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

Finalists named for 2014 SPE Automotive Innovation Awards

October 30, 2014 11:00 am ET

The Society of Plastics Engineers Automotive Division has selected finalists for its 2014 Automotive Innovation Awards competition. Category winners...    More

Auto supplier receiving grant to help expansion

October 30, 2014 3:35 pm ET

Summit Polymers is receiving an $800,000 performance based grant to help with a $7.3 million expansion of three of its Michigan facilities.    More

Image

Magna opens new exterior facility, plans for lighting investment

October 30, 2014 1:36 pm ET

Canadian automotive supplier Magna International Inc. on Oct. 28 opened a new injection molding and robotic paint line facility in Delta Township,...    More

Image

Detroit Manufacturing Systems to hire 200 for F-150 production

October 29, 2014 10:40 am ET

Interior trim supplier Detroit Manufacturing Systems LLC plans to hire 200 assembly workers by January to support production growth of Ford Motor Co....    More

Image

Automakers globally using 3-D printing to speed production, prototyping

October 27, 2014 11:41 am ET

As the cost declines and capabilities improve, automakers and suppliers increasingly are relying on 3-D printing to shorten product development cycles...    More

Market Reports

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 million dollar 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

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

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

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events