Autonomy, Workforce Development Drive "Forward Momentum” Theme at Southern Automotive Conference
Monday, October 15th, 2018
Autonomous vehicle (AV) technology and industry workforce development drove the “Forward Momentum” theme that spotlighted the 11th Annual Southern Automotive Conference (SAC) last week at the Cobb Galleria Center.
Rick Walker, President, Georgia Automotive Manufacturers Association (GAMA), welcomed an estimated 1,300 attendees to the event—the first to be held in Georgia— calling it “all about connections,” and suggested they could make it their best experience ever in trade shows. The conference agenda featured multiple networking opportunities to learn, share and collaborate on the latest and future trends of automotive technology, as well as on the best solutions for workforce development: white papers, breakout sessions, exhibitor booths, and spotlight theatre videos.
Walker also noted that the Georgia automotive industry employs 26,500 workers and produces $3.3 billion in exports.
INDUSTRY 4.0—THE FUTURE OF DATA IS HERE
When introducing Keynote Speaker, Ken Koch of KPMG, Rodger Jenkins of Group Mobile prefaced the subject matter of data playing a key role in the state of the industry with this factoid: “Just recently, General Electric released a study that over the next 15 years, they are expecting at least $60 trillion dollars to be spent in the IOT (Internet of Things) world.” As a branch of IOT, the advent of autonomous vehicles presents challenges and opportunities for industry companies to collect, move, secure and make data work for strategic outcomes.
Koch stated that while driverless cars are inevitable, adoption of this disruptive mode of transport will not be immediate and will not blanket the entire country at once. Rather, he used the term, “Islands of Autonomy” to elucidate how the trend will evolve, metro market by metro market, and each will have a unique approach. For example, Waymo is currently testing in the Phoenix area according to demographic behavior, such as commute patterns, number of drivers, safety patterns, trip missions, etc. Not only are the self-driving cars in actual daily use, 5 billion miles of simulation testing complement and corroborate the 9 million miles of actual user data that help ensure safety, and, as a result, learning occurs faster. Next stop: Atlanta within the year.
While AVs may herald lower cost per mile, more personal miles traveled, new revenue potential, and even the possibility of fewer accidents, the overall disruption will create unintended consequences and secondary effects, as well. For instance, Koch pointed out the impact at the dealer level, such as with Tesla; the need for less repair parts; and the impact on the parking and insurance industries. A KPMG white paper predicts that sales of sedan models of cars will decline by 60% by 2030 due to ride-sharing options and consumer requirements.
TIER 1 PERSPECTIVE
Linda Hasenfratz, CEO of Linamar Corporation, a Canadian manufacturer of components and systems for the automotive and commercial vehicle industry, with four facilities in North Carolina, addressed many of these issues from her company’s perspective as a Tier 1 operation. As free trade advocate who participated at the recent United States-Mexico-Canada Agreement (USMCA), Hasenfratz said, “Times of extreme uncertainty lead to opportunity. The pace of change and data availability is enormous: 1.7 megabytes of new information is created every second, more during 2015-2017 was created than in all of previous history."
In order to succeed in these disruptive times, Hasenfratz suggests companies have flexible, fluid workforces, stay focused, and keep innovating. “Think long term, think big picture and think culture, that is, who we are.” She predicted that the internal combustion engine, at least for the foreseeable future, remains, but certainly alternate fuels such as electric, and hybrid engines will be the areas of growth, so it is best to “build a strong portfolio of products” for each of these categories.
WORKFORCE DEVELOPMENT: RESTORING THE DIGNITY OF WORK
The automotive industry faces “a significant challenge of not having enough skilled workers” and by “2019, it will lose 47% of the workforce,” said Daniel Groves, CEO of Construction Industry Resources, LLC.
In the same breakout session, David Eyes, Sales Director for Automotive Solutions DI Central, used the example of college coaches and other sports organizations scouting and grooming youngsters in order to offer them professional guidance for future development. He made the distinction between the aspirations of a parent wishing their child to become a star, versus the way kids look to outside experts for more practical inspiration in their areas of interest. Eyes added that engineers, purchasing agents, accountants and others can and should relate to young people in their early teens in order to inspire them to enter the workforce someday in their respective professional fields.
Groves noted that, although the economy is in its 112th consecutive month of recovery, the ageing workforce will suffer attrition at two, five, ten and fifteen year intervals. His rationale is that it takes time to recruit, train, and place into the marketplace new workers, and it will be a real challenge. While global migration might alleviate the short fall for the near future, by 2030 international demographics will no longer be favorable.
“We need to return to first principles,” stated Groves, and, quoting John D. Rockefeller, the number one priority is to “restore the dignity of work.” As a result of his three-year study, Groves then listed seven policy recommendations for leadership to follow:
Revitalize work-based learning programs with a new approach relating to “what do I enjoy doing.” He calls it “education through occupation.”
The workforce must be a priority for owners to train and maintain skills.
Establish career opportunity awareness: for every person with a Masters degree, the industry needs two with an undergraduate degree, but seven with certifications from Career Technical Education (CTE) schools. Currently 45% of high school graduates go on to a college education.
The educational system needs to redefine its quality measurements.
Increase minority and female participation in the workforce, and even consider rehabilitated persons with police records.
Establish stakeholder collaboration. The biggest challenge is leadership and educators need to listen and learn about these policies. Government has to change educational funding streams appropriately.
The level of CTE spending has decreased while college funding has doubled over the past eighteen years, so we need to rebalance funding.
OTHER AGENDA ITEMS
The SAC agenda also included talks and presentations on legal issues, such as changes in OSHA penalties (some leeway on repeat occurrences if preventive efforts had been taken, but higher fine amounts and more frequent inspections), as well as the impact of a ruling on Automotive Class Action Suits.
In addition to his welcoming statement in the SAC program, Georgia Governor Nathan Deal presented a separate address in person to conference attendees on Friday.
The Southern Automotive Manufacturers Alliance (SAMA) board established a Hall of Fame and inducted Donald Stoegbauer (“Stogie”), renowned for his contributions to the industry and his leadership in forming SAMA, as it first member to be enshrined.
The Annual Stars of Southern Manufacturing Award winners were as follow:
From Alabama: Natasha Hall – Lear Corporation
From Georgia: Kimberly Sears, Kia Motors
From Tennessee: Wendell Williams, Nissan Power Train
From Mississippi: Kanesha Jackson, Toyota
ABOUT THE SOUTHERN AUTOMOTIVE CONFERENCE
The Southern Automotive Conference is presented jointly each year by the automotive manufacturing associations of Alabama (AAMA), Georgia (GAMA), Mississippi (MAMA) and Tennessee (TAMA). The Kentucky Automotive Industry Association (KAIA), South Carolina Automotive Council (SCAC), and Southern Automotive Women's Forum (SAWF) are affiliate members of SAC.