccines, forecasts of demand growth in all the main areas of the world and important incentive measures for investment in new production technologies in Italy: these are all elements that make up a really favourable context for EMO MILANO 2021.

Indeed, according to the forecasts processed by Oxford Economics, after a 23.4 percent fall registered in 2020, the year 2021 should bring about a recovery in machine tool consumption worldwide, expected to grow by +18.4 percent to 61 billion euro, (Asia 33 billion euro, +15.6 percent; Europe 17 billion euro, +23.5 percent; Americas 12 billion euro, +19.7 percent). If we observe the single countries, all of them should experience a demand recovery, likely to continue also in 2022 and in 2023. Focusing on Europe, in 2021 both Italy (3.1 billion euro, + 38.2 percent) and Germany (5.7 billion euro, +20.9 percent) should again see a plus sign with regard to investment in production technologies. The growth trend is confirmed for both countries also in the two-year period 2022-2023.

Moreover, the Italian Government set up special fiscal incentives, which consist of tax credit up to 50 percent, for Italian companies investing in new machine tools, robots, automation systems, 4.0 and digital technologies in 2021 and 2022.

Highlights of the event includes a START UP AREA which will highlight the role of start-ups for a sector whose strong point is innovation. And a SPEAKER CORNER, which will combine the exhibition with a thematic, in-depth cultural analysis, developed through a programme of conferences on specific topics and through side events that will host discussions with opinion leaders and presentations of technologies related to the sector.

 

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SLM Solutions Signs MoU For The Purchase Of Five NXG XII 600 With Major European OEM

SLM Solutions Signs MoU For The Purchase Of Five NXG XII 600 With Major European OEM

A major European OEM has signed an (Memorandum of Understanding) MoU to purchase five NXG XII 600 machines, with the first machine delivery in 2022. The agreement also facilitates the reservation and allocation of production-slots.

In November 2020, SLM Solutions unveiled the NXG XII 600 boasting 12 lasers, each with 1 kW power and a build envelope of 600x600x600mm. Its arrival marks a breakthrough in the additive manufacturing (AM) sector and paves the way for industrial serial production. Combined with innovative technical features, maximum productivity and reliability, it proves SLM Solutions’ technological leadership in the AM manufacturing industry. The customer will be one of the first global companies to take advantage of its benefits and intends to implement it for serial production.

Sam O’Leary, CEO of SLM Solutions explains: “When we launched the NXG XII 600, we knew it would disrupt the industry and spark a new era for manufacturing. Therefore, this MoU just two months after the launch is an exciting milestone for the company.  It validates our vision that the OEMs can implement innovative additive manufacturing technology for serial production into their business models.” He then went on to say that: “The NXG XII 600 accelerates the future of metal additive manufacturing, and our engineers have further pushed the boundaries of what is possible.”

Additive Manufacturing can lead to numerous commercial and technical advantages allowing companies to strengthen their competitive positions. It requires knowledge in additive manufacturing, but above all, robust and productive machines. The SLM Solutions’ NXG XII 600 takes manufacturing to a new level and enables the production of complex, high-quality metal parts in only a few hours.

O’Leary further states: “This MoU underlines that not only are we prepared to step forward to the industrialisation of metal additive manufacturing, but the marketplace is ready as well.”

The final binding agreement will be signed by Q2 2021.

Additionally, a further beta machine contract has been concluded with another customer. This machine will be delivered in Q2 2021.

Click here to learn more about the NXG XII 600 and its applications from SLM’s customers! 

 

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Marposs Takes Part In Battery Alliance

Marposs Takes Part In Battery Alliance

During the ongoing clean energy transition, Marposs is working with a diversity of key industrial actors, research technology centers and universities to face the main objective of the European Commission: build a competitive, sustainable and innovative battery ecosystem in Europe, covering the entire value chain.

This is the main objective behind the European Battery Alliance (EBA), an industry-led initiative, which the Commission launched back in October 2017, to support the scaling up of innovative solutions and manufacturing capacity in Europe. 

The demand for batteries is expected to grow very rapidly in the coming years, making this market an increasingly strategic one at global level. This trend is further reinforced by the new and comprehensive legislative and governance framework for the Energy Union, successfully adopted under the European Commission to accelerate the transition to a sustainable, secure and competitive EU economy.

The shared vision for Marposs and European Battery Alliance is to realise the batteries of the future, providing European manufacturers with disruptive technologies and a competitive edge across the full production process. EBA will pursue high-performance, high-quality, reliable and sustainable batteries production system, by a cross-disciplinary research approach, leveraging advances in artificial intelligence, robotics, sensors and smart systems.

The technology developed will have an invaluable impact on the ongoing transition towards a carbon-neutral and circular economy.

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The AMable Project Promotes Flexible AM Solutions To Fight The Coronavirus

The AMable Project Promotes Flexible AM Solutions To Fight The Coronavirus

The coronavirus is currently paralysing public and private life and in many places, there is a lack of medical equipment and viable solutions to protect society against the spread of the virus. Together with institutions from all over Europe, the Fraunhofer Institute for Laser Technology ILT is supporting companies in the EU project AMable in implementing Additive Manufacturing ideas that will help overcome bottlenecks in this fight.

Within the framework of the EU’s I4MS initiative (ICT Innovation for Manufacturing SMEs), partners of AMable have promoted 3D printing with metal and plastic for small and medium-sized enterprises (SMEs). Now, they are looking at measures to quickly and reliably come up with solutions for the vital work of hospitals, medical practices and nursing staff.

Call for ideas: What ideas can be implemented with 3D printing?

AMable offers universal support in all phases of Additive Manufacturing. The platform’s partners provide the necessary expertise for implementing reliable 3D printing processes with materials of all kinds – from plastic or metal to ceramics.

However, currently there is a greater demand for small extruder 3D printers on site so that products can be produced locally and on demand, according to Ulrich Thombansen, project coordinator and scientist at Fraunhofer ILT.

Accordingly, the message is “Name ideas for 3D printing that can be used, for example, to do medical technology work better and easier than before. What we want to understand is where Additive Manufacturing can make a contribution to reduce the impact of the pandemic.”

Call for solutions: Public suggestions for topics through all channels of the media

What matters to the AMable partners is the complete transparency of their work: They want to present the proposed topics directly to the AM community via all common social media channels, associations and the press as a “call for solutions” in order to find suitable partners that AMable actively supports with public funding and experts.

Diving masks become simple ventilators

The chances are good because well-known European institutes are participating in the AMable platform, and Thombansen is coordinating their work as project manager. As an interesting idea, he describes, for example, a project at the University of Marburg, where a team has modified existing CPAP devices for the treatment of sleep apnea for use with COVID-19 patients. Similar ideas are being pursued by some projects in the community, where a few 3D printed parts make it possible to even use diving masks as respiratory aids.

“We want to bring people with similar ideas together with experts from the AMable network so that they can implement their 3D printing idea both quickly and reliably. AMable acts as a turbocharger from idea to implementation,” said Thombansen.

 

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Auto Sector Faces Biggest Existential Crisis Since 2007-09

Auto Sector Faces Biggest Existential Crisis Since 2007-09

The automotive sector is facing its biggest existential crisis since the 2007-2009 financial crisis with 97 percent of light vehicle (LV) manufacturing plants in Europe and North America temporarily shut down, says GlobalData.

READ: Shutdowns To Cost European Auto Industry GBP 29 Billion

Calum MacRae, Automotive Analyst at GlobalData, comments: “In Europe and North America, GlobalData’s latest estimates show that some 2.5 million LVs have been removed from production schedules at a cost of $77.7bn in lost potential revenue – if it is assumed the stoppages last at least up until the end of April.

“This time, the threats are not the one-dimensional threat to demand precipitated by the financial crisis. Supply chains are affected and workforces are affected. It is challenging to manufacture vehicles and components without endangering a workforce. Safe manufacture, if possible, can only be achieved at a reduced capacity.”

READ: Ford & Toyota—First Automakers To Suspend Production In Vietnam Due To Covid19

Efforts to suppress the spread of the coronavirus (COVID-19), with social lockdowns widely implemented affecting 20 percent of the global population, have decimated vehicle demand overnight.

MacRae added: “In response, 168 out of 173 LV manufacturing plants in Europe and North America have called a halt to operations for varying amounts of time during March and into April. Additionally, production stoppages are not limited to North America and Europe, the virus is roiling the industry from Detroit, to Dusseldorf to Durban.

READ: Coronavirus Hits Automotive And Aerospace Supply Chains

“What’s more, the shocks will ripple through the supply chain with supplier plants also being furloughed. It really is an unprecedented crisis, the in terms of its speed and scale. The auto sector faces its biggest existential crisis since the financial crash and subsequent recession of 2007-09.”

 

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Shutdowns To Cost European Auto Industry GBP 29 Billion

Shutdowns To Cost European Auto Industry GBP 29 Billion

According to GlobalData’s European light vehicle production forecast, a six-week shutdown of auto factories from beginning of March to 26th April will amount to a GBP 29.3 billion loss in revenues, taking the average value of a new car at GBP 22,000. The industry will see the removal of 1.3 million light vehicles from production—equivalent to the number of vehicles four average-sized plants would manufacture in a year.

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This comes after a period of sweeping announcements by European automakers that they are halting production at European plants for several weeks—95 out of 103 light vehicle production plants in Europe have announced production stoppages to some degree.

READ: Coronavirus Hits Automotive And Aerospace Supply Chains

“Once again, the automotive sector, as one of the most powerful economic multipliers, is at the forefront of the economic crisis. Hardly an hour has gone by in the past few days without an announcement by an automaker that it was stopping production,” commented Calum MacRae, Automotive Analyst at GlobalData.

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“Our analysis shows how the short-term costs to the industry mount up over a six-week period. This crisis is a negative sum game across all industrial and consumer sectors and walks of life and the numbers could be set to become a whole lot worse before they become any better,” he added.

 

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Trumpf Records Most Successful Year In The Company’s History

Trumpf Records Most Successful Year In The Company’s History

GERMANY: The Trumpf Group was able to significantly increase sales, orders received, and profits in the 2017/18 fiscal year that ended in June 30, 2018. Sales rose by 14.6 percent to 3.57 billion euros from 3.11 billion euros in fiscal year 2016/17. This is the highest figure in company history since its foundation in 1923. Orders received increased 12.5 percent to 3.8 billion euros from 3.4 billion euros in 2016/17. Operating income before taxes rose by 52.3 percent to 514 million euros from 337 euros in fiscal year 2016/17. The net operating margin amounted to 14.4 percent compared to 10.8 percent one year earlier.

Driven by an ongoing and strong global economy, Trumpf was able to significantly exceed its projections in some areas. The company’s largest business division, Machine Tools, increased its sales by 11.3 percent. The Laser Technology division achieved sales growth of 21.5 percent. EUV lithography for the exposure of microchips performed particularly well, increasing by 57.3 percent over the previous year to 250 million euros. Trumpf’s plans for the current 2018/19 fiscal year envisages further noticeable growth in EUV lithography. Even today, sales in this strategically important business segment exceed those of most of the company’s foreign sales markets.

Once again, Germany was the largest single market for Trumpf, with sales up by 15.6 percent to 719 million euros, followed by China with sales that reached 457 million euros. This was 13 percent higher compared to the previous year. Sales from the United States was also up by 5.4 percent compared to the previous year and reached 444 million euros, making the country the third highest earning market for Trumpf. Year-on-year sales in Italy grew by 31.8 percent to 173 million euros, making the country the fourth strongest single market for the first time. In addition to these markets, Trumpf also intends to intensify its business activities in countries such as Mexico and Canada as well as in the Asian countries such as Thailand, Malaysia, Indonesia, Singapore, and Vietnam in an effort to achieve an average annual growth of 10 percent.

In the current fiscal year, despite the general slowdown of the global economy, Trumpf expects to generate business with a similar level of profitability.

The group wide workforce grew by 12.9 percent in the reporting period to 13,420 employees as of the June 30, 2018 balance sheet date and has since exceeded the 13,500 mark. In Germany, there were 6,778 employees, around 3,900 of whom were employed at the company headquarters in Ditzingen. This equates to an increase of 12.5 percent. Outside of Germany, the number of employees rose by 13.3 percent to 6,642. More than half of Trumpf’s employees were stationed at the company’s German sites in Baden-Württemberg, Saxony, North Rhine-Westphalia, and Berlin. During the year under review, 450 young people completed a training course at Trumpf or a co-op work-study program. The training quota in the group stood at 3.5 percent.

In the past fiscal year, Trumpf invested in emerging technologies such as EUV lithography or metal 3D printing (additive manufacturing), as well as driving forward the AXOOM digital business platform. Expenditure on research and development rose by 5.9 percent to 337 million euros. The company’s R&D ratio in relation to sales amounted to 9.5 percent. The number of employees worldwide working on new products for TRUMPF increased by 13.2 percent to 2,087.

The company’s capital expenditure totaled 216 million euros in the 2017/18 reporting period. Real estate and construction projects accounted for 43 percent of the total sum invested, technical plant and machinery for 18 percent, and office and business equipment for 33 percent. More than half of this expenditure concerned construction projects in Germany, with around two thirds of this sum going toward the new headquarters building in Ditzingen, and the remaining one third to the expansion of the German manufacturing sites in Teningen and Schramberg.

Investments in other European countries accounted for 13 percent of the Group’s total capital expenditure, while 15 percent concerned the Americas. The smart factory demonstration center in Chicago is an outstanding example, representing an investment of 26 million euros. Another major investment project was the creation of the Trumpf Group’s largest-ever production site, operated by the Chinese joint venture JFY. The total cost of this investment was 14 million euros.

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