Welcome to the Daily 5 report for Monday, Sept. 22.
Lucerne International Inc. CEO Mary Buchzeiger wanted to invest $50 million and create 325 jobs in Detroit at a new hot aluminum forging plant. The project would reshore jobs in Michigan from China.
But Buchzeiger, one of the 2020 Automotive News 100 Leading Women in the North American Auto Industry, is learning the hard way that such a project is easier said than done amid the U.S. tariff landscape and supply chain uncertainties.
Lucerne, which makes components for Stellantis, Rivian and large Tier 1 suppliers, is still committed to onshoring, Buchzeiger told Crain's Detroit Business, an affiliate of Automotive News. The aluminum forging project, however, is being pushed out further, scaled down and likely moved out of Michigan.
"It's everything converging at once," Buchzeiger told reporter Kurt Nagl. "You've got tariffs that are hitting our equipment costs. You've got tariffs that are hitting our raw material costs. You've got these questions over the Inflation Reduction Act. You've got the industry itself, where programs are being delayed or canceled, margins are being squeezed."
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Lucerne's aluminum parts project would seem to be exactly what the Trump administration wants to achieve from tariffs on China and other trading partners. But the tariffs are having the opposite effect, Buchzeiger told Nagl.
For a new factory, the supplier would have to import aluminum forging equipment from China, the only place it is produced, Nagl wrote. Tariffs on that equipment would cost the company an additional $2 million, the story says.
Ford Motor Co. is also familiar with the situation — the automaker is taking a big hit from tariff costs on equipment being imported from China for its battery plant in Marshall, Mich., Crain's reported.
Meanwhile, a couple potentially huge Stellantis stories broke today.
The automaker said it detected unauthorized access to a third-party service provider's platform that supports its North American customer service operations, Reuters reported. The breach exposed only basic contact information and did not involve financial details or sensitive personal data, Stellantis said.
The automaker also unveiled an EV prototype that features a faster-charging, lighter and more affordable battery that eliminates the need for a separate inverter and charger, Reuters reported.
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— Philip Nussel, online editor
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