North American tooling demands growing from foreign automakers

TRAVERSE CITY, Mich. -- As North American production rises, Asian and European automakers are asking their tool-and-die suppliers to set up shop in North America, a consultant says.

Laurie Harbour, president of Harbour Results Inc., a suburban Detroit consultancy, says annual demand for tooling in North America will total about $16 billion in 2018, up from $10 billion this year.

Local tool-and-die makers don't have the capacity to meet that demand, so German and Asia automakers are asking their own toolmakers to move to North America.

"They want them in the South close to their plants in Alabama or Spartanburg," said Harbour, who was attending the 2014 Management Briefing Seminars here. Mercedes has an assembly plant in Vance, Ala., while BMW has a plant in Spartanburg, S.C.

Harbour declined to identify European or Asian tooling suppliers that are moving to North America. But she did note that at least one of those companies will be a Chinese firm that plans to set up shop in Alabama.

In the meantime, Harbour fears that over-burdened tool-and-die makers could become an industry bottleneck. Part of the problem is the growing complexity of vehicles.

The number of tools per vehicle went up 20 percent from 2000 to 2013, Harbour said. "We expect them to go up another 25 percent by 2020."

You can reach David Sedgwick at dsedgwick@crain.com

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