| 5:06 PM EST

Tool and Die Sales Set to Plunge 24% in U.S.

Carmakers, who spent $8.7 billion on production tooling in North America this year, are likely to cut their investment to $6.8 billion in 2020 and $7.1 billion in 2021, predicts Harbour Results Inc.

Share

Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

Carmakers, who spent $8.7 billion on production tooling in North America this year, are likely to cut their investment to $6.8 billion in 2020 and $7.1 billion in 2021, predicts Harbour Results Inc.

CEO Laurie Harbour (pictured) attributes next year’s decline to a downturn in new-model programs being launched in the region. She notes that only 13 of the 45 scheduled new models in 2020 involve the traditional Detroit Three producers, who buy most of their manufacturing tooling locally.

Harbour says the expected gradual decline in North American car sales over the next several years will pressure carmakers to share platforms across more models, simplify trim packages and take other cut-cutting steps—all of which will reduce the need for tooling. She notes that competition from low-cost foreign suppliers, especially in China, also is hitting North American tool and die shops hard.

Harbour predicts that average annual spending on automotive tooling in North American will drop from about $9 billion over the past several years to between $6.5 billion and $8 billion through the next 3-5 years. Harbour says the downward trend already has forced at least 10 tool and die shops to close this year.

RELATED CONTENT

  • Designing the 2019 Ram 1500

    Ram Truck chief exterior designer Joe Dehner talks about how they’ve developed the all-new pickup. “We’ve been building trucks for over 100 years,” he says. “Best I could come up with is that this is our 15th-generation truck.”  

  • Truck vs. Truck; Steel vs. Aluminum

    According to Sandor Piszar, Chevrolet truck marketing director, “We engineer and build our trucks with customers’ expectations in mind.”

  • Insight: The Toyota Product Development System’s Implementation Challenges

    For conducting business in the U.S. market, Toyota has historically had several separate business entities: a sales and distribution company headquartered in California (Toyota Motor Sales, USA); manufacturing operations (Toyota Motor Manufacturing North America); a racing subsidiary (Toyota Racing Development, USA); the Toyota Technical Center for R&D in Ann Arbor; and a design facility in California (Calty Design Research, Inc.). On April 1, 2006, Toyota merged its R&D operations and its manufacturing operations into a single company.