Brookings Report Provides Tennessee Roadmap For Automotive Manufacturing Growth

Friday, October 04, 2013

A report released Friday by the Brookings Institution’s Metropolitan Policy Program touts Tennessee’s automotive manufacturing industry as the “southern automotive powerhouse” and issues recommendations that could increase Tennessee’s competiveness in the global auto marketplace.

According to Brookings, Tennessee’s automotive is strong and could be even brighter if the state develops strategies to grow the supplier network, develop more high skilled workers, and foster a culture of innovation. Succeeding on these dimensions will ensure that the state remains a top choice for automotive industry expansion amid increasing competition in the global automotive market.

In its report, titled “Drive! Moving Tennessee’s Automotive Sector Up the Value Chain,” Brookings writes, “Tennessee has emerged as a southern automotive powerhouse. The state’s original underlying strengths—a strategic, low-cost location equipped with excellent transportation infrastructure—have been enhanced in the last decade and now position Tennessee quite well in the face of a number of disruptive megatrends that will alter the global industry. Despite growing domestic and international competition the state’s prospects are in fact bright.”

Brookings, the highly-respected research and policy organization, affirms Tennessee’s position as a leader in the North American automotive industry, including:

·         The state is  home to the largest auto industry in the South in terms of employment, and supply chain employment;

·         An industry profile with 650 automotive businesses (direct employment) including three original equipment manufacturers (OEMs) – Volkswagen, Nissan and General Motors;

·         More than 94,000 Tennesseans work in automotive manufacturing; 12,000 work directly for VW, Nissan and GM; and 82,000 more (78 percent of the industry) in the supply chain.

·         A network expanding across 75 of the state’s 95 counties.

·         An industry that accounts for more than one-third of all state manufacturing jobs;

·         The driving force of Tennessee’s recession recovery,   responsible for 12 percent of all job creation since 2008. From 2010 – 2012 employment increased by an average 16.1 percent compared to 1.8 percent for the overall economy.

“Our industry is a primary driver of Tennessee’s economy and a major contributor to prosperity and quality of life of our citizens,” said Tom Brewer, president of the Tennessee Automotive Manufacturers Association (TAMA).  “This success happened over a 30-year period due to strong leadership, policies and business-friendly fundamentals that have positioned Tennessee for an exceptional future as the headquarters of Southern automotive manufacturing.”

Brookings identifies three strategies designed to keep Tennessee on this path and propel the state forward:

·         Prioritize growth of the supplier marketplace by implementing policies that create avenues for exporting, reward research and development and improve access to capital for technology transfer and capital expenditures. The state should also play a role in encouraging suppliers to collaborate.

·         Lead the way in developing creative solutions to resolve the workforce challenges for large automakers and small and medium-sized companies. The report recommends a state-led effort that leverages its regional economic development zones to create training programs tailored to the automotive specialties in those regions.

·         Encourage innovation through research and development tax credits and facilitate collaboration between private industry and the state’s research institutions to help overcome competition from lower-cost countries and will move Tennessee from a primarily production location to a center of excellence for innovation and research and development

In addition to comprehensively analyzing the state’s automotive assets and opportunities, the report outlines a number of challenges that could threaten the state’s top position, including:

·         Cost pressures remain intense. Wages are converging across the United States and free-trade agreements make low-cost countries like Mexico attractive for new location decisions;

·         A shortage of skilled workers threatens expansion of existing firms;

·         Changing preferences of drivers and regulatory requirements will require automakers to develop and implement new technologies more quickly. Innovation and research and development expertise is needed at all levels of the supply chain, the report states.

The Brookings study recommends increased private and public sector support of a strong industry association to “market and advocate for the industry and facilitate networking, learning, and supply chain activities.”

“As the state’s leading automotive industry organization, TAMA is excited to support our state’s leaders as they take steps to drive Tennessee’s most important advanced industry forward,” said Mr. Brewer. 


Chattanooga Business Calendar Oct. 25 - Nov. 1

MO/27 Get a Job -- Tyner High School 10:17 a.m. to 3:55 p.m. Tyner High School: 6836 Tyner Rd. Get A Job instructs 10th graders on the finer points of interviewing skills, completing job applications, dressing for success and other topics of importance for the 21st century workforce.  Community volunteers are needed to assist with this event.  Please contact ... (click for more)

TEDxUTChattanooga Is Saturday - Participation Available Online

Registration for Chattanooga’s first TEDx event has closed, but people can still participate through the free online web stream on Saturday. Free viewing parties will be held in the Card and Benwood auditoriums of the UTC Engineering, Mathematics, and Computer Science Building (corner of Vine and Palmetto streets). Participants in the live event and the on-campus viewing parties ... (click for more)

Man Shot At Apartments On Tunnel Boulevard Wednesday Afternoon, Then 2 Juveniles Shot At Rec Center On Oakwood Drive With Suspects In Custody

Chattanooga police officers responded to the apartment buildings at 404 Tunnel Blvd. Wednesday at 1:21 p.m., where residents say they heard multiple shots fired.  Witnesses said they saw multiple suspects fleeing the scene on foot behind the complex.  The male victim was taken to a local hospital for life threatening gunshot wounds.  Later Wednesday, ... (click for more)

Several Arrested Outside Erlanger Hospital When Crowd Gathers After Woodlawn Shooting

Several people were arrested Monday night outside Erlanger Hospital after a crowd gathered and clashed with police. The crowd included family and friends of 20-year-old Apprentice Berry, who was shot multiple times and killed earlier Monday night at the Woodlawn Apartments on Wilson Street. Erlanger officials said the group gathered at the emergency room, but were later moved ... (click for more)

Chattanooga Has Lost Its Most Popular Citizen - Luther Masingill - And Response

Chattanooga has lost its most popular citizen – Luther Masingill. Although we are saddened we cherish the memories.  All of us have a Luther story.  Mine is the first time I met Luther.  This was before TV and all of Chattanooga listened to Luther on the radio.  I was 12-years-old.  Some of my buddies and I had gone to the State Theater in downtown ... (click for more)

Roy Exum: The Policeman’s Prayer

Every year, when the Law Enforcement Foundation of Greater Chattanooga holds its annual luncheon, it is one of the most heartening displays of what America really believes, down deep inside. The most prominent and influential leaders in the community – well over 1,000 -- gather to pay tribute and pledge their support to our heroes in blue who are unfaltering in their devotion, service ... (click for more)