CIE Automotive Sustainable growth through globalisation and innovation Kerman Osoro 25-4-12 1
INDEX 1.- CIE Automotive- company presentation 2.- Globalisation and relocation- when and why 3.- Added value analysis 4.- Innovation impact in different sectors 5.- How is the automotive sector in Europe? 6.- Impact of the electric vehicle in the car industry 7.- CIE s recipes for success
CIE AUTOMOTIVE COMPANY PRESENTATION
4 MAIN AUTOMOTIVE GROUPS IN SPAIN 4
CIE Automotive group structure 2011 Turnover- 1.839.7 M Number of employees- 14.335 Areas - Automotive components- CIE Automotive - Biodiesel- Bionor - Technological solutions and services- Dominion 5
AUTOMOTIVE DIVISION BUSINESS SPLIT BY TECHNOLOGY Technologies Countries Info 2011 ALUMINIUM SPAIN MEXICO - ROMANIA TURNOVER 165 Mill FORGING SPAIN BRAZIL LITHUANIA TURNOVER 185 Mill STAMPING TUBE FORMING MACHINING SPAIN CZECH REP - BRAZIL MEXICO CHINA - RUSSIA SPAIN CZECH REP FRANCE LITHUANIA BRAZIL MEXICO - RUSSIA TURNOVER 500 Mill TURNOVER 260 Mill PLASTICS SPAIN PORTUGAL MOROCCO - CZECH REP. BRAZIL MEXICO CHINA - RUSSIA TURNOVER 210 Mill CASTING BRAZIL TURNOVER 55 Mill ROOF SYSTEMS SPAIN FRANCE- ROMANIA CHINA TURNOVER 102 Mill
62 PLANTS SPREAD AROUND EUROPE, AMERICA, ASIA & AFRICA 7
CIE PRODUCTS- ENGINE ENGINE Crankshafts Forging Crankshaft caps Machining Common Rail Fuel Rail Oil Pump Aluminium Exhaust Air duct Tubes Metal Forming Oil Pump Machining Air tanks Plastic Valve Guides Machining Bracket Aluminium Oil Pan Aluminium, Metal Forming, Plastic Bracket Metal 8
CIE PRODUCTS- CHASSIS AND BODY CHASSIS & STEERING Body in White / Metal Forming Steering Housings Aluminium, Machining Column Bracket Aluminium EPS Main Housing Aluminium Rear Axle Metal Forming Hubs, Outer Rings & Spindles Forging & Machining Airbag Frame Metal Forming Brake Booster Metal forming Hydraulic Pump Housing Aluminium Seat Structure Metal Forming EPS Machining Suspension Arm Metal forming 9
CIE S PRODUCTS- TRANSMISSION TRANSMISSION & GEARBOX Axle Shaft Forging CVT & Hybrid Components Forging Turbine Hubs Machining Gear Shift Metal Forming CV- Joints & Propshaft CV-Joints & Propshaft Forging Pistons Aluminium Gear Housing Aluminium Differential Case Machining & assemblies Gearbox Housing Machining Mechanical Housing Aluminium Crowns Machining 10
CIE S PRODUCTS- INTERIOR AND EXTERIOR TRIM INTERIOR & EXTERIOR TRIM Front covers Plastic Arm Rest Plastic In Mould Decoration Plastic Central Console Plastic Trim Parts Plastic Glove Compartment Plastic Crossbeams Tube Forming Emblems Plastic Rear-view mirrors Door handles Plastic 11
CIE S PRODUCTS- ROOF SYSTEMS Shading Cargo Management Glazing 12
GROWTH BASED ON DIVERSIFICATION PRODUCTS TECHNOLOGIES CUSTOMERS REGIONS 13
GLOBALISATION AND RELOCATION STARTED WHEN.AND WHY??
FALL OF BERLIN S WALL defines a new era in the automotive sector 15
Strong move of components towards eastern european countries
MEXICO PROFITING ON CAR AND COMPONENTS PRODUCTION 17
Asia becomes the strongest growth area
Global car production countries
BRIC countries become as important as traditional car production sites 1997 2007 2015 52.3 Emerging Markets 17% North America, West Europe & Japan/Korea 83% 68.6 North America, West Europe & Japan/Korea 66% Emerging Markets 34% North America, West Europe & Japan/ Korea 54% 79.3 Emerging Markets 46%
Global production changes 2000-2011 WORLD WIDE PRODUCTION RANKING WORLWIDE PRODUCTION RANKING WORLWIDE PRODUCTION WORLWIDE PRODUCTION BY COUNTRIES 2000 RANKING BY COUNTRIES 2005 RANKING BY COUNTRIES 2011 RK Country 2000 RK Country 2005 RK Country 2011 1 United States 12.433.718 1 United States 11.571.252 1 Greater China 16.383.130 2 Japan 9.785.473 2 Japan 10.253.565 2 United States 8.388.848 3 Germany 4.880.889 3 Germany 5.189.250 3 Japan 7.655.532 4 France 3.273.698 4 Greater China 4.922.993 4 Germany 5.735.264 5 South Korea 3.038.826 5 South Korea 3.623.781 5 South Korea 4.495.660 6 Spain 2.941.015 6 France 3.456.195 6 India 3.494.868 7 Canada 2.907.305 7 Canada 2.621.562 7 Brazil 3.124.400 8 Mexico 1.871.005 8 Spain 2.620.682 8 Mexico 2.530.498 9 United Kingdom 1.795.937 9 Brazil 2.207.938 9 Spain 2.332.609 10 Italy 1.699.544 10 United Kingdom 1.783.880 10 France 2.170.144 14 Russia 993.636 12 India 1.280.004 12 Russia 1.790.459 15 India 740.334 13 Russia 1.255.949 RK REGION 2000 RK REGION 2005 RK REGION 2011 1 ASIA 19.403.039 1 ASIA 25.876.777 1 ASIA 35.592.956 2 EUROPE 19.233.473 2 EUROPE 19.945.522 2 EUROPE 19.748.515 3 NAFTA 17.212.028 3 NAFTA 15.791.447 3 NAFTA 13.022.968
Top car production sites 2011 Indonesia 22
POSITIVE APPROACHES MAY HIDE THREATS SALARIES, WORKING HOURS, QUALIFICATION, MOTIVATION, COMMITMENT, EFFECTIVENESS 23
Regional car production forecast South America C/E Europe China India Africa
BRICs expansion bring new potential hubs to export components overseas India component export forecast 2002-2016 25
CIE AUTOMOTIVE- SALES AND EBITDA EVOLUTION SALES EBITDA Millones de euros 1800 1600 1400 1200 1000 800 600 400 200 481 570 670 782 910 1.109 1.261 1.016 1.591 200 180 160 140 120 100 80 60 40 20 53 80 91 116 133 157 181 116 193 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 Except the year lost in 2009 due to the crises, we followed a pattern to duplicate sales and Ebitda in 4 years. TACC: Sales 16%; EBITDA 20% 26
27 CIE s success stands on
ADDED VALUE ANALYSIS AROUND A PRODUCT
HIGH TECH SECTORS ADDED VALUE ANALYSIS 29
Aerospace vs 30
vs mobile phones 31
The car industry represents a key area for the development of a country
INNOVATION IMPACT IN THE AUTOMOTIVE SECTOR AND IN OTHERS
Innovation can bring more value with less resources BOOK > e-book Shopping center > e-commerce CD/DVD > Download music/films Typing letters > e-mail 34
Innovation demanded in all sectors
Largest profit and job employers in USA 36
Jobless rates in the world
Positive economical growth around the world except in Europe 38
Self-enterpreneurship declines not only in Spain but also in Germany 39
Automotive main design regions
HOW IS THE AUTOMOTIVE SECTOR IN EUROPE?
Executed and potential plant closures in Europe MITSUBISHI-VOLVO in the Netherlands SAAB in Sweden PSA in France GM/OPEL in Germany and UK IVECO in Spain or Germany??
Excess of capacity shared by all brands
IMPACT OF THE ELECTRIC VEHICLE IN THE AUTOMOTIVE INDUSTRY
Emission legislations support innovation
Expensive electrification costs against moderate costs on ICEs
Many new components around ICEs increase added value in cars
Internal combustion engines (ICE) include many more components on traditional technologies
..but electric vehicles bring more electric and electronic systems and new technology Domestic charger plug Quick charger plug Battery system Power electronics Electric motor Inverter Helical / reduction gearset On board charger
Hybrid engines will bring many new business opportunities in the following years
Multipurpose platforms and new electric systems will bring many new jobs in engineering and production
Electric vehicles are already bringing business to CIE Automotive
Excess of vehicles accepted to support industry growth and job preservation
Increasing energy cost will also affect car mobility cost 54
CIE s RECIPES FOR SUCCESS
Steady growth through adquisitions and JVs Inyectametal (ESP) Udalbide (ESP) Unitools (CZ) Norma (ESP) C.Vilanova (ESP GSB-TBK ESP) CIE Celaya (MEX) Autometal (BR) (1) Plasfil (PORT) CIE Plasty (CZ) Gameko (ESP) Promoauto (BR) CIE Metal (CZ) CIE Kataforesis (CZ) SBC Cromado (BR) CIE China (CHI) Jardim Sistemas (BR) Pemsa Ramos A. (MEX) Pemsa Saltillo (MEX) Praga Louny (CZ) Gave (ESP) Nugar (MEX) Matic (MEX) CIE Avtocom (RUS) INSSEC Holding 1997 2000 2002 2003 2005 2008 2010 1996 1998 2001 Egaña (ESP) Greenfields Adquisitions Joint ventures Desinvestments Galfor (ESP) Orbelan (ESP) Tarabusi (ESP) Stuka (ESP) Mecauto (ESP) Mecasur (ESP) Autometal Bahía (BR) Fusión de EGAÑA y AFORAS A 2004 SBC Injection (BR) 2006 CIE Desc (MEX) (2) Pemsa Celaya (MEX) Autoforjas (BR) Durametal (BR) Matricon (RUM) Bionor Venta GSB Acero 2007 Nugar (MEX) Pemsa Ramos A. (MEX) Recyde (ESP y CZ) Nakayone (BR) Peer (LIT) Resigras (ESP) BCGSA (GU) NNE (BR) 2009 CIE Celaya (MEX) Pemsa Celaya (MEX) Autometal D. Avila (BR) ACS Group (FR, ESP, RUM, CHI) 2011 Fusión INSSEC-CIE e integración de DOMINION IPO AUTOMETAL Biodiesels (1) Compra del 50% en 2000 y el 50% restante en 2003. (2) JV en 2006 incluyendo CIE Celaya y Pemsa Celaya. En 2007 JV adquiere Nugar y Pemsa R.Arizpe. En 2008, 2009 y 2010 CIE adquiere el 50% de las Compañías en JV con Desc. Actualmente, todo México 100% CIE. CIE is a leader on strict disciplined adquisitions policy in an atomized market, through continuous reinvestment of the profits 56 56
Why did german car production recover so quickly?
Powertrain and chassis systems still to be exported from Europe to different regions CHINA INDIA IRAN RUSIA BRASIL MEXICO USA TOTAL 2011 European engine and transmission plants are enjoying the growth of new markets through the shipment of a large amount of powertrain systems. Russia, Brazil, India, Turkey, Iran are becoming very relevant customers that compensate sales downfalls in current turbulent EU members economies. ESPAÑA 36.614 10.338 4.720 61.588 1.409 26.004 55.891 196.564 FRANCIA 1.058 221 4.027 42.692 19.979 0 0 67.977 ALEMANIA 101.650 37.924 2.691 105.261 141 145.280 295.651 688.598 HUNGRIA 105.059 13.868 0 77.521 11.069 35.102 0 242.619 TOTAL 1.195.758 CHINA INDIA IRAN RUSIA BRASIL MEXICO USA TOTAL 2010 ESPAÑA 668 6.321 3.526 67.269 3.188 23.254 0 104.226 FRANCIA 508 0 11.803 29.552 22.331 0 0 64.194 ALEMANIA 67.218 17.956 2.805 57.081 12.592 119.751 320.768 598.171 HUNGRIA 120.751 10.670 0 71.585 0 55.445 0 258.451 TOTAL 1.025.042
Engineering capabilities through multitechnology approach 59
TRENDS IN PLATFORMS
GLOBAL PLATFORMS DEMAND GLOBAL SUPPLIERS Russia Nafta Europe China Korea SINGLE SOURCING WITH GLOBAL SUPPLIERS BRING GREAT SAVING OPPORTUNITIES FOR OEMs Design the part and the tool once Simple project management Back-up possibilities 61
ENGINEERING CAPABILITIES ENGINEERING: FROM DESIGN TO PRODUCTION DESIGN 3D MODELS OPTIMIZATION FROM DESIGN TO PRODUCTION ON COST ON PERFORMANCE ON WEIGHT AS PER CUSTOMER NEEDS FEM FEA Calculation Virtual analysis SIMULATION FEASIBILITY TRIALS Prototypes DURABILITY/STATIC & DYNAMIC MASS PRODUCTION TOOLING
CIE s recipes MULTITECHNOLOGY APPROACH- ALU+STEEL+PLASTICS UNDERSTAND FUNCTIONALITY OF THE PART+KEEP CONTROL OF DESIGN AND THE TECHNOLOGY TO PRODUCE IT GLOBALISATION OF PRODUCTION + STRONG R&D CENTERS LOW DEPENDENCE ON EACH CUSTOMER ( LESS THAN 10% OF TOTAL TURNOVER EACH ) NEW INVESTMENTS ON FACILITIES FOCUSED ON SEVERAL CUSTOMERS AND SEVERAL CAR MODELS 63 DECENTRALIZED MANAGEMENT WITH CORPORATE POLICIES AND STRONG SUPPORT IN THE BEGINNING
Engineering capabilities contribute to keep business in Spain FERRARI+MASERATI - new engine common rail system BMW-new coming M3 crankshaft VW- new Golf steering components RENAULT- new electric vehicles components
Reduce risk through diversification of products, technologies, customers, markets and sectors WIND POWER- components exported from Spain
New technologies are welcomed by everybody if they prove advantages towards old models Transportation sector still to bring many jobs through high innovation products!!
THANK YOU!