American supplier association, OESA, says a positive spin-off to emerge from the catastrophic downturn of a few years ago, is a better understanding of the component industry by Washington.
Significant downsizing due to the market crash of 2009 has now been replaced by a booming US automotive market, which could reach 17.2m vehicles this year and OESA (Original Equipment Suppliers Association) says regulatory authorities are now better placed to to understand the component role.
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“One of the positive outcomes of 2009 was the better understanding of the economic contribution the supplier base provides the industry- when you have vehicle manufacturers talk about supplier relationships there is better recognition of the supplier impact in Washington,” OESA SVP industry analysis and economics, Dave Andrea, told just-auto at the body’s headquarters in Troy near Detroit.
“The other important education…was to document how automotive supplier employment is in the States – it is not just an upper Mid-West or Great Lakes industry – it does truly affect South East States [too].”
Andrea noted the geographic footprint of the US supplier base had improved the “political clout” the industry enjoys in Washington, while OESA also works with partner Motor Equipment & Manufacturers Association (MEMA) in the US capital.
Keeping with a political theme, OESA has also been watching trade and industry harmonisation standards between the US and European Union (EU), particularly in light of the current TTIP (Transatlantic Trade and Investment Partnership), aiming to create what would potentially be world’s largest free trade zone.
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By GlobalData“The regulatory environment is becoming more harmonised and if you move TTIP forward and Free Trade Agreements with the EU, part of that is not just on the economic side, but [also] on the manufacturing side,” said Andrea.
“From an industry standpoint, it makes sense to design and test vehicles to a common standard.”
Andrea also highlighted the importance of the US recycling programme at the height of the downturn as an example of Washington directly intervening in a positive manner.
“If you look at our cash for clunkers programme in 2009, that was an experiment, but when you see the direct correlation of how that cash infusion went to the vehicle manufacturers, pulling back employment which came back to the supply base, it was a great, great, success,” said Andrea.
“That was an effective and rational use of government policy to simulate the economy.”
