Chrysler: No minority buying, no bids

Larry P. Vellequette
AUTOMOTIVE NEWS

Published: May 6, 2013 9:22 pm ET
Updated: May 6, 2013 9:25 pm ET

Related to this story

Topics Automotive

DETROIT -- Chrysler Group is serious about spending more with minority-owned suppliers and has penalized four Tier 1s that aren't following its lead.

The four lost the ability, at least temporarily, to bid on future contracts. Chrysler wouldn't name them or say if they have improved enough to resume bidding.

Chrysler's Tier 1 suppliers in the Supplier Diversity High Focus program boosted their purchases from Tier 2 minority- or women-owned suppliers from $170 million in 2010 to more than $700 million last year, Chrysler said.

Also, more than 17 percent of the $26 billion of Chrysler's total purchases in North America last year were directly or indirectly from minority or women-owned businesses.

"We think at this point that it has been extremely successful," said Kevin Bell, Chrysler's senior manager for diversity supplier development, speaking of the minority-supplier program.

Chrysler scores all suppliers annually on their "minority sourcing performance," gauging how much business they do with companies owned by women and members of minority groups.

The minority sourcing score normally represents 5 percent of the Tier 1's overall score with Chrysler, which helps determine whether a purchase contract is signed. But if the Tier 1 has less than 1 percent of its purchases from minority- or women-owned suppliers, the importance of its minority sourcing score grows fourfold. The added weight can hamper significantly a supplier's ability to win bids.

Bell said about 65 percent of 134 of Chrysler's Tier 1 suppliers that entered the Supplier Diversity High Focus program in 2010 have "graduated" by increasing their purchasing from minority-owned businesses to goals that vary based on their business segments. Chrysler continues to work with 59 suppliers that have either recently entered the program, remain there or have not made progress, he said.

In the last year, Chrysler temporarily excluded four Tier 1 suppliers from bidding on future programs because they had failed to raise their percentage of purchases from minority-owned suppliers, Bell said. He said the lost bidding potential caught the attention of top managers at those suppliers.

Bell said, "You can see that some companies were dragging their feet."

This story originally appeared on www.autonews.com.


Comments

Chrysler: No minority buying, no bids

Larry P. Vellequette
AUTOMOTIVE NEWS

Published: May 6, 2013 9:22 pm ET
Updated: May 6, 2013 9:25 pm ET

Post Your Comments


Back to story


More stories

Image

Toyota says Mirai fuel cell sedan represents a 'new start' for the carmaker

March 2, 2015 11:55 am ET

Toyota Motor Corp.'s most advanced vehicle, a car that runs on hydrogen and emits only water, has had an ironically low-tech birth and has an equally ...    More

Image

Plastic Omnium makes China investment push

February 26, 2015 4:35 pm ET

Three of the six new plants that automotive molder Plastic Omnium SA plans this year will be in China, part of a broader push it’s making in...    More

Image

Jagemann expands to meet rising demand from auto industry

February 18, 2015 2:50 pm ET

Jagemann Precision Plastics is expanding its Murfreesboro, Tenn., plant to meet rising demand for insert-molded parts.    More

Image

TransNav, Rompa Group form JV covering Europe, North America

February 17, 2015 5:28 pm ET

TransNav Inc, of New Baltimore, Mich., and the Tilburg, Netherlands-based Rompa Group have established an injection molding and thermoforming joint...    More

Image

Plastics firms honored for work in product development, manufacturing

February 17, 2015 4:09 pm ET

Sealpac USA LLC, Dow Chemical Co.'s automotive systems group, Piper Plastics Inc. and Igus Inc. were honored for their efforts in the development new ...    More

Market Reports

Flexible Packaging Trends in North America

North America represents about 30 percent of the global consumption of flexible packaging. Annual growth in this region is forecast at 4 percent during the next 5 years.

For more insight on growth opportunities, drivers of growth and the outlook for 2015, download this report.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 billion plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events