Auto Suppliers Under Pressure to Shift Production Abroad - aftermarketNews

Auto Suppliers Under Pressure to Shift Production Abroad

A new study soon to be released by the Society of Automotive Engineers (SAE) is showing that the pressure to move automotive manufacturing jobs abroad will continue, despite federal and local government efforts to maintain or increase industry employment levels in the U.S. The SAE will release the report at the 2004 SAE World Congress in Detroit next month. The study, which is still under development, will outline "best practices" for global automotive suppliers. The Odyssey study seeks to help suppliers understand how their global manufacturing operations will need to change and how best to make those changes to survive and thrive.

DETROIT — A new study soon to be released by the Society of Automotive Engineers (SAE) is showing that the pressure to move automotive manufacturing jobs abroad will continue, despite federal and local government efforts to maintain or increase industry employment levels in the U.S. The SAE will release the report at the 2004 SAE World Congress in Detroit next month.

The study — the Odyssey of the Auto Supplier Industry, which was conducted by Roland Berger Strategy Consultants in cooperation with the Original Equipment Suppliers Association (OESA) — will be the focus of a half-day seminar beginning in Cobo Center’s Riverfront Ballroom on Monday, March 8.

The study, which is still under development, will outline “best practices” for global automotive suppliers. The Odyssey study seeks to help suppliers understand how their global manufacturing operations will need to change and how best to make those changes to survive and thrive. In addition, the Roland Berger report will list tools, techniques and equations to evaluate where a supplier should be outsourcing or positioning its global resources.

“Nearly every supplier we’ve interviewed so far has indicated they are under increasing pressure to expand production outside North America,” said Wim van Acker, managing partner of Roland Berger’s U.S. operations. “This trend illustrates a critical need for suppliers, especially small and medium- sized companies, to develop a new set of manufacturing strategies.”

“Large suppliers are well aware of the pressing need to act, and they are actively pursuing opportunities abroad,” the Roland Berger executive says. “A preliminary finding of the Odyssey supplier report is that small and medium- sized suppliers will be impacted the most by these emerging changes. They will have to decide whether to move with their customers.”

The Roland Berger study will discuss trends in the global automotive supply chain; specific automotive component groups; which regions may win or lose, and what actually is driving the migration of automotive manufacturing jobs to locations outside of North America.

Dennis Cuneo, senior vice president, Toyota Motor Manufacturing North America, will be the keynote speaker at the March 8 SAE program. He will be joined in a discussion of the report by a panel that includes Timothy Jackson, senior vice president of Global Technology for Tenneco Automotive, and Hans Jehle, president of Mahle North America.

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