Revving up for the auto recovery

Who would have thought, just a few short years ago, that 2014 would be a good time to be a moldmaker or automotive supplier?

Market analyst IHS Automotive projects that automakers will build 16.1 million cars and trucks in North America this year — up four per cent from 2013, and a ten-year high.

It’s good news and it will likely get better still. Analysts such as Canada’s Dennis DesRosiers are forecasting historic levels of new work that will be up for bids to North American auto parts molders and moldmakers.

In service of post-recession pent-up consumer demand, automakers expected to launch approximately 70 new vehicle models each year for the next five years — compared with about 40 all-new vehicle models launched each year before the auto slowdown and recession — each of which will need new molds for new exteriors and interiors, including new body moldings, new fascia, new lighting, new electronics, and new under-the-hood parts.

And it’s more than just unit growth; the auto industry is poised to pick up business from OEMs looking to cut vehicle weight to satisfy upcoming CAFE regulations.

But there’s a problem: the manufacturing sector — and the mold, tool, and die industry in particular — is nowhere near the employment level it should be to take advantage of the automotive growth.

In 2006, for example, there were 27,626 workers in the tool, die, and machining field, according to Statistics Canada, a number that plummeted to 18,597 in 2010. And it hasn’t really recovered.

Given that handicap, is the Canadian automotive sector ready for the resurgence?

We’d better be because — bet on it — competitors in weaker global markets are going to be swarming in faster than flies at a barbecue.

— Jim Anderton, editor Canadian Metalworking, and Mark Stephen, editor Canadian Plastics