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

Bain buying TI Automotive

January 27, 2015 8:49 am ET

After months of speculation, Auburn Hills, Mich.-based TI Automotive Ltd. entered into an agreement Tuesday to be acquired by private equity firm...    More

Image

Auto industry on the hunt for new lightweight materials

January 26, 2015 4:03 pm ET

The auto industry is focusing on lightweighting, and this is igniting a race to find new materials that can meet ever-changing performance needs of...    More

Image

Continental builds low-emission interior trim factory in China

January 26, 2015 12:33 pm ET

Benecke-Kaliko AG is making the largest investment in its history to build an environmentally friendly auto interior trim plant in China, prompted by ...    More

Image

Gurit wins carbon fiber auto contract using new processing technology

January 23, 2015 9:22 am ET

Switzerland-based composite materials group Gurit Holding AG has been selected as the supplier for carbon fiber based automotive body panels at a...    More

Image

ACC's 'Roadmap' gaining traction

January 22, 2015 1:56 pm ET

Nearly a year into the launch of the latest effort to promote greater use of plastics in automotive applications, a trade group behind the push says t...    More

Market Reports

Plastics in Automotive: Innovation & Emerging Trends

This special report newly released by PN and sponsored by The Conair Group examines current trends in the use of plastics in automotive, materials innovations and the changing landscape. It includes a review of legislative/regulatory activity impacting vehicle development and lightweighting, market opportunities & challenges for mold and toolmakers, innovative design strategies being implemented by major OEMs and suppliers, as well as a review of key indicators in Canada, Mexico, Brazil and China.

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

Injection Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Upcoming Plastics News Events

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

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

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

More Events