2025 Emissions and Fuel Economy Regulations Driving Automotive Innovation

Supplier at a recent OESA conference learn how new regulations are driving innovation throughout the supply chainMotor Equipment Manufacturers Association (MEMA) chief technology officer, Brian Dougherty, reports that U.S. vehicle makers and their suppliers are still a major part of the U.S. economy. According to Dougherty, automotive suppliers themselves account for 2.7% of U.S. employment (734,000 direct jobs and 3,600,000 total related jobs) and 2.3% of our Gross Domestic Product (GDP).

These significant numbers set the stage for Dougherty’s presentation at the recent Original Equipment Suppliers Association (OESA) and South Carolina Automotive Council (SCAC) South Carolina regional meeting at the Clemson University International Center for Automotive Research. In the rest of his comments about future trends and drivers in the automotive industry, he observed that the increases in federal regulations related to emissions and fuel economy for 2025 mean several things for OESA members and their supply chains.

Drivers for Innovation in the Automotive Industry

To significantly boost fleet fuel economy and reduce emissions, vehicle Original Equipment Manufacturers (OEMs) have an intense focus on light-weighting, the practice of innovating materials and designs, to reduce weight by several hundred pounds per vehicle. Powertrains will need to be smaller and leverage forms of electrification. Suspensions, structure and body panels will all need to shed many pounds.

Opportunities and Challenges for Suppliers at All Levels

  • High-tech component manufacturers will experience sales increases
  • Since the “low hanging fruit” in weight reduction has been picked, the next round of innovations in design will be more difficult for OEMs and suppliers alike
  • More engineering focus and effort will be required for new materials and joining processes
  • Therefore, the need for engineering talent is increasing dramatically

Suppliers Need To Be Strategic and Proactive

  1. Attract and hire engineers; do not coast
  2. Invest in product innovation and process automation
  3. Partner with regional universities and technology networks conducting research and developing technologies in new materials, design concepts, and advance manufacturing methods

As an engineer, program manager and executive who has seen manufacturers prosper and grow as well as some drift along doing what they have always done, it certainly appears that suppliers who conserve their valuable technical resources to focus on innovation have opportunities to become disruptors in this industry.

It is more important than ever to automate and integrate information flow to accelerate innovation and support creativity. This will enable key specialists and leaders to be efficient and effective by minimizing misunderstandings, distractions and treasure hunts for important data.

Ed Potoczak, IQMS Director of Industry Relations, has more than 30 years of experience in the manufacturing industry. Formerly an ERP consultant at the Oakstone Group and Plante Moran, Ed has also held positions as a senior systems engineer for Chrysler, technical sales leader in parts suppliers and general manager for a process equipment builder.