GM Targets Reduction in Suppliers to Cut Costs

General Motors Corp wants to reduce its number of suppliers to reduce costs, vice president of global purchasing Bo Andersson told Automotive News Europe. In the pre-release of the interview to appear in tomorrow's edition of the magazine, Andersson said: "Both our purchasing spending and our supplier base will shrink." To help cut costs and improve quality, the majority of GM parts will in the future come from "about 500 Tier 1 suppliers", Andersson said.

From AFX News Limited

FRANKFURT — General Motors Corp wants to reduce its number of suppliers to reduce costs, vice president of global purchasing Bo Andersson told Automotive News Europe.

In the pre-release of the interview to appear in tomorrow’s edition of the magazine, Andersson said: “Both our purchasing spending and our supplier base will shrink.” To help cut costs and improve quality, the majority of GM parts will in the future come from “about 500 Tier 1 suppliers”, Andersson said.

Tier 1 suppliers are those that deliver directly to GM.

Andersson also noted that the company has already cut its supplier base, although it is gaining new suppliers as well, most of which are privately owned Chinese companies.

Moreover, the purchasing focus will increasingly turn to emerging markets such as Ukraine, Poland and Bulgaria.

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