COVID-19 impact tracker for automotive

1. 12020-04-23-RB-Auto-COVID-19-Tracker-Dashboard-vSENT.pptx
April 23, 2020 USA Automotive Industry COVID-19 Impact Tracker
Situation summary
OEM plant target re-open dates3)
Plant closures4)
> Sales forecast: April sales forecast dropped
slightly to a 47% decrease vs April 2019, per
JD Power, however week over week volume
grew in all top 25 US markets showing an
initial rebound in demand. IHS is forecasting a
full year drop of -27% YoY as of April 16.
> OEM response: 100% of light vehicle
assembly facilities remain closed with many
targeting a May 4th soft-reopening date. With
China reopen and European plants restarting
as soon as next week, OEM's have been
shifting focus towards preparing guidelines
and procedures to ensure safe restart.
Reopening efforts will be on a site by site basis
with a slow ramp up of single-shift reduced
work week to start. Additional executive pay
cuts were announced this week, with most
major OEM's continuing to take steps to
secure cash flows.
> Supplier response: Continued cost cutting
measures are taking effect with several
suppliers announcing labor reductions and
executive pay cut measures. Even well
diversified suppliers are no longer sheltered
from the slowing effects of shutdown OEM's.
At the same time OEMs are pushing some
suppliers to reopen next week to be ready for
May 4th tentative relaunch.
> CV & Off-highway player response:
Incremental layoffs and furloughs continue
while CV and off-highway OEM's further build
up cash reserves and are still protected from
plant closures by being deemed "essential
business." Slowed production and shutdowns
are mostly driven by low demand.
Layoffs and furloughs4)
Executive pay cut4)
Credit rating downgrades4)
US LV market [m vehicles]
% of suspended production capacity
(indicative)
% of companies announcing layoffs % of companies' credit rating downgraded5)
% of companies reducing executive pay
Cash reserves4)
Dividend suspensions4)
% of companies suspending dividends
% of companies excessively drawing on
credit lines
0.99Mar
AvgQ2
AvgQ1
AvgQ3
1.37
1.44
AvgQ4
Jan
Feb
Apr0.53
1.34
1.48
1.43
1.14
Inventory levels2)Vehicle sales1)
2019 2020
AvgQ3
AvgQ2
AvgQ1
Feb
AvgQ4
Mar
Jan
4.03
3.94
3.64
3.57
3.45
3.58
3.75
2019 2020
Actual Forecast Actual
Based on publicly announced actions
1) Source – Marklines; 2) Source – Wards Intelligence; 3) Source – Autonews; 4) Since Mar 1, 2020
5) Moody's
100%
60%
56% 56%
100%
65%
4/16 4/23
65%
50%
43%
70%
74%
43%
4/16 4/23
29%
70%
55%
43%
80%
55%
4/16 4/23
70%
54%
71%
67%
70%
86%
4/16 4/23
40%
24%
0% 0%
40%
29%
4/16 4/23
20%
14%
14%
20%
19%
14%
4/16 4/23
Top 10 Passenger Vehicle OEMs Top 30 Suppliers
Top 7 CV & Off-Highway OEMs
Current restart date (4/23) Previous restart date (4/16) * Partial shutdown
* * *
Open
20-Apr
27-Apr
1-May
4-May
6-May
8-May
Mid-May
Indefinite

2. 22020-04-23-RB-Auto-COVID-19-Tracker-Dashboard-vSENT.pptx
The overall ramp-up process will depend on a coordinated lift of the
economic lockdown across regions
Ramp-up scenarios and duration to pre-COVID levels
1
Full scale ramp-up
2
Slow regional ramp-ups
3
Selective ramp-up of single
programs
Level of regional
coordination Fragmented reliefsCoordinated reliefs
Duration until full
ramp-up: 3months
Value
capture
Demand
catch-up
100%
"Normal" pre-
crisis level
Starting point differing by country, industry and
company
Overshooting due to catch up
of key customers
Day X
Time
Minor impact Major impact
Level of economic
disruption
Value
capture
Time
Demand
catch-up
100%
"Normal"
pre-crisis
level
Starting point differing by country, industry and
company
Day X
Interruptions due to continued
shutdowns in key countries
Duration until full
ramp-up: 6-9months
Duration until full
ramp-up: 12-18months
Value
capture
Demand
catch-up
100%
"Normal"
pre-crisis
level
Starting point differing by country, industry and
company
Day X
Slower, stepped incline in
case of additional hibernation
<100% steady-state
demand
Time
Source: Roland Berger
Extract from Roland Berger "Ramping-up Operations" study – LINK to full study

3. 32020-04-23-RB-Auto-COVID-19-Tracker-Dashboard-vSENT.pptx
A more detailed ramp-up checklist and playbook is available upon request
Roland Berger COVID-19 ramp-up checklist
Source: Roland Berger
Roland Berger developed an extensive menu
of actions plants can take to address the
COVID-19 crisis
Approximately 200 actions sorted by function
and value chain step
Long list of ramp-up actions available upon request!
Please send an email to COVID-19AutoIndustryUpdate@rolandberger.info with subject
"Ramp-up checklist" or reach out to your Roland Berger contact to get in touch with us
Individual actions range in priority from A –
Imperative to perform prior to Day X, to C –
Optional after Day X
Production / HR Engineering Logistics
Finance Procurement Maintenance
Estimate and plan for liquidity need for
several ramp-up scenarios
Implement strict controls for ramp-up
critical KPIs
Identify "at-risk" sourcing and develop
alternative sources
Re-assess overall supplier base
Verify supplier readiness before ramp-up Develop equipment start up
plan after hibernation
Develop redundancy plan for maintenance
team
Identify critical spare parts and verify
inventory levels
Implement strict safety/ protection
protocols
Rework shift schedule to allow better
social distancing
Engage union leadership to address
employee concerns
Rebalance lines for new volume
Redesign production layout for greater
social distancing
Install additional protection devices where
redesign is not feasible
Strengthen fragile supply chain
Ensure sufficient inventory for ramp-up
Intensify communication and sync with
supplier
Insource vendor work
COVID-19 ramp-up checklist
Extract from Roland Berger "Ramping-up Operations" studyExtract from Roland Berger "Ramping-up Operations" study – LINK to full study