Auto Parts Suppliers Worry Over Pace of Electric Vehicle Transition
The growing adoption of electric vehicle is something that has auto suppliers feeling anxious, reports Roll Call.
Specialty Equipment Market Association (SEMA) CEO Mike Spagnola recently stated that while the organization is not opposed to EV adoption, the 7,000 predominantly small suppliers it represents can’t keep up.
According to SEMA, about a third of its products are ICE dependent. With internal combustion engine vehicles having hundreds more parts than EVs, parts suppliers are preparing for a slump in sales, with last year seeing a $52 billion decline.
Spagnola criticized the recently finalized EPA regulations on vehicle emissions, citing other modes of clean transportation besides only EVs, such as hybrid and hydrogen vehicles. He has been joined in this sentiment by the Motor & Equipment Manufacturers Association (MEMA), who has voiced support for the EPA regulations but noted that other technologies should be promoted alongside EVs.
A Deloitte study from last year underscored the difficulty for parts manufacturers to keep up with the EV transition, with little being done to help them adapt to the path auto manufacturers are going.
Some action has been taken to help the parts industry, with the U.S. Department of Energy having recently granted $100 million to small and medium-sized companies to help them through the change. A report released last year by L.E.K. Consulting also highlighted opportunities for suppliers in the EV sector, such as repairing batteries and developing brakes and tires for heavier vehicles.
“The ones that don’t prepare for the transition will have the hardest time,” said Alan Taub, a former auto executive and current director of the University of Michigan’s Electric Vehicle Center.
