CEO Dialogue, Linda Hasenfratz – September 2021

To kick off our 2021/2022 season Linda Hasenfratz, CEO of Linamar Corporation, joined fellow OG100 members to speak to how Linamar is addressing the major challenges that are affecting numerous industries worldwide and asks us to use the term “unprecedented” carefully.

Based in Guelph, Ontario, Linamar Corporation is Canada’s second largest automobile parts manufacturer. Linamar manufactures and supplies automotive and industrial markets across the globe with numerous manufacturing centres across North America, Europe, and Asia. Linamar has more than 26,000 employees in 61 manufacturing locations, 8 R&D centers and 25 sales offices in 17 countries. As CEO of Linamar Corporation, Linda Hasenfratz has grown the company from an $800 million enterprise to a $7.6 billion diversified global advanced manufacturing company. 

The current labour shortage is a local, national and global issue. Job openings are at record highs. As many as 40% of employees expect to leave their current role in the next 3 – 6 months (McKinsey & Company, Sept 2021). Linamar is facing this challenge head on at their Guelph locations where they are looking to hire 1,000 employees. They are offering signing and referral bonuses in hopes of attracting top talent. But Linda notes aligning employee and employer values and needs is key to retaining staff and building a strong internal culture. As these challenging and uncertain times continue, employers will need to further embrace their role as leader of overall morale, supporting employees professionally and personally.

Auto-makers, who account for 6 – 7% of the chip market, made a strategic error when they walked away from their supply base for semiconductor chips. Some OEMs fared better than others but overall the industry is forecasting a total vehicle loss of 6.89 million light weight vehicles. Quarterly supply and volume predictions for 2021 have been highly inaccurate, only exacerbating the issue. Linda suggests it will be mid 2022 before this issue is resolved.

Similar to the chip industry, 2020 saw no new investment in capacity for the shipping industry. A shortage of shipping containers, imbalance globally of supply, labour shortages at ports and spike in consumer spending have all driven ocean freight costs up by up to 700% in the last 6 months. Linda is looking to February or March before there will be relief; driven in part by recent investment in containers.

So, is this all really as “unprecedented” as it looks? Linda points out that in 2010, we also saw dramatic shipping costs increase and chip shortages. Ultimately by staying flexible, identifying your risks and focusing on the big picture and long term, we can navigate murky waters and come out bigger and better. Like we’ve done before.