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Shift to electric vehicles will radically change auto factories

Ian Thibodeau
The Detroit News

The flood of electric vehicles rolling out over the next decade will have many fewer parts and assemblies than today's gas-powered cars and trucks. And that will radically change the auto factory floor, with fewer jobs and the real possibility that the batteries and electric motors that power the new vehicles could be sourced offshore.

Think about it: Fully electric cars don't have multi-speed transmissions, radiators, fuel injectors, gas tanks, valvetrains or exhaust systems, to name just a few differences. While conventional drivetrains have as many as 2,000 parts, electric drivetrains can have fewer than 20.

At the most basic level, it's an electric motor and a big battery. And those could easily be imported rather than built by an automaker or U.S. supplier.

A battery-electric Chevrolet Bolt EV makes its way down the assembly line at General Motors' Lake Orion Assembly assembly plant.

The prospect has caused enough anxiety at the United Auto Workers union that it issued a nearly 40-page report this year on the "implications" of electric vehicles, and how to address them.

"There's going to be an absolute shift in jobs in manufacturing," said Sam Abuelsamid, the principal analyst at Navigant Research who focuses on mobility. "A lot of the individual small components that go into vehicles today, especially in engines, a lot of that stuff is going to go away."

General Motors Co., Ford Motor Co. and others have announced their most aggressive electric vehicle plans to date. Over the next decade, GM and Ford will introduce dozens of battery-electric vehicles to compete in markets around the world. And while most experts don't expect electric vehicle sales to surpass those powered by conventional gasoline engines within the next three decades, the new-age propulsion threatens to disrupt a century-old manufacturing process that currently employs thousands.

The UAW and the Detroit Three automakers aren't expected to make electric vehicles a focal point of contract negotiations for at least another four years. All are in the middle of negotiations for contracts that will carry the UAW through to 2023. But there are already signs of unease at Solidarity House.

The labor union commissioned a study titled "Taking the High Road: Strategies for a Fair EV Future," which laid out all the threats the "coming shift to EVs" could bring to U.S. jobs. Electric vehicle powertrains will become cheaper, competition will get more intense and more governments will continue to enact strict emissions mandates. And that means demand will rise for cars and trucks that require fewer people to build.

The study concludes that the shift to electric vehicles will displace workers and potentially shift contracts and employment to non-auto companies to build some components. It suggests that those potential downsides offer a chance to reinvest in U.S. manufacturing by training workers to build the parts for the new vehicles, and potentially create new manufacturing jobs to ensure the work stays within the U.S. manufacturing ecosystem.

"This shift is an opportunity to reinvest in U.S. manufacturing," the study offered. "This opportunity will be lost if EVs or their components are imported or made by low-road suppliers who underpay workers."

Part of the uncertainty, according to experts, is that automakers, politicians and other key stakeholders aren't totally sure how drastically or quickly electric vehicles and other new technology will change U.S. manufacturing.

"Electrification in broad terms is still a long way off," said Kristin Dziczek, vice president of industry, labor and economics at the nonprofit Center for Automotive Research. "It's important that (the UAW) be focused on how things are going to change. The change may not necessarily be widespread in the next decade."

The Center for Automotive Research and other firms focusing on the impact of new technology on the auto industry don't expect electric vehicles to account for more than 10% of the sales market until the late 2020s. That's when electric vehicles could start to shake things up.

Ford plans to build its first-ever fully battery-electric crossover in Mexico for sale in 2020. The automaker has a fully battery-electric F-150 planned, and other fully electric vehicles based on familiar nameplates are expected. All told, Ford plans to spend $11 billion on electrification over the next several years.

GM plans to introduce 20 new electric vehicles by 2023. The automaker's next-generation EV architecture — which will debut on an all-new Cadillac model — is designed to support a variety of body styles.

GM and Ford declined to comment directly on how those plans will impact manufacturing, but officials at both automakers have said that those new vehicles would present new job opportunities.

"Employees have shared their concerns about fitting into an industry that is going to look and feel and operate much differently than it does today," GM CEO Mary Barra said in July at the official start to 2019 contract negotiations. "I understand that concern. Be assured that as we continue to make advancements, with new jobs and skill sets, we will still require a skilled and engaged workforce."

For most of the next decade, automakers will have a blended manufacturing process for electric vehicles and gasoline or hybrid vehicles, analysts believe. The more future-oriented vehicles likely will be produced in the same plants (sometimes on the same assembly lines when they are hybrid vehicles) as traditional cars and trucks with gasoline engines. That could add manufacturing jobs near-term. And the bodies of electric vehicles are largely assembled and painted in the same manner.

The bigger impact is expected to come at U.S. plants building engines and transmissions. Experts found the powertrain in the all-electric Chevrolet Bolt has 80% fewer moving parts than a comparable car with a gasoline engine. Tesla Inc. has said its drivetrain has fewer than 20 moving parts. Further, electric drivetrains are more suited to automated assembly lines.

"There's probably going to be a lot fewer people involved in assembly of motors and transmissions, said Abuelsamid.

Said Dziczek: "The existential threat is more on the powertrain facilities."

Some of those people might be retrained to build batteries or assemble electric drivetrains, said Abuelsamid. While the UAW is worried that automakers might continue to source batteries from outside the U.S. for those new vehicles, once Ford, GM and others start building more electric vehicles, the companies are likely to source or produce batteries in North America to support them, experts said.

That retraining isn't complex, Abuelsamid said. It's several years away, too. Navigant research doesn't expect electric vehicles to make up more than 15% of the market until 2030. It's not until roughly the 15% mark that electric-vehicle production begins to greatly affect manufacturing.

Still, not every engine or transmission worker will find a job working on EVs.

"A lot of those jobs in those areas are going to disappear," Abuelsamid said. "It's just the nature of the beast."

Twitter: @Ian_Thibodeau