Detroit Free Press
Dec. 11, 2024
Eric D. Lawrence
The auto industry wants stability, but it needs to adapt to change.
That was the message Glenn Stevens, executive director of MichAuto, delivered ahead of a panel discussion on the state of the auto industry Tuesday evening at the Detroit Regional Chamber downtown.
While Stevens, who is also the chamber’s vice president of automotive and mobility initiatives, was referencing issues such as the rise of China, artificial intelligence and labor issues, among others, General Motors gave the panel a bit of news to dive into with its abrupt announcement that it would pull the plug on its Cruise robotaxi business in favor of personal vehicle autonomy.
John McElroy, host of Autoline, told panel moderator and WJR radio host Guy Gordon of his concern that GM was ceding ground in the autonomous vehicle space to companies like Waymo in what amounts to a race between the United States and China.
“To me it’s a blow,” he said.
The discussion, which included Ford Motor Co. Chief Economist Emily Kolinski Morris and ADAC Automotive President and CEO Jonathan Husby, returned to China to several times, and McElroy emphasized the need for those in Detroit to pay attention. The U.S. auto industry has to do things differently, he said, emphasizing the speed at which China’s industry moves.
“The Chinese are copying Tesla, and that’s what Detroit especially has to do,” McElroy said, predicting a painful transition with so many silos here.
McElroy pointed to a risky time for the industry, beyond just China, to include demographic shifts, vehicle affordability and overinvestment in electric vehicles that aren’t yet paying off, with “a four-alarm bell going off.”
Still, McElroy noted that even though EVs have not hit the sales rate that those who have invested in them had hoped, he believes they are the future. And he described EVs as offering a better driving experience.
When the topic shifted to tariffs on EV imports from China, Kolinski Morris noted that economists don’t love tariffs. They can be a short-term tool, she said, as long as they aren’t relied upon for too long, one that offers an opportunity to protect a fledgling industry. As for the possibility of tariffs on products from Canada and Mexico, something President-elect Donald Trump as threatened, she described those neighboring countries as friends and she said she hopes that cooler heads prevail.
In addition to hosting the panel discussion, MichAuto, which describes itself as “the state’s only automotive and mobility association,” was also rolling out the results of a new economic contribution study of Michigan’s mobility industry, going beyond automotive to include a broad look at transportation-relation services and products.
Here are a few highlights from the study prepared by Public Sector Consultants. The study found that in 2022 Michigan’s mobility industry:
- Directly employed more than 631,000 workers statewide, which supported an additional 525,000 indirect and induced jobs.
- Directly and indirectly paid nearly $83 billion in compensation, at annual average pay of $71,547.
- Directly and indirectly contributed nearly $348 billion in gross economic output.
- Directly and indirectly generated more than $14 billion in state and local taxes.