2023 Automotive Summit and Industry Outlook

By: Jay Kramer & Gene Borzendowski

The South Carolina Automotive Summit is one of the highest-impact conferences in the State. Industry leaders visit Downtown Greenville annually to discuss evolving industry trends, innovations, and forecasts. Electrification was the hottest summit topic again in 2023 since EVs are driving the “Next Automotive American Revolution,” with manufacturing, supply chain innovation, sustainability, and raw materials all in the spotlight. While attendees were buzzing with excitement from a rapidly evolving and exciting industry, presenters detailed some of the factors that will be critical to the automotive industry’s success in the years to come.

Manufacture Locally, on a Global Scale
Automotive OEMs continue to make decisions to lessen geopolitical ambiguity by locating facilities near their customers. Manufacturers cite regulations in Europe, conflict in eastern Europe, and uncertainty in China as major reasons for local manufacturing. Using the “manufacture where you sell mindset,” supply chains will continue to follow the OEMs to fulfill local product demand. With heavy regulations across Europe and rising energy prices, the US will continue to see massive investments in automotive manufacturing, especially regarding EVs. Local manufacturing helps OEMs and suppliers eliminate a certain amount of supply chain risk and shipping delays that have plagued manufacturers in recent years.

Race for Raw Materials
Every manufacturer of electric vehicles will increasingly rely on new raw materials: nickel, lithium, cobalt, and copper, all essential in battery cell manufacturing. Demand for rare earth magnets will continue to peak as companies engineer more powerful and efficient electric motors. The companies or suppliers that can efficiently access these raw materials will be positioned for success in EV manufacturing. Some suppliers are even making vertical integration moves to acquire mining operations to keep control of the supply chain. A “Battery Belt” has started to surface in the US, running from Michigan to Georgia, and operations in these states will experience increased reliance on these raw materials. Just outside of Charleston County, Redwood Materials sits strategically at one end of the battery belt and will be positioned to supply a handful of OEMs with the batteries they need for success. China is strategically positioned for success in every aspect of the battery manufacturing process because they have access to mining and processing these materials and experience doing so. American manufacturers quickly identify global mining partners to compete as the EV industry matures for decreased reliance on foreign suppliers.

Sustainability Through Manufacturing Processes, Synthetics, and Material Circularity
Automotive OEMs are targeting fewer emissions from tailpipes and fewer emissions in the manufacturing process as a part of their comprehensive plans for carbon emissions. Almost every presenter touched on the importance of carbon neutrality as it becomes the new gold standard for manufacturing emissions. Automotive interior suppliers cite synthetics’ importance in replacing animal-based materials with high-performance substitutes with identical properties and functionality. Tire manufacturers continue to improve tread patterns and compounds to decrease road resistance and combat the 20% faster wear EVs experience with tires because of their torque. The quest for material circularity continues as material innovations are made inside and outside the vehicles of tomorrow.

Newcomers, Innovation, and Reality
The EV excitement in the automotive industry has driven dozens of new automotive companies toward new vehicle offerings across the globe. Some of the most celebrated exhibitors at CES this year were automotive companies showcasing their EV products, including the Vietnamese-founded company, VinFast. They will test a new model of renting batteries to their customers and change them out as needed to alleviate uncertainty in battery functionality and replacement. Tech companies previously unrelated to the automotive industry, Nvidia, Qualcomm, and Intel, are all surfacing as players in the EV supply chain market with a focus on driver-assisting tech and e-mobility solutions. Considerable innovations in battery efficiency, driver assists, autonomous busses, e-mobility, and dozens of new automobiles are offered as EVs. However, it is critical to understand that with all the innovation, marketing, and attention on EVs, only 10% of vehicles on the road in the US are anticipated to be electric by the year 2030.

While the next decade will reshape the automotive industry, Charleston County and the State of South Carolina are well positioned to support automotive OEMs and suppliers to achieve their EV goals regionally and nationally. With our robust logistics backbone, decades of experience in the automotive industry, and culture of innovation, Charleston County is committed to supporting the success of existing and new automotive companies across the County.