TRANSPORTATION UPDATE

 

NOVEMBER 2011

 

McIlvaine Company

 

 

TABLE OF CONTENTS

 

INDUSTRY

Automotive Designers Delve Farther Into Plastics' Flexibility

U.S. Plans to Double Fuel Efficiency Standards

China’s Auto Market Remains Buoyant

BMW, Others Investing in Carbon Fiber

 

COMPANY NEWS

Fiat to Close Sicilian Plant

Renault-Nissan Invests $1.8 billion in Brazil

Freudenberg to Make Filters in Western China

Tesla Motors Unveils Mass-Market Electric Car

Israel's Arkal Plastic Building $7 Million Plant in Alabama

Toyota Refines Prius Plug-in for 2012 Introduction

Toyota Says U.S. Retail Sales to Rise in October after Quake

Ford Introduces Castor Oil-Based Foam

 

INDUSTRY

 

Automotive Designers Delve Farther Into Plastics' Flexibility

Experts charged with lightweighting interior vehicle parts are rethinking what a car interior means and how parts can function in multiple ways to achieve aesthetic and operational goals, Plastics News reports.

 

The topic was part of the Plastics in Lightweight & Electric Vehicles conference, held Nov. 7-9 in Livonia, Mich. “Sustainable” and “conscious consumerism” no longer are trends or buzzwords. They have become part of the thread of culture, especially as governments issue higher standards for emission control and miles per gallon.

 

 In design thinking, customer, consumer and commercial needs are met along with sales targets.

 

The design approach to lightweighting looks at techniques such as biomimicry. For example, to develop a lighter prosthetic leg, designers might consider how bird nests are built in nature. By mimicking the webbing and intricacy of the interior of a nest, designers can achieve lightweighting goals — while also making the leg highly functional.

 

In rethinking a car interior, a lightweight headliner and trim garnish created with 100 percent PET has no cover and can act as an audio system.

 

Design experts can use multiple forms of plastic for one product. For example, a functional film on an overhead console may reduce mass and consolidate parts. Polypropylene thin film produces a good-looking and durable finish to a PP floor console frame, eliminating the need for heavy steel structures. In this way, parts are achieving enhanced performance. Composite plastics enable a thin lightweight seat structure.

 

To apply principles such as these, companies must build an innovative team around its problems.

 

The powertrain and chassis area of vehicles has seen a 40 percent increase in the use of plastics in the past 10 years, said Maurice Sessel, senior vice president of engineering with International Automotive Components North America of Dearborn, Mich.

 

“That will only increase,” he said, noting that the instrument panel alone has a lot of room to cut weight.

 

There remain opportunities in thin-wall uses. Experts have seen weight reduction of 5-15 percent using blowing agents when structural integrity is not compromised. The technique has been used in non-Class A surfaces.

 

U.S. Plans to Double Fuel Efficiency Standards

The Obama administration has proposed doubling fuel efficiency standards to 54.5 miles per gallon by 2025 to save motorists money at the pump and limit air pollution, the Financial times reports.

 

The plan is supported by environmental groups and by the auto industry, which estimates the changes will cost it $157bn, but they have come in for criticism from some lawmakers on Capitol Hill.

 

The administration said the improved standards would have tangible benefits, saving consumers more than $1,700bn at the pump, or more than $8,000 per vehicle, by 2025.

 

Automakers would have five years to develop fuel-saving technologies before the new standards started to take effect in 2017. The plan is now open for comment for 60 days

 

Under current standards, automakers must raise efficiency from 27mpg now to 35.4mpg by 2016.

 

China’s Auto Market Remains Buoyant

Millions of consumers are keeping the Chinese auto market relatively buoyant as the Chinese economy is slowing and sectors from property to steel are suffering from tighter credit, according to an article in the Financial Times.

 

China’s total automotive market – the world’s largest –is slowing, partly due to credit tightening moves by the central government. Sales of Mini commercial vehicle – small vans used largely for business – are down 5 per cent year-on-year in the first 10 months of 2011 and manufacturers are feeling the strain.

 

The story for passenger cars is very different. They remain resilient even after the withdrawal of tax incentives to buy small cars.

 

Car sales increased by 6 per cent year-on-year in the first 10 months of the year, and a recent consumer survey showed continuing strong demand for cars, especially at the higher end of the market.

 

Mercedes-Benz’s sales have risen 36 per cent this year, and General Motors’ sales last month increased 10 per cent year-on-year, although GM had to slash prices on its mini commercial vehicles.

 

This year’s 6 per cent increase in car sales, however, looks anemic compared with the past couple of years: passenger car sales rose 53 per cent in 2009 and 33 per cent in 2010.

 

Early in 2009, Beijing introduced tax incentives for small cars, as part of a broader economic stimulus package that inflated car sales in 2009 and 2010. The tax cuts were withdrawn this year. As a result, the China Association of Automobile Manufacturers (CAAM) recently forecast total vehicle sales would rise by less than 5 per cent this year.

 

BMW, Others Investing in Carbon Fiber

Carbon fiber, two-thirds the weight of steel yet five times stronger, is increasingly finding its way into automobiles. If a means can be found to use it in mass-production vehicles, it would result in dramatically improved fuel economy without resorting to exotic new fuels and engine technologies. Replacing the steel in a car with carbon fiber would shave hundreds of pounds off its weight.

 

Automakers are betting they can make it work, BMW in particular. BMW chairman Norbert Reithofer recently opened a new co-owned factory in Washington state that manufactures carbon fibers.

 

Carbon fiber consists of thin strands of carbon woven into a yarn that in turn can be made into cloth. The cloth in turn is then laid over a mold and stiffened with resin to produce a sheet of material with remarkable properties.

 

Carbon fiber has found its way into fishing rods and tennis rackets, and in larger quantities into airplanes like the Boeing 787 Dreamliner and the bodies of Formula One racecars. A couple of high-end performance cars like the BMW M6 and Chevrolet Corvette have carbon fiber body panels, and the material is used for interior trim in the place of wood veneers or aluminum.

 

But high-volume applications have eluded carbon fibers. For one thing, the material is expensive. According to published estimates, carbon fiber costs about $10 a pound. That's a lot cheaper than the $150 a pound it cost a decade ago but still ten to 20 times more than a pound of steel.

 

For another, the construction process is laborious and can't easily be scaled up. Curing time can take hours. Moreover, carbon fibers can't be recycled because carbon composites don't corrode.

 

That hasn't deterred BMW, which is investing $100 million to build a carbon fiber factory in Washington State, 180 miles east of Seattle. The factory is co-owned and operated by a German company, SGL Carbon SE. Production of carbon fiber thread is starting this month. The fibers will be processed into lightweight fabrics at a second joint venture site in Germany.

 

Other German automakers are following. Volkswagen, maker of Audi, has bought a 9.9% stake in the SGL venture. Mercedes-Benz is building its own manufacturing facility in Germany in cooperation with a Japanese company. Mercedes has a goal of reducing vehicle structure weight by 10% with each succeeding generation, according to Bloomberg.

 

All three companies have some catching up to do. Tiny McLaren, based in the U.K., plans to use a carbon fiber chassis as the basis for 1,000 MP4-12C sports cars it plans to build this year. Base price: $231,400.

 

COMPANY NEWS

 

Fiat to Close Sicilian Plant

Fiat’s Termini Imerese plant in Sicily is to close after 41 years of production as the Italian carmaker presses ahead with sweeping restructuring plans, including the imposition of new labour contracts that have prompted threats of strike action.

 

The closure is only the second of a car plant in Europe since the start of the financial crisis, which hurt car sales and exposed the industry’s chronic overcapacity problems. General Motors shut its Opel/Vauxhall factory in Antwerp last year.

 

Fiat met Italian government and union officials in Rome recently to discuss redundancy benefits and possible transfers for some 1,600 workers at Termini Imerese and an estimated 700 employed in connected industries.

 

The site will be taken over, for the symbolic sum of €1, in January by DR Motors, a small Italian manufacturer that assembles cars from Chinese components. According to a government agency, it has pledged to employ some 1,300 workers over the next four years and to invest about €100m ($134m), plus €30m in government grants.

 

Renault-Nissan Invests $1.8 billion in Brazil

Carmaker Renault-Nissan announced a combined investment of $1.8 billion in Brazil, where the companies plan to introduce 23 new models in an aggressive bid to increase their share of Brazil's booming car market, the company's president and chief executive Carlos Ghosn said recently.

 

Nissan Motor Co. will invest $1.5 billion in a new plant in Rio de Janeiro state, and Renault SA will put $285 million toward the expansion of a plant in southern state of Parana. The automakers' plan is to boost their combined annual production to 580,000 vehicles over the next five years.

 

Ghosn said the companies hope to increase their market share from 6.5 percent today to at least 13 percent by 2016.

 

Brazil is already the fourth-largest vehicle market in the world, behind the U.S., China and Japan, and is second only to China among emerging markets for new cars.

 

Brazil's expanding car market still has a lot of room to grow. While eight out of ten people in the United States have cars, in Brazil there are only 2.5 cars per 10 people.

 

Recently, the Brazilian government sharply raised taxes on imported cars and trucks in a bid to protect local industry. The Sept. 16 measure increased the industrialized products tax by 30 percentage points on vehicles that don't meet rules about local content.

 

Renault-Nissan's expanded presence in Brazil will allow the carmakers to minimize taxation, while also reducing transportation and logistics expenses by placing engineers and production close to supplier hubs.

 

Renault-Nissan's investment follows similar expansions announced by other carmakers.

 

Chinese carmaker announced in August that a new $600,000 million plant with an annual capacity of 100,000 units would be operational by 2014. Another Chinese brand, Chery started building a $400,000 million plant in July, aiming to 150,000 vehicles a year by 20156.

 

Toyota of Brazil announced in July 2010 the building of its third plant in the country, a $600 million investment which will begin production in the second half of 2012 at 70,000 units per year.

 

Freudenberg to Make Filters in Western China

Freudenberg Filtration Technologies will establish a new filter production site in cooperation with the Japan Vilene Group Ltd. in Chengdu (Sichuan Province, China). The site will be operational in January 2012.

 

The new company FreudenbergVilene Filter (Chengdu) Co., Ltd will be the third filter manufacturing site for Freudenberg Filtration Technologies in China. The other sites are located in Suzhou and Changchun. The new site in the Central Western part of China will operate particularly in the automotive filter segment, which has been experiencing remarkable growth. The production of both engine air intake filters and cabin air filters is expected to begin in August 2012.

 

Major automobile manufacturers such as First Automotive Works Volkswagen and Geely Volvo have settled their manufacturing plants in the Chengdu area. Automobile production in this region is expected to increase significantly in the following years, from 1.8 million units in 2011 to three million units in 2015.

 

Tesla Motors Unveils Mass-Market Electric Car

Tesla Motors showed off the first production version of the sedan it hopes will make it the first pure mass-market electric car company. The company said that more than 6,000 advanced orders had already accounted for its capacity next year.

 

The model S sedan was rolled out recently at a plant in California that has become a symbol for the maverick start-up’s ambitions to subvert the established car industry.

 

Once jointly owned by General Motors and Toyota, the 5m sq ft plant was intended as a showcase for international co-operation and advanced manufacturing techniques, but was eventually bought by Tesla for $42m, or less than 5 percent of its book value, after GM’s bankruptcy.

 

Tesla plans to ramp up production of the S, which is scheduled for launch in the middle of next year, to an annual rate of 20,000 by early 2013.

 

The top-of-the-range model, which will cost just under $70,000, will have a range of 300 miles, potentially overcoming one of the biggest drawbacks to mass demand for electric vehicles.

 

Tesla said it could eventually reach an output of 450,000 vehicles at the facility in three to four years, after introducing a lower-priced vehicle codenamed X.

 

Israel's Arkal Plastic Building $7 Million Plant in Alabama

Israel’s Arkal Plastic Products is extending its global manufacturing footprint with the first U.S. plant for its Arkal Automotive unit.

 

Arkal Automotive USA Inc. will go into a 32,000-square-foot building now under construction in Auburn, Ala., the company and local economic development officials said in a Nov. 29 news release.

 

Arkal Automotive has a molding facility in London, Ontario, supplying functional long-glass reinforced plastic parts to automakers in the Detroit and Ontario manufacturing region. It also has a sales office in Farmington Hills, Mich. The Auburn plant will focus on car manufacturers in and near Alabama.

 

Arkal, based in Kibbutz Bet Zera, is investing $7.2 million at the new site. It expects to hire 25 people when it launches production.

 

Arkal Automotive makes a variety of structural and functional parts, including battery trays, brackets and front end supports. It also has manufacturing in Israel, Spain, Poland, France and China.

 

Toyota Refines Prius Plug-in for 2012 Introduction

The latest Toyota Prius Plug-in boasts enhancements over the previous car, along with a full-blown marketing strategy.

 

During an initial presentation about the car, Toyota Vice President Bob Carter made it clear that the Prius brand would be a tent pole for the company. He talked up the four different models that will bear the Prius name: the original Prius liftback, Prius V, Prius C, and Prius Plug-in.

 

The price is set at $32,000, or $39,525 for a high-trim, fully loaded model, subject to a $2,500 federal tax credit, bringing the base car under $30,000. A refined battery pack is smaller than that of the previous version, yet it gives the car more pure electric range, 15 miles versus 13 miles. Taking the gasoline tank into account, total range remains at over 500 miles.

 

Toyota also moved the charging port. Where it had previously been at the front fender, Toyota moved it to the right rear, the opposite side of the fuel tank filler. Nobody should have a problem pouring gasoline over the car's plug, as the hatch cover also has an embossed plug symbol. Similar to the previous test model, charging times are rated at 3 hours for a 110-volt outlet, and 1.5 hours at a 220-volt outlet. Toyota is also partnering with Leviton to offer buyers a level 2 charger, which should take mere minutes to fill the battery.

 

Toyota estimates that the Prius Plug-in will earn an EPA rating of 87 mpg equivalent, using the calculation for a plug-in hybrid vehicle. Toyota says that, without charging the battery, the car would get 49 mpg.

 

The Prius Plug-in will include a set of apps to help manage its plug-in architecture. These apps are an extension to the new Entune app system Toyota will offer in its vehicles. On an Android or iPhone, an owner will be able to set a charge time, prerun the air conditioning, look for public charging stations, and even use the car's GPS to find it in a parking lot.

 

Toyota will initially roll out the 2012 Prius Plug-in in the 14 West and East Coast states that follow California's vehicle emissions regulations, with wider sales to follow. Prospective buyers will be able to place their orders online beginning in October.

 

Toyota Says U.S. Retail Sales to Rise in October after Quake

Toyota Motor Corp, Asia’s largest automaker, expects to start reversing a U.S. sales slide that began in May after Japan’s earthquake as vehicle production rebounds and deliveries of the new Camry sedan expand, Bloomberg reports.

 

Wholesale orders for Toyota brand cars and trucks are back to normal this month, and vehicle inventory is rising, Bob Carter, group vice president for U.S. sales, said in an interview. Toyota’s last U.S. sales gain was in April. The company’s U.S. market share through August fell to 12.7 percent from 15.2 percent a year earlier.

 

Toyota recently restored full production at all North American auto-assembly plants and said most would add overtime shifts. The company temporarily halted all production after the March 11 earthquake and tsunami and then slowed output due to parts and power shortages triggered by the natural disaster.

 

The quake also cut supplies of Japan-built Prius hybrids and luxury Lexus models, causing the Toyota City, Japan-based company’s U.S. sales to drop 7.8 percent this year through August while industry wide deliveries grew 10.5 percent.

 

Ford Introduces Castor Oil-Based Foam

Ford Motor Co., which was the first major automaker to begin using soybean oil-based urethane foam, is now debuting a foam with a castor oil blend.

 

The foam is part of a soft touch instrument panel in the 2012 Ford Focus sedan, and has 10 percent of its content from renewable castor oil, which comes from a plant grown throughout Asia. BASF SE is the material supplier.

 

Castor oil blends have been used previously in nylon used in under-the-hood applications.

 

In a Sept. 30 news release, Dearborn, Mich.-based Ford said the new foam blend has a better ability to maintain its shape over the car's lifetime. It also cures 43 percent faster than traditional foam blends, which improves the manufacturing process.

 

Ford said it plans to expand the use of castor oil foam blends throughout its product line globally.

 

 

   

 

McIlvaine Company

Northfield, IL 60093-2743

Tel: 847-784-0012  Fax: 847-784-0061

E-mail: editor@mcilvainecompany.com

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