Auto suppliers gear up for hiring surge in 2013

Karl Henkel| The Detroit News

Auto parts suppliers are primed to boost jobs in 2013 in an effort to keep up with accelerating U.S. auto sales.

Suppliers invested heavily in their plants beginning in 2010, but delayed hiring until the automotive recovery was firmly under way. Now, they plan to expand their payrolls by tens of thousands of jobs.

About 476,000 people work for automotive parts suppliers in the U.S., and those companies are expected to add about 44,000 jobs this year, according to the Center for Automotive Research in Ann Arbor.

An additional 17,000 jobs are forecast between 2014 and 2016.

“We’ve seen the big capital investments, and productivity growing that way,” said Dave Andrea, senior vice president, industry analysis and economics of the Original Equipment Suppliers Association, from the floor of the North American International Auto Show on Wednesday.

“And now we will need to add additional people throughout the supply chain to keep pace with production.”

By the end of this year, the automotive supplier sector will employ a projected 520,000 workers in the U.S. That’s the first time supplier jobs will exceed 500,000 since 2008, according to the Bureau of Labor Statistics.

But it’s still significantly lower than the 733,600 the U.S. auto industry employed in 2002.

Sales in 2012 of cars and light trucks in the U.S. totaled nearly 14.5 million, the best since 2007. Industry analysts expect 2013 sales to reach 15 million — and perhaps rise as high as 16 million, according to the most optimistic forecasts.

The sales gains mean production will be near capacity for suppliers and manufacturers, and both will need to hire to meet the demand.

“If we do see an increase at a faster pace than projections, I think some suppliers — depending on the components they produce — could be in trouble,” said Anthony Pratt, R.L. Polk & Co.’s director of forecasting for the Americas, in a telephone interview.

Ford Motor Co., General Motors Co. and Chrysler Group LLC already have pledged to add thousands of hourly and salaried U.S. workers in the U.S. this year.

Suppliers aren’t far behind.

A survey by the Original Equipment Suppliers Association published this month found that 80 percent of suppliers, compared to 76 percent last year, are worried they will have to spend much more on overtime.

Just under three-fourths are concerned that they will have a shortage of skilled labor, compared to 59 percent in 2012; and 61 percent are concerned that their internal capacity won’t be enough, compared to 54 percent in the 2011 survey.

The concerns, however, are minimal compared to what suppliers had to deal with during the auto industry downturn, when half of the automotive industry’s Tier 1 suppliers were facing bankruptcy, according to global management consulting firm A.T. Kearney.

Some suppliers, including Japan’s Denso Corp., will invest additional capital to expand their ability to meet the needs of manufacturing partners. Denso announced this week $750 million in U.S. investments that will expand and create production lines.

“We wouldn’t be moving forward if we weren’t confident,” said Julie Kerr, senior manager of corporate communications at Denso, in an interview at the auto show.

khenkel@detnews.com

(313) 222-2504

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