Collaboration isn't just a friendly word to toss around at auto industry functions, insist suppliers and consultants. It's about dollars and cents.
In one case, toolmaker Paragon Die and Engineering Co. could have cut $300,000 from the cost of a fascia mold, if it only had been given earlier input.
``It's very important that we get detailed, upfront information,'' David Muir, vice president of the Grand Rapids, Mich.-based mold maker, said Aug. 2 at the auto industry's Management Briefing Seminars in Traverse City. ``Working together, narrowing this information down, nailing down the specs, we can really help.''
The fascia mold - which Paragon bid on just days ago - is an extreme example, he said, with an engineering issue that could have been solved earlier to save big cash. Toolmakers can provide cost-savings input in many cases.
``The reality is, we can drive costs down,'' Muir said. ``We want a sustainable industry. We want sustainable customers.''
That cooperative approach rarely happens. Instead, the standard procedure sees financing requirements trickling down the supply chain. A toolmaker that completes a mold this year for a multibillion-dollar automaker may not see final payment for two years, he said.
To survive, toolmakers are improving in-house capabilities and speeding production and delivery.
Paragon, for instance, also has boosted its bottom line by diversifying, adding capabilities in compression mold tooling during the past four years. Compression molds now make up about a quarter of its business. The company also uses its 3,000-ton press for prototypes and short-run production.
The new business has allowed the firm to add 12 employees during the past year, bringing its total to 160 people.
Collaboration even has its place among competitors, he said.
Paragon is part of the United Tooling Coalition, a 17-member group of die makers, injection molding toolmakers and tooling equipment suppliers that has formed to offer one-stop bidding capabilities to the auto industry.
With the Ann Arbor, Mich.-based Center for Automotive Research serving as an independent agency overseeing the bidding process, the coalition can offer the auto industry one single face for an entire package of tools.
Each member prepares a bid on its particular specialty, which for Paragon is injection molds for large parts. CAR then presents a united bid on UTC's behalf.
``True collaboration hasn't happened yet in this industry,'' said Mike Powers, executive director of new business development for Dow Chemical Co.'s Dow Automotive unit in Auburn Hills, Mich.
For its part, the plastics industry is taking steps to improve cooperation between processors and suppliers, as well as other material groups. There are good reasons for the Washington-based American Plastics Council to work with the Auto and Steel Partnership to help the entire industry, Powers said.
``Most of the time [automakers] aren't looking at a 100 percent plastic solution or a 100 percent steel solution,'' Powers said. ``They want a total solution.''