Automotive in Israel - Review PDF
Automotive in Israel - Review PDF
Automotive in Israel - Review PDF
INDUSTRY
IN ISRAEL
TABLE OF CONTENTS
Defining the Automotive Industry 5
Segments 14
Footnotes 30
2016 | 3
DEFINING THE AUTOMOTIVE INDUSTRY
2016 | 5
SEGMENTATION OF THE
AUTOMOTIVE INDUSTRY
The automotive industry is often segmented for Tier 2 suppliers, such as steel sheets or
based on tiers. Automotive assembly is heating services.
considered the starting point, while all other
5. Tier 4 – Tier 4 suppliers provide basic raw
activities are described as "upstream" or
materials such as iron and glass to Tier 3
"downstream" from assembly, based on their suppliers. This tier is often included in the
chronological position before or after assembly Tier 3 category.
on the value chain. This segmentation includes
6. Downstream activities – Companies that
the following3:
are downstream on the value chain from
1. Original Equipment Manufacturers (OEMs) – OEMs and engage in the sale and distribution
Companies that manufacture or assemble of automobiles, and the provision of
the final product. Automobiles that are maintenance and repair services.
manufactured under a certain brand name
Certain companies may supply products for
may include parts manufactured by multiple
multiple tiers, depending on the companies
suppliers (e.g., tires, motor, brakes, etc.), but
for which they manufacture their products,
only the company that assembles the final
leading to their inclusion under two different
product is considered an OEM.
categories simultaneously (see illustration 1).
2. Tier 1 – Tier 1 suppliers manufacture
components used for final automotive
assembly. These suppliers work with OEMs
in order to manufacture parts (internal
or external) as needed. These parts can
be divided into two categories – Original
Equipment (OE), which is sold to the OEM
to be part of an entire automobile; and
Aftermarket/Secondary Market products,
which are either spare parts or accessories.
7
THE GLOBAL AUTOMOTIVE INDUSTRY
9
GLOBAL TRENDS
IN THE AUTOMOTIVE INDUSTRY
liquid hydrogen, and more. Vehicles that use (see Israeli smart transportation and fuel
11
GLOBAL TRENDS IN THE AUTOMOTIVE INDUSTRY
communicate with other nearby devices, support lane, or of their likelihood of colliding
advanced analyses, and more. Trends in this with another object, parking assistance,
field include: traffic light identification, and more.
1. Driver-assistance systems – Road There are other systems that improve the
accidents are a major cause of death in human-machine interface and attempt
industrialized countries, and the risk of to help drivers perform certain functions
vehicle collisions increases significantly without taking their eyes off of the road
when the driver's attention is distracted or hands off of the steering wheel. These
from the road for even two seconds – and interfaces are based on voice commands, eye
even while the driver is watching the movement detection, and pop-up displays.
road but is concentrating on other things. Systems of this kind are supported by the
Driver-assistance systems that incorporate regulators, and some (the more veteran
features such as sensors, cameras and systems) have become a mandatory part
warning devices alert the driver to potential of safety regulations in the automotive
threats on the road and facilitate certain market. Thus, in 2009, the EU required that
driving functions. These include systems Electronic Stabilization Programs (ESP) be
that alert drivers of deviations from their installed in all vehicles, and that advanced
13
THE AUTOMOTIVE INDUSTRY IN ISRAEL
Segments
The Israeli market consists of both veteran include forging, high-pressure ink injection,
companies that specialize in vehicle assembly metal injection, coating and reinforcement,
and Tier 1, 2 and 3 supply, engaging in traditional rubber injection, etc.
and advanced manufacturing processes, and
companies that specialize in innovation,
advanced technologies and facilitation of
The Israeli market consists of both
automotive manufacturing processes. veteran companies that specialize
in vehicle assembly, and companies
Vehicle assembly (OEM) and Tier that specialize in innovation, advanced
1, 2 and 3 supply technologies and facilitation of
1. There are several manufacturers in Israel automotive manufacturing processes.
that assemble the final automotive product.
These include buses, military vehicles and
others (trailers, containers, fire-extinguishing
Advanced technologies
vehicles, vehicle conversion).
(electronics, software, innovation
and driverassistance systems)
2. Tier 1 aftermarket suppliers: Over 60
Many Israeli companies develop aftermarket
Israeli companies manufacture aftermarket
systems and technological innovations related
products for the automotive industry. These
to driving and the automotive market. These
include spare parts and accessories such as
companies design, manufacture and supply
batteries, ventilation and airconditioning
diverse products including safety and driving
systems, fleet management systems, air
assistance systems, tracking technologies,
brake diaphragms, electric starters and
navigation and control systems, sensors, inter-
alternators, seals, thermostats, gears, gear
vehicle connectivity, cyber protection, voice
pumps, bearings and motor valves, filters
recognition and more.
and more.
Israeli smart
transportation and Smart transportation is the use of
alternative fuels different types of technology to
developments streamline travel, by making it shorter,
safer and cleaner.
Smart transportation
Smart transportation is the use of different types
Israeli smart transportation companies have
of technology to streamline travel, by making
become world-renowned for their achievements
in this field. These companies develop products
based on software innovation and cutting-edge
technologies, like products developed for the
automotive industry.
15
THE AUTOMOTIVE INDUSTRY IN ISRAEL
by Google. Following in its footsteps, many meetings with market leaders and investors,
other companies in the field are growing and and more.
establishing international partnerships. The companies that have joined the community
Israel is heading at high speed toward a include Elbit, Rafael, Phinergy, IAI, Mobileye,
promising future in the field. One example and international companies such as IBM and
is the establishment of the EcoMotion General Motors.18 When the community was
community, which encourages and initiates founded in 2013, there were approximately
activities related to smart transportation. The 70 Israeli startup companies developing smart
community was founded in cooperation with transportation innovations. As of mid-2016,
the Alternative Fuels Administration and other this number has jumped to over 300 startup
organizations, including the Israeli Innovation companies.19
Authority, Ministry of Science, United Israel
Appeal and NGOs, as well as leading figures Smart transportation is a rapidly growing
in the commercial and academic sectors. The
field in Israel, with the establishment of
community organizes conferences, professional
many new companies in recent years.
workshops, introduction to new technologies,
Alternative fuels
Recent years have shown a significant increase
in the development of fuel alternatives that
are more efficient and less pollutant than the
common oil-based fuels (diesel and petrol).
17
THE AUTOMOTIVE INDUSTRY IN ISRAEL
In May 2015, Raval received orders for parts acquired by Raval.38 Arkal has manufacturing
worth over €103 million from Volkswagen and sites in Israel, Germany, Spain, US, Poland,
Daimler Benz, as well as from Tier 1 suppliers France, Canada and China.39
that work with Fiat, Honda and BMW.32 In 2015, The company employs 200 people.40 As of
the company's total master agreement for 2014, Arkal exported products valued at NIS
2015-2030 was valued at over €1.1 billion , 33
288 million.41 The innovative skill developed at
Arkal for injection of thermoplastic, glass-filled
materials into molds has enabled the company
to manufacture strong plastic components
for leading automotive companies. These
components are adaptable and capable of
encompassing several small metal parts that
Plastic automotive components manufactured by Raval were originally installed separately into a single
21
SELECTED ISRAELI COMPANIES
Fund holds 63% of the company’s shares The company supplies standard and customized
since 2011. Tadir-Gan has approximately 629 thermoplastic materials that incorporate glass
employees in Israel, Germany and Poland. Its fibers, glass beads and mineral fillers. The
cumulative orders are valued at $1 billion (as compounds are fire-resistant, damage resistant,
of December 2015). Tadir-Gan specializes in heat and radiation stabilized, and can be
manufacturing automotive components using modified and customized.57
unique aluminum and magnesium alloys that
replace the iron and steel parts traditionally
used in the automotive industry. This reduces
the weight of the vehicles, conserves fuel and
MPE (Metalplast Engineering)
reduces pollutant emissions.52
The company develops unique parts that
integrate plastic and metal.58 The company
serves customers in various industries, including
the automotive industry, with customized
solutions, from the planning and design phase
[Upper oil pan manufactured by Tadir-Gan]
to manufacturing and supply.59 The company
is a Tier 1 and 2 supplier for large automotive
Polyram
companies, such as BMW, Volkswagen, Peugeot,
Polyram develops, manufactures and distributes and others.60 It was founded in 1999 as a
plastic raw materials and thermoplastic subsidiary of two long-standing companies
compounds for various industries, including the – Shiran Engineering (founded in 1986) and
automotive industry.53 The company is a Tier 1 Rimoni Industries (founded in 1954).61 In 2015,
and 2 supplier for large automotive companies the group (Rimoni, Shiran, MPE and subsidiaries)
and suppliers54, including Opel and BMW.55 Its employed 345 people and had revenues of
plant was founded in 1986 by families that live NIS 112 million.62 The company manufactures
in Ram On, an agricultural village. In 2015, 65% high-quality precision plastic components,
of the company’s shares were acquired by FIMI using sophisticated injection technology
Investment Fund. and advanced manufacturing processes. The
As of 2015, the plant employs 159 workers. In manufacturing process includes product
2014, company revenue was NIS 416 million injection, plastic products that incorporate metal
and net profits totaled NIS 41 million. 56
parts, printing on the product itself, and products
23
SELECTED ISRAELI COMPANIES
continue employing at least 159 employees is called EyeQ and it can detect whether the
at the Spectronix factory in Sderot, for 12 years driver is inside the lane or has swerved, assess
after signing the agreement. 73
In 2014 the the distance between the car and the one in
company employed 183 employees. In 2014,
74
front of it (triggering an alert if the vehicles are
the company’s revenue from military sales was too close), and more.77 Large companies, such
approximately $10.3 million.75 The company as Volvo, BMW, General Motors, Hyundai, and
develops advanced products with innovative others, have chosen to integrate this technology
features for the unique niche of military-use into their vehicles, and systems are sold to the
vehicles. The products must meet high standards, secondary market as well.78 The company was
which vary from one military organization or founded in 1999, and in 2014 it completed the
country to another. In addition, the company
largest stock market offering in Israeli history
is constantly developing new products. One
until that time, valued at $5.3 billion.79 In 2015,
example is a series of containers for rapid
the company employed 542 people and had
dispersal of fire-extinguishing powder, which
revenues of $241 million.80 Mobileye’s concept
are operated by a gas propellant/generator used
of integrated hardware and software systems
to extinguish fuel fires in seconds.76
is an innovative concept in the automotive
market. The company won several prestigious
Advanced technologies – international awards, including the International
electronics, software, Fleet Safety Award 2011, Red Herring Top
innovation, and driver- 100 Innovators, and Frost & Sullivan 2006
Entrepreneurial Company of the Year in the
assistance systems automotive category.81
Mobileye
Mobileye develops and manufactures advanced
driver assistance aftermarket products for
vehicles, such as road collision prevention
systems that are based on cameras with artificial
visual capabilities. The company's product Mobileye accident prevention system
25
SELECTED ISRAELI COMPANIES
Redbend
Redbend is a leader in the management of
MobiWize
firmware, applications and software for mobile
devices, connected devices and automotive The company’s software product generates
systems. The company enables efficient information for automotive systems based
management of over-the-air software updates on road conditions, in order to help conserve
for automotive entertainment and information fuel and offer other potential benefits.103 Its
systems, while guaranteeing the protection software uses data collected from various
and reliability of critical systems. 99 The sources, including crowd sourcing, sensors,
company provides holistic, secure management vehicle computers, special driver-vehicle-road
capabilities for software-based automotive layers, and more. The mapping system offers
systems, as well as for automakers (OEMs) and a wide range of opportunities for streamlining
Tier 1 suppliers. 100
Redbend was founded in automotive systems and fuel consumption,
1999, and in 2001 the company changed its improving driving performance, reporting excess
business focus and began to develop software weight on trucks, reducing pollutant emissions,
for the remote management of mobile devices increasing driving safety, and many other
such as tablets and smartphones. In 2010, possibilities.104 The company was founded in
the company expanded its business to the 2011 and employs 25–50 people.105 It markets
automotive industry. In 2015, Redbend was its product to the secondary market – both to
acquired by Herman, a US corporation that private vehicle owners and to fleet managers.106
manufactures entertainment and information
systems for vehicles.101 As of 2015, the company
employed 240 employees, mostly in Israel.
27
SELECTED ISRAELI COMPANIES
The company has developed one of the most and of providing information that is equivalent
popular navigation applications in the world. to high-density installation of sensors on the
The application is supported by smartphones, road. The information is provided to the driver
tablets and vehicle systems, and enables drivers in text format, a voice message and an accurate
to navigate the roads while receiving updates on map. The company employs 15-20 people.108
traffic congestion, traffic police, road accidents,
and more. This information is collected by other
application users who input information. The
company was founded in 2009, and over the Hi Park
course of several years it raised $67 million
The company was founded in 2013 and has
from various funds and investors. Waze was
developed a community application for mobile
acquired by Google in 2013 for $1.1 billion.107
phones (operated by placing the phone in the
car windshield) that detects and maps available
parking spaces while driving. This innovative
application identifies available parking spaces
Cellint via a camera, cross-checks the information
The company was founded in 2004 and with prior mapping data in order to determine
provides information on traffic congestion, using whether the parking space is legal, and uploads
information collected from anonymous mobile the information to a central database that can
phones. The company's unique, patent-protected be accessed by additional users. This application
location system anonymously monitors all can save time and hassle for its users, while
active mobile phones and detects their exact they search for a space to park on city streets.
location on the road or on a street once every As of 2014, the company employed 8 people.
30 seconds, on average. This information is The application was tested by taxi drivers in
analyzed using big data processing methods, and Tel Aviv and will soon be publicly available.109
1 ZEW, an independent, non-profit economic research center 26 Online Automotive News magazine, August 2015.
in Germany.
27 Jerusalem Post, January 2016.
2 United States Department of Labor.
28 Interview with Uri Pachter, Director of the International
3 ZEW, an independent, non-profit economic research center in Projects Department at the Export Institute, February 2016;
Germany; Houston Chronicle; Document published in 2010 Trade agreements from the Ministry of Economy website.
by the US International Trade Administration, page 6.
29 Review of Israel's automotive industry (2015), Israel Export
4 Israel Export Institute review of the Israeli automotive Institute.
industry, 2015.
30 Company presentation for the capital market.
5 McKinsey report on the global automotive industry – The
Road to 2020 and Beyond, page 3. 31 Company website; Article in The Marker, August 2014.
6 OECD review of the global automotive industry, 2013, page 7. 32 Article in The Marker, May 2015.
7 Website of the International Organization of Motor Vehicle 33 Company financial report for the third quarter of 2015, page 8.
Manufacturers (OICA). 34 Company presentation for the capital market.
8 http://www.oica.net/category/production-statistics/2015- 35 Review of Israel's automotive industry (2015), Israel Export
statistics/
Institute.
9 http://www.strategyand.pwc.com/perspectives/2016-auto-
36 Article in Calcalist, April 2011; Appeared in Bizportal, May
industry-trends; http://www.eulerhermes.com/mediacenter/
2015.
Lists/mediacenter-documents/Automotive-Global-Report.pdf
37 Article in Calcalist, April 2011.
10 Analysis of trends in the automotive industry from OECD-
Observer; Euro6 standards from the website of the European 38 Article in The Marker, December 2013.
Commission; CAFE standard from the US National Highway
Traffic Safety Administration (NHTSA). 39 Company website.
13 Published in MotorTrend, an online automotive magazine. 42 Review of Israel's automotive industry (2015), Israel Export
Institute.
14 Published on the Avent website; Published on the EU website.
43 Packer Steel website (former company owner).
15 Published on the Digital Trends website and on the US
government website. 44 Review of Israel's automotive industry (2015), Israel Export
Institute.
16 Various publications on the Security Innovation website.
45 Review of Israel's automotive industry (2015), Israel Export
17 Published on the Mordor Intelligence website. Institute; Company website.
18 YNET, November 2013. 46 Company website.
19 Publication on the Israeli Innovation Institute website. 47 Calcalist, September 2015.
20 Published on the Tel Aviv University website in October 2014. 48 Calcalist, July 2015.
21 Online pamphlet published by the Israel Fuel Choices Initiative 49 Company website.
Administration of the Prime Minister's Office; Times of Israel,
February 2015. 50 Company website.
22 Online pamphlet published by the Israel Fuel Choices Initiative 51 Review of Israel's automotive industry (2015), Israel Export
Administration of the Prime Minister's Office. Institute.
23 Jerusalem Post, September 2015. 52 Company presentation for the capital market, December 2014.
24 Times of Israel, February 2015. 53 Company website; Article in Calcalist, April 2015.
56 Article in Calcalist, April 2015. 86 Maayan Ventures financial report for 2014, page 21, 23.
57 Company website. 87 Maayan Ventures financial report for 2014, page 28; Chiportal
website, April 2015.
58 Review of Israel's automotive industry (2015), Israel Export
Institute. 88 Company website; Review of Israel's automotive industry
(2015), Israel Export Institute; Article in Walla, March 2015.
59 Company profile on EPICOS.
89 Company website; Article in The Marker, September 2015.
60 Company profile at the Export Institute.
90 Company website; Article in The Marker, September 2015.
61 Company website.
91 Article in Walla, March 2015.
62 Rimoni Industries report for 2012.
92 Article in The Marker, September 2015.
63 Rimoni Industries report for 2012.
93 Company website; Review of Israel's automotive industry
64 Company website. (2015), Israel Export Institute; Publication on the Ministry of
65 Review of Israel's automotive industry (2015), Israel Export Economy website, May 2015.
Institute; Article in Calcalist, August 2014. 94 Company presentation.
66 Article in Calcalist, August 2014. 95 Company LinkedIn profile.
67 Company website. 96 Company LinkedIn profile.
68 Article in Calcalist, August 2014. 97 Company presentation.
69 Company profile at the Export Institute. 98 Company LinkedIn profile.
70 Article in NRG, August 2015. 99 Review of Israel's automotive industry (2015), Israel Export
71 2014 annual report, page 4; Appeared in Chiportal, June 2015. Institute.
73 Appeared in Chiportal, June 2015; OS-Capital website, 101 Article in Globes, January 2015.
November 2010; ListofCompanies website. 102 Article in Globes, January 2015.
74 2014 annual report. 103 Review of Israel's automotive industry (2015), Israel Export
75 2014 annual report, page 39. Institute.
76 2014 annual report, page 36. 104 Company website; Document by the Export Institute on smart
transportation; company website page.
77 Company website; Review of Israel's automotive industry
(2015), Israel Export Institute. 105 Company LinkedIn profile.
79 Article in The Marker, August 2014. 107 Article in Globes, June 2013; Article in Globes, March 2016.
80 Mobileye 2015 annual report. 108 Article in YNET, February 2011; Information about the
company from the website of the Innovation Conference for
81 Company website. Smart Cities held in The Hague in February 2016; Company
LinkedIn profile.
82 Company website; Review of Israel's automotive industry
(2015), Israel Export Institute; Article in The Marker, 109 Article in Globes, July 2015; Article in Calcalist, September
November 2012. 2014; The Car online magazine, April 2015.
83 Company website; Report by the venture capital fund that
operates the incubator for the Israel Securities Authority.
31
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The information included in this guide is relevant for December 2016. The content included is intended
to provide only a general outline of the subjects covered and it is necessary that specific professional
advice be sought before any action is taken.