Lutz: GM played hardball with suppliers

Published: May 14, 2012 6:00 am ET

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Topics Automotive

TROY, MICH. (May 14, 4 p.m. ET) — Suppliers need a champion at General Motors Co., says Bob Lutz. And he says he tried to play that role, with mixed success.

During the recent Automotive Industry Action Group conference in Troy, Lutz said he tried to coax former GM CEO Rick Wagoner and purchasing chief Bo Andersson to foster long-term relationships with suppliers.

Lutz, who left GM in 2010, said he didn’t have much success. Andersson encouraged bidding competitions among suppliers to extract the lowest possible price, Lutz said — a tactic that actually drove up component costs in the long run.

“According to that view, automakers are the aristocrats living on top of the hill in a castle,” Lutz said. “And the suppliers are the serfs, taking their products up the hill in carts.”

GM’s current purchasing chief, Bob Socia, has quietly repaired relations with suppliers, Lutz said. “It has to be a relationship of equals.”


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Lutz: GM played hardball with suppliers

Published: May 14, 2012 6:00 am ET

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