It's a sensitive topic. As automakers in the US and across the globe move to electric vehicles over internal combustion engine (ICE) vehicles to meet climate crisis priorities, lower emissions, and reduce dependence on oil, a hard reckoning is on the horizon - the production and assembly of electric vehicles requires fewer workers than currently required for ICE vehicles.



The industry needs to have that open conversation about automaker jobs - now, so says QAD's Vice President, Automotive and Mobility, Tom Roberts in his recent article, "An Honest Conversation, About Jobs and Chips" inEmbedded Computing Designmagazine.

Roberts echoescommentsfrom Daimler CEOOla Källenius, in May of 2021, "We have to have an honest conversation about jobs. Everyone knows it takes more labor hours to assemble and build a combustion-based powertrain compared to an electric powertrain."

Automakers in Germany foresee a loss of 75,000 jobs building engines and transmissions by 2030. In the US, an all-electrified fleet could mean theloss of 30% or more supplier jobs, according to Motor & Equipment Manufacturers Association, Senior Vice President of Government Affairs, Ann Wilson.

The number of job losses and economic consequences could be catastrophic if the stakeholders do not start immediately with a plan to retrain and deploy workers to produce electric vehicles, and their batteries, chips and related assemblies. The conversation among OEMs, tiers, unions and governments must focus on ways to save jobs while transitioning to electrified vehicles that also allows for value creation and profitability.

The Automotive Labor Pool

Automotive manufacturers looking at retraining, retaining and redeploying their workforce will require strategic planning and an honest understanding of the staffing requirements for the production of electric vehicles. Planning now to develop strategies and implement technologies to expedite onboarding and training/retraining is a must.

Deploying workers in the most efficient way during the transition from ICE vehicles to EVs will require strategic planning. For example, certain engine plants will still be needed for legacy ICE vehicles while other plants/production and assembly facilities will need to be retooled for battery, chip and related accessories production.

Vertical Integration of the Supply Chain

In addition to restructuring the automotive labor pool, manufacturers need to look at the condition of the supply chain. The future success of electric vehicle production depends heavily on controlling and integrating a vertical automotive supply chain, particularly in battery and chip production.

A resilient andintegrated supply chaininvolves planning, execution and adapting to disruptions. Among many critical steps, manufacturers need to:

  • Maintain the flow ofreal-time demand and supply data.
  • Automate customer processes with global trade software and utilize free trade agreements to streamline and automate global trade operations.
  • Leverage digital technology and insights with suppliers with end-to-end connectivity, real-time tracking and predictive analytics.
  • Improve supplier development by creatingcollaborative relationships with suppliersand standardizing communications, quality and responsiveness.

Manufacturers can assess theirsupply chain efficiencyand agility with QAD'sIntegrated Supplier Management diagnostictool. The tool assesses and ranks a company's supplier management maturity and gauges business adaptability, particularly its strengths and weaknesses in supplier disruption.

As we describe in our recent ebook, "Profitable Auto Supply in an Autonomous Connected Electric Shared (ACES) World," companies that invest in R&D and technologies will withstand the coming transformation in the way vehicles are designed, produced, sold and driven over the coming years.

The time is now for the automotive industry to have an honest conversation about the industry's future, with a focus on automotive jobs. Check out thefull articleinEmbedded Computing Design magazine.

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QAD Inc. published this content on 30 September 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 September 2021 16:01:07 UTC.