20-21June 2013 BITEC, Bangkok -Thailand

Automotive Australian 2020

by

AutoCRC Ltd
1

Scope
Current

Structure of the Australian Auto Sector Challenges Facing the Automotive Sector Automotive Australia 2020 Technology Roadmap Implementation of the Roadmap
Business Excellence Initiatives - ASEA Research Initiatives - AutoCRC

Scope
Current

Structure of the Australian Auto Sector Challenges Facing the Automotive Sector Automotive Australia 2020 Technology Roadmap Implementation of the Roadmap
Business Excellence Initiatives - ASEA Research Initiatives - AutoCRC

Australian Automotive Industry

There are 3 Car Manufacturers and 2 Truck Manufacturers in Australia.

Ford - Vehicles Holden - HQ & Engines Toyota - Engines & Cars Ivecco Trucks Kenworth - Trucks Holden - Vehicles Ford - Engines

Australian Automotive Industry

..and more than 500 suppliers, including many global companies

NSW Tenneco Victoria Bosch Continental Dana Denso Futuris Hella Toyota Boshoku

S.A. SMR Tenneco Toyoda Gosei

Australian Automotive Industry Employment

Exports & Imports

Australian Automotive Industry

Currently manufactures 200,000+ per Year

Approx. 30% Export

Australian Automotive Industry

Strengths

The capability to produce a vehicle from a drawing, through the complete manufacturing process, all the way to the dealership is a capability possessed by just 13 countries and Australia is one of those. Global design and testing facilities. As one of the largest industry spenders on Research and Development , the automotive industry is seen as the pinnacle of manufacturing.

Approximately AUD$650 Million

For every direct job in the industry, 5 - 6.5 jobs are provided in ancillary industries - multiplier effect

High levels of skill and innovation

8

Scope
Current

Structure of the Australian Auto Sector Challenges Facing the Automotive Sector Automotive Australia 2020 Technology Roadmap Implementation of the Roadmap
Business Excellence Initiatives - ASEA Research Initiatives - AutoCRC

Challenges facing the Auto Industry

From the mid 1980s until 2010 the highly protectionist policy regime Import tariff rate of only 5% applying from 2010 onwards. Free-trade-agreements for example with Thailand, USA and Malaysia (which reduces the effective tariff rate to about 3.5%) Most open market for vehicle imports of any of the 13 automotive producing countries in the world. Changing consumer preferences and increase in choice in brands has steadily reduced the market share and the volume of locally produced vehicles. Compounding these factors, the Australian dollar has appreciated by as much as 50% against our major trading partners in recent years In 2004 the industry produced 410,000 vehicles, achieved a domestic market share of 30% and exported $5.3 billion dollars of vehicles and components. In 2012 the industry produced 220,000 vehicles, resulting in only 12.5% share Extrapolating first quarter sales in 2013, the locally produced vehicle market share for 2013 calendar year may be less than 10%. Global Architectures
10

Scope
Current

Structure of the Australian Auto Sector Challenges Facing the Automotive Sector Automotive Australia 2020 Technology Roadmap Implementation of the Roadmap
Business Excellence Initiatives - ASEA Research Initiatives - AutoCRC

11

Automotive Australia 2020

Goal: Define a technology roadmap for Australian automotive industry Initiated June 2009 by Auto Industry Innovation Council Funding from AutoCRC, Australian (DIISR) and Victorian Governments Delivered by

ANU AutoCRC University of Cambridge CSIRO

Reference group to provide oversight and policy direction

12

Automotive Australia 2020

Scope

Engage industry, technology providers and government Understand short term needs Identify long term trends Match Australian capability with industry needs Identify gaps Provide a roadmap for the auto industry to 2020+

13

Broad Participation

160 Organisations
-

Vehicle Producers Suppliers Researchers Industry Bodies Governments Aligned External Organisations (Defence, Aerospace, Resources, etc.)

220 Individuals 2,500 hours of Direct industry engagement.

14

Populating the Roadmap

Past
2009

Short term

2011

2012

Medium term

2015

2016

Long term

2020

Vision

Social

TRENDS & DRIVERS

Technological Environmental Economic Political & Legal

STAKEHOLDERS

National Government Regional Government MVPs Supply Base Other Stakeholders Body

1. Establish Vision

MARKET NEEDS

Chassis Driveline Electrical Control Engineering Services Manufacturing Processes Other

4. Identify Key Strategic Capabilities 5. Develop 4. Develop Opportunity 4. Develop Opportunity 4. Develop Roadmaps Opportunity Roadmaps Opportunity Roadmaps Roadmaps

2. Understand Future Global Market Need 3. Understand National Capability

CAPABILITIES

Auto Supply Base Non-Auto Supply Base Science Base Resources Other

ENABLERS

Infrastructure Skills & Competencies Alliances & Networks Finance

Cross-cutting Enablers

6. Prioritise Opportunities
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Automotive Australia 2020 Vision

As concerns over environmental challenges and energy security drive increased public awareness of emissions and efficiency, a paradigm shift is looming in the automotive market

Through advanced green car initiatives Australia can become one of the worlds leading designers and producers of zero emission passenger vehicles

16

Capabilities & Opportunities

Capabilities

Interviews Surveys

Automotive Non Automotive Research

Workshops International assessment by Deloitte Vehicle producer interviews Workshops

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Opportunities

Capability + Attractiveness = Australian Opportunity

AA2020 Results

Technology Roadmap for the Australian Automotive Industry

With a view toward the global market Building on current and developing capabilities in the Australian industry Electrification Gaseous Fuels Light-weighting Data and Communication Systems

Four Priority Opportunity Areas

1. 2. 3. 4.

32 Specific Applications 32 Recommendations

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Applications: Vehicle Electrification

Short Term (2010 - 2012)

Market still emerging, limited by product availability

Super-capacitors increased energy density for existing battery chemistries Seamless integrated charging infrastructure Hybrid and electric vehicle production for fleets and taxis Modular EV powertrains and modular, standardised battery pack Software and hard ware for EV specific driver interface Design and assembly of power electronics modules System solutions for EV architectures High energy density batteries Low cost, robust and efficient electric machines

Medium Term (2012 - 2016)

Long Term (2016 - 2020)

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Applications: Gaseous Fuels

Short Term (2010 - 2012)

Fast fill solutions for LPG Expansion of LPG retrofit market High capacity, low cost, on-vehicle storage tanks for CNG

Medium Term (2012 - 2016)

Natural gas vehicle technology Dedicated LPG system for direct injection engines Increased availability of natural gas refuelling

Long Term (2016 - 2020)

Gaseous options still relevant in the face of strong trends away from fossil fuels
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Applications: Light Weighting

Short Term (2010 - 2012)

Reduced vehicle structure weight by 30% Lightweight road wheels Materials and processes for recycling

Medium Term (2012 - 2016)

Energy absorbing foams and adhesives 3D Knitted composites for interior structures Lightweight body and door panels Replacement of steel components with lightweight alternatives E.g. Al, Ti, Mg and composites

Long Term (2016 - 2020)

Light weight modular vehicle platform

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Applications: Data Communications

Short Term (2010 - 2012)

Roll-out of diverse existing technology options Integration of related devices, improved driver interfaces

Medium Term (2012 - 2016)

Provision of real-time traffic congestion and incident information Next generation car navigation systems Improved HMI and driver information

Long Term (2016 - 2020)

Provision of dynamic speed limit information Data-gathering from road signs, delivery from central data hub

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Enabling Actions

Industry Collaboration
Research
Policy

- Industry

Government Support
and targeted research programs performance

Science and Research

Material Training

Education and Training

of industry
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Feasibility and Planning

Reference: www.autocrc.com/about/2020

Scope
Current

Structure of the Australian Auto Sector Challenges Facing the Automotive Sector Automotive Australia 2020 Technology Roadmap Implementation of the Roadmap
Business Excellence Initiatives - ASEA Research Initiatives - AutoCRC

24

AutoCRC Ltd
AutoCRC Ltd

Business Excellence Division

Research Division

Enables & Supports Quality Research

25

Business Excellence Division

Objective: Help the automotive supply chain achieve world class levels of competitiveness and sustainability.
Led by AutoCRC since commencing in 2007 Funding from government and participating companies Focus on manufacturing and business systems

Oversight by Steering Group, including Government, Association, and executives from all local Carmakers
>350 improvement projects completed across 100+ companies

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27

ASEA: Assessment & Project Process

The Process includes:
An Assessment that is Comprehensive & Company-wide. Outputs include: A Benchmark Report (11 Competencies, 52 Metrics, 20 KPIs) A set of prioritised Improvement Plans addressing the critical gaps Prioritised in order of importance to the business - Safety/Finance/etc. Discuss, scope, implement and complete the Projects Where possible, Start with priority 1 Continually ask for and monitor feedback
Assessment 1. Benchmark Report 2. Improvement Plans Scope Project Scope

Implement & Complete Projects

Project Management Document
Company
1. Project Status
0
X / / O

Report No
Project Title
Outlook

[Report Updating - weekly and reporting period as per section 7 - this paper]
Lean Management Solutions, Ian Wadeson Doc PMD Issue No 01091208

Harrington's Current No of Key issues 1

[refer section 9 - this paper]

Strategic Business Planning [SBP] Dec Jan 11 22 Activity

Owner Wk1 Wk2 Wk3

Date
Feb 29
Wk4 Wk5

##
26 Mar 5
Wk9 Wk10 Wk11 Wk12

8. Schedule
0
X / / O

10
Wk6

19
Wk7

No

Wk8

2. Project Statement
Background (Why) Refer to original ASEA Scoping document signed by Harrington's and ASEA Description (Plan) Refer to original ASEA Scoping document signed by Harrington's and ASEA
1 2 3 4 5 6 7 8
Skills / attributes Utilisation

Current status line (eg. end of week6)

Initial Meeting Kick off meeting Training day 1 & 2 Situational analysis Swot summary Strategic objectives Strategic options Develop action plans

3. Key Project Resources

Resource Description

9 Develop strategic plan 10 Prepare PPT for training day 3 11 Training day 3 12 Finalise strategic plan 13 Implement plan 14 Monitoring plan

ASEA ASEA AIM H H H H H H H

AIM H

1.5 weeks behind plan 0.5 weeks ahead of plan

Managing Director Key Managers

Project Management Participate

Facilitation Company knowledge

100% 100%

1 week behind plan 1.5 weeks ahead of plan

H H

4. KPI's
70 60 50 40 30 20 10 0

KPI 1 - Time Commitment

Target Actual 1.2 1 0.8 0.6 0.4 0.2 0 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 Target Actual

Reporting Coaching

5. Project team [Project management]

Company

Name

Contact Nos

9. Issues (Risks)
No What? Countermeasure action by whom? by when?

Business improvement leader Project leader Program manager Coach

AU$

John Harrington John Harrington

Name

0418 285 628 0418 285 628

Contact Nos

1 Attendance

Communicate schedule and ensure attendance.

JH

16.12.08

ASEA

Peter Taylor Steve Robinson

+61 3 9681 8626 0417 340 761

6. Budget
Materials/Equipment Personnel internal external Operating expense Total

Budget plan / status

70 Target Actual 60 50 40 30

$37,000 $25,000 $62,000

20 10 0 1 2 3 4 5 6 7 8 9 10 11 12

7. Company Communications
To ASEA Board From Managers Managing Director

10. Sign off / Approval

How Training Day 3 Presentation Freq' ? M
(D,W ,M)
Company

Kick off approval Original Scoping Document Original Scoping Document

Phase 1

Phase 2

Phase 3

Completion

Feedback

ASEA

27

28

ASEA: Engagement Process

Typical Models
SME Client
Assessment Projects

The simpler for the client, the more they will use it.

Delivery Relationship Management

Coaching Mentoring

ASEA >90% conversion from the Assessment to multiple projects.

SME Client Relationship Client Manager Management

Projects Coaching Mentoring
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If difficult for the client, they will NOT use it.

Conversion from Assessment to Project = ?? The ASEA model looks more expensive, but is probably not.
Volume allows negotiation of lower delivery rates.

Delivery
Assessment

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ASEA: Products (Training/Coaching)

Original Products (2008 - 2010)

Latest Products (2010 - 2012)

PEOPLE AND PERFORMANCE

1. PEOPLE STRATEGY

Before Score Average Company After Score

2. PERFORMANCE MANAGEMENT

5
11. METRICS

4 3
10. RECRUITMENT

2
1

3. EMPLOYEE LEARNING AND DEVELOPMENT

0
9. WORKFORCE PLANNING / TALENT MANAGEMENT
4. COMMUNICATION / CULTURE

8. LEGISLATIVE PROCESSES / AUDITS

5. ORGANISATION DESIGN

7. POLICIES & PROCEDURES

6. COMPENSATION / REMUNERATION

New Products (2012 - 2013)

Marketing Principles, Diversification, Export Markets

29

30

ASEA: Progress of Suppliers

Assessment Competencies
Technology investment
5.00 4.00 3.00

(Average of 29 Companies between 2008 2011)

Cost structures and analysis tools

45% Improvement
Customer focus

23% Improvement
Supply chain integration

39% Improvement
Financial systems and practices

2.00 1.00 -

Safety

Global sourcing and marketing strategies

16% Improvement
People and performance

19% Improvement
Management and Leadership

New model introduction capability

Manufacturing and Quality

AVGE 2008 AVGE 2010 AVGE 2011

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Research Division

Originally established as the CRC for Advanced Automotive Technology in 2005 National Centre for automotive research collaboration between industry and Australian research organisations Initial research programs were focused on smarter, safer, cleaner vehicles

10 research organizations and >20 companies Completed >90 industry projects, graduate 70 PhDs, engaged >300 undergraduate students

In July 2012 a second round of funding was approved by the Commonwealth Funded until 2017: $72m cash and in-kind contributions from 30 participants in 4 countries Research program now known as
31

Research Program Structure

Vehicle Electrification
Breakthrough Battery Advanced EV and Hybrid Powertrains
Fit with Roadmap

Gaseous Fuels
Uptake of Alternative Energy for Transport Fast-fill, High Capacity Storage Solutions
Research Quality Company Needs

Sustainable Auto Manufacturing

Lightweight Structures Advanced Coatings

32

Research Participants
Research Participants in the research programs

33

Industry Participants
Industry Participants in the research programs

34

Current Research Projects

Theme One

Air-Lithium Battery for Electric Vehicle Novel Cathodes for high Performance Li-Ion Battery Design and Prototype of on-Vehicle Battery Management System for Electric Vehicles Electrical Steel Thermoelectric - Efficient energy recovery in light and heavy vehicles Innovative Interior and Exterior Lighting EEV Market Forces Study Research Fellow for gaseous Fuels Pickup Canopy Development - SAMMITR CECAP Research Project Virtual Paint Plastic Injection vMould Design and Process Optimisation Lightweight Plastic Glazing for the Automotive Industry and Next Generation Automotive Coatings eWood Characterisation Advanced Energy Absorption Flexible Roll Forming of a Component Section from AHSS Tool Wear Prediction Model on the Stamping of AHSS and UHSS 3R's:Recyclability, Recoverability, Reusability

Theme Two

Theme Three

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SME: R&D Success Stories

SMR - UniSA - AutoCRC

Measure - Created a production-ready advanced coating technology and process for lightweight, low cost, plastic mirrors (patented) in <3years Benefit - Created a new product for SMR and technology partnership with UniSA Proof - Major production contract with Ford, dedicated research infrastructure at UniSA, and ongoing R&D into new products
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SME: R&D Success Stories

Futuris - Deakin University - CSIRO - AutoCRC

Measure - Developed an advanced lightweight composite seat frame to ADR requirements

Benefit - Created a new product/system with flow on fuel economy benefits

Proof - Victorian Science Agenda funding, technology partnerships

37

Questions
Contact Details:
Mr Linsey Siede Director ASEA AutoCRC Ltd +61 400 375 874 linsey.siede@asea.net.au

38

Thank You

Thank You
39