MEMA Original Equipment Suppliers Survey Reveals Supplier Base Feeling Impact of Industry Disruptions

Southfield, Mich. — MEMA Original Equipment Suppliers surveyed its members on the impact of the UAW strike against the Detroit Three. Vehicle suppliers employ over 900,000 workers, over six times more than the 146,000 UAW Detroit Three autoworkers. Additionally, suppliers contribute 2.5% of the U.S. Gross Domestic Product (GDP).

Key take aways from the September 29, 2023, survey include:

• Nearly 30% of surveyed vehicle suppliers have laid off some direct labor employees as a result of the strike.
• Additional suppliers will initiate layoffs with more than 60% expecting to begin layoffs by mid-October.
• 70% of vehicle suppliers have concerns about their sub-suppliers’ ongoing financial viability.
• More than 50% of idled suppliers indicated they need at least one week to return production to pre-strike levels.  

MEMA is working with the White House administration to develop a plan to provide financial assistance for smaller suppliers, defined as less than $200 million in revenue. The output of these suppliers, often Tier 2 or lower, is critical to the ongoing viability of the entire supply chain.

Another complication impacting the vehicle supply chain is the slowdown of commercial vehicle crossings at the U.S./Mexico border. Last week, MEMA co-led a meeting with the White House National Economic Council (NEC) and National Security Council (NSC) officials to address these border crossing delays.

The group had two recommendations for the NEC and NSC:

• Expand the border crossing hours in the U.S. Customs and Border Protection (CBP) El Paso and Arizona regions to accommodate the additional trucks using these locations.
• Ensure the U.S. CBP coordinates with the Texas Department of Public Safety (DPS) to expedite truck crossings throughout the southwest U.S.

To date, Texas continues to inspect trucks coming across the Mexican border.
MEMA Original Equipment Suppliers will survey members each week and share critical information from the results.

For additional information and comment, please contact: Megan Gardner, mgardner@mema.org, 919-636-2941.

About MEMA
MEMA, The Vehicle Suppliers Association, is the leading trade association in North America for vehicle suppliers, parts manufacturers, and remanufacturers. It has been the voice of the vehicle supplier industry since 1904. Its more than 1,000 members are Strong by Association.

Companies join MEMA via two membership groups: MEMA Aftermarket Suppliers and MEMA Original Equipment Suppliers. Automotive and commercial vehicle suppliers are the largest manufacturing sector in the United States and lead the way in new vehicle innovations.

Members conceive, design, and manufacture the OE systems and technologies that make up two-thirds of the value of every vehicle and supply the aftermarket with the parts that keep millions of vehicles on the road, fueling international commerce and meeting society’s transportation needs. MEMA members are committed to safety and sustainability.
 
MEMA has offices in Southfield, Mich.; Research Triangle Park, N.C.; and Washington, D.C. Learn more at MEMA.org.

About MEMA Original Equipment Suppliers
MEMA Original Equipment Suppliers exclusively serves automotive original equipment (OE) suppliers, a part of the largest manufacturing sector in the United States and leading the way in new vehicle innovations. Members conceive, design, and manufacture the OE systems and technologies that make up two-thirds of the value of every vehicle, fueling international commerce and meeting society’s transportation needs. MEMA members are committed to safety and sustainability.

MEMA, The Vehicle Suppliers Association, is the leading trade association in North America for vehicle suppliers, parts manufacturers, and remanufacturers. It has been the voice of the vehicle supplier industry since 1904. Its more than 1,000 members are Strong by Association.

MEMA has offices in Southfield, Mich.; Research Triangle Park, N.C.; and Washington, D.C. Learn more at mema.org/original-equipment-suppliers.

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