Category: Suppliers

By Robert Farago on August 12, 2009

After our post on the “1000-DAY BIG THREE PLAN” to save the domestic automakers, TTAC commentators have been wondering about the man behind the website supportthebigthree.com. I’ve just got off the blower with site founder Sid Taylor who, it turns out, is the CEO of an automotive supplier named Set Enterprises. Scanning the site, it turns out the campaigner who would have Americans buy only Chrysler, Ford and GM products has a contract with Toyota. When asked about the apparent contradiction, Mr. Turner said the money involved is so small as to render the contract meaningless. “If I didn’t have Toyota it wouldn’t have any impact on my business.” Besides . . .

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By Edward Niedermeyer on July 13, 2009

While GM touts its less-than-revolutionary “interbuildability” scheme, Ford is approaching global product rationalization from another direction: on the backs of suppliers. Automotive News [sub] reports that Ford is requesting that its suppliers turn over component information to other firms if they are unable to supply a given assembly plant. These so-called “transfer agreements” involve handing over specs and technical drawings to other suppliers, which would then assemble the parts designed by the original supplier. Ford’s supply firms are understandably nervous about the initiative, arguing that it would allow Ford to use competition to squeeze suppliers on price. Also, the possible transfers to overseas firms could allow them to remarket the original suppliers’ designs and other intellectual property to other firms.

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By Bertel Schmitt on July 12, 2009

The situation in the collapsing French parts industry is turning explosive—literally. Workers at bankrupt French car parts maker New Fabris threaten to blow up their factory if they do not receive money from Renault and Peugeot, Reuters reports. The workers are occupying the New Fabris factory at Chatellerault, near Poitiers in central France.

Their ultimatum: Renault and PSA had better pay €30,000 ($41,800) to each of the 336 laid-off workers at the factory, a total of around €10 million. If they pay, they get the remaining stock of parts and the tooling. If not . . .

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By Edward Niedermeyer on July 6, 2009

Cars.com tackles the tough question of domestic content in its latest “American Made Index,” and comes away with a surprising result: Toyota’s Camry is the most “American” car on the market. Of course, making these distinctions in a global industry is fraught with difficulty. Though percentage of domestic parts content is tracked by the NHTSA for American Automobile Labeling Act compliance (PDF), those numbers count US and Canadian parts as being “domestic”. So Cars.com has created its own list which requires US assembly, at least 75 percent US-sourced parts content, and factors in sales numbers because “they correlate to the number of U.S. autoworkers employed to build any given model and to build the parts that go into those same cars.” Taking out vehicles that are being canceled with no clear replacement, the following vehicles make up their top ten “most American” automobiles.

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By Edward Niedermeyer on July 2, 2009

Consumers have a hard enough time keeping all the brands and nameplates in the US market straight; trying to keep track of the myriad suppliers that make up the bulk of the industry is nearly impossible. Even here on TTAC, our well-informed commentariat often throws up its hands at the first sign of supplier coverage. But the fortunes of suppliers to US auto firms have been fading for years now, as Detroit’s misery slides downhill through the various tiers of suppliers. And despite repeated calls for a supplier bailout (and their use as OEM bailout bait), aid has been either misappropriated or rejected. And the bankruptcies show no signs of slowing.

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By Edward Niedermeyer on June 17, 2009

Ford CEO Alan Mulally, speaking at the Detroit Economic Club’s National Summit, expressed his concerns about the health of the auto industry’s supplier base. “The most important thing that we do now is help them consolidate because we have this overcapacity,” Mulally is quoted as saying in Automotive News [sub]. “Everybody is going to be really careful that we do that and that we don’t topple the supply base.” Too bad the White House doesn’t agree, and suppliers have been screwed over since the bailouts began. Mulally also admitted that US automakers have a long way to go in convincing Americans of the value of their businesses. “Some things have happened, disappointed a lot of people, but we’ve got to really polish the value of what business brings to mankind,” he said. “We’re fighting for the soul of design and manufacturing in the United States.”

By Edward Niedermeyer on June 16, 2009

The WSJ reports that the Treasury has turned down an $8-$10 billion request by the OEM Supplier Association for aid to struggling auto supply firms. Department of The Treasury spokesfolks refuse to shed any light on the issue, but OEMSA President Neil De Koker tells the WSJ that PTFOA member Ron Bloom spiked the request because “they felt that unless we see chaos or a disorderly situation arising where have assembly-line shutdown due to lack of ability to get parts or stuff like that, then we would relook at this sitation, but that at the present time we believe everything is working.” The Journal goes as far as to credit this with decision with signaling “that the Obama administration wants to draw the line on how much taxpayer money it will spend on the U.S. auto industry.” That, or they know that supplier bankruptcies have been part and parcel of the US car biz for years now, and they’re keeping the powder dry for future OEM requests.

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By Edward Niedermeyer on June 15, 2009

Speaking at the Automotive News [sub] Manufacturing Conference, GM global manufacturing and labor relations honcho Gary Cowger (remember him?) had a “by Jove, we’ve got it!” moment that placed him in instant contention for the “Minimum” prefix recently vacated by Chrysler’s Bob Nardelli. Even the hosting publication couldn’t keep the scorn from dripping off its nut graph. “General Motors thinks it has created a method to build small vehicles profitably in North America and calls it interbuildability. Competitors know the concept as standardization.” Can you feel the love (in the air tonight)?

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By Edward Niedermeyer on June 9, 2009

The Original Equipment Suppliers Association is requesting an additional $8-$10 billion in TARP money, reports Automotive News [sub]. Because the first round worked so well. But two factors nearly guarantee that the request will be approved: first, the recent announcement that ten banks will be able to pay back some $68 billion in TARP money and second, the forthcoming resumption of production at GM and Chrysler when they emerge from bankruptcy. Oh yeah, and the fact that practically no TARP requests have been denied so far.

By Edward Niedermeyer on June 1, 2009

The Detroit Free Press is reporting that GM supplier Delphi will emerge from its three-year bankruptcy by selling itself to L.A.-based private equity firm Platinum Equity, for $3.6 billion. The bad news? Delphi will terminate its salaried pension plan, which covers 20,000 workers and retirees.The Pension Benefit Guaranty Corp will take over Delphi’s pensions, a move which will “cap the annual payments to $54,000 a year for salaried retirees age 65 years or older.” Delphi’s hourly retirement fund “will be addressed by GM.” Or not. Whichever.

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