Ford Enacts Supplier Reforms

by Edward Niedermeyer

Published: October 2nd, 2008

While Chrysler plays hardball with its suppliers, Ford is reforming its supplier relations by sharing technology and standardizing components. Automotive News (sub) reports that Ford will share a variety of its intellectual property with minority-owned suppliers in hopes of developing new products and commercial uses for them. Among the first suppliers to receive assistance in the Joint Technology Framework are Dakkota Integrated Systems, Flex-N-Gate, Gonzalez Production Systems, Grupo Antolin Wayne and Prime Wheel. “We need to support our minority- and women-owned suppliers in moving toward a business model that competes on technology, in addition to cost,” said Tony Brown, Ford VP for global purchasing. The program aims to allow those suppliers “to attract the engineering talent and new sources of capital to migrate these technologies to the next level.” Ford is also attempting to standardize European and American products by sharing as many components across markets as possible. The forthcoming US-market Fiesta will share 78 percent of its parts with its European cousin, while the US Focus will share 90 percent of its parts with the Euro model. Unifying product strategies helps Ford not rely on the approved $25b bailout loans, says Brown. “Our product plans are funded,” Brown tells Automotive News (sub). “None of Ford’s product plans hinge on it.”

Edward Niedermeyer

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4 of 14 comments

John Horner on Oct 02, 2008

hitman1970 has a point. The 2.8 have pulled out of so many business areas it is a surprise they have any left sometimes. Dodge Power Wagons used to be ubiquitous in military service.

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TexN on Oct 03, 2008

John Horner: "skin color or plumbing". Brilliant! The list of things that our government classifies as worthy of tracking and rewarding is staggering. How about "cost effective and appropriate"? Nah. Especially not in an election year.........

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ZoomZoom on Oct 03, 2008
“We need to support our minority- and women-owned suppliers in moving toward a business model that competes on technology, in addition to cost,” said Tony Brown, Ford VP for global purchasing. The boldfaced text above is key. Am I the only one who keyed on this? "in ADDITION to cost", as in "ADDITIONAL cost." It sure sounds to me as if they are seeking additional cost. And yes, who would want to pursue government contracts? I worked for an aerospace defense contractor years ago, long before Sarbanes-Oxley and ISO 9000. We made water hoses for cars, trucks, tanks, and helicopters. The hoses were typically transported by truck or train on giant reels. But any hoses destined for a government customer were not allowed to be wound onto reels. There was no valid technical reason for this. It did not result in a shorter life expectancy for our products, yet we had no choice; this was written into all of our government contracts. So we had to employ longer trucks or rail cars for these products. It raised our cost, which of course, we always passed on to the customer. That's you, you, and you, taxpayers! Today, companies have hundreds of similar useless regulations that they have to follow. If I ran a company, I would probably seek to AVOID interaction with government customers. A lot of companies feel the same way. Too much regulation, too much effort must be spent in "contract breach avoidance" efforts.

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Jimmy2x on Oct 03, 2008

Ford like other large companies has no choice but to emphasize minority/women owned companies or they will have the Feds on their back. If you look at all the boilerplate crap on ANY contract with a large company you will find this crap.

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