Injection molder ADAC Plastics Inc. has joined a three-way partnership that will allow it to strengthen its capabilities at home and grow globally, without adding extra costs to its bottom line.
As part of the newly formed Vehicle Access Systems Technology Alliance, the Grand Rapids, Mich.-based auto supplier and its partners can tap into each others' expertise to bid on contracts at home, while taking part in a joint venture to expand production in emerging markets.
``We have the trifecta of business competencies,'' ADAC President Jim Teets said in a Feb. 23 telephone interview.
VAST Alliance combines the molding and painting capabilities of ADAC in North America, the electronics and locks production of Strattec Security Corp. and the European-focused molding and lock production of Witte Automotive to produce door lock and latch subassemblies.
Wittec and Strattec previously operated a joint venture, but with ADAC part of the mix in VAST, the companies have access to injection molding in both North America and Europe.
Each partner in the alliance retains the independence to continue its own operations, but can tap into the capabilities of the other firms.
They also have formed Vehicle Access Systems Technology LLC, a joint venture that will oversee manufacturing of their products in new markets like China and Brazil.
``The global automotive industry is going through a rapid change,'' said Vlad Hermann, VAST LLC president. The alliance addresses that fast-paced environment by providing the companies' combined resources to customers, he said.
That means ADAC could bid on a door lock module that combines its handles with mechanisms provided by partner Strattec - or Milwaukee-based Strattec could lead the bid process, relying on ADAC to provide the plastic parts. On that level, the relationship allows the molder to offer a more complete package to its North American customers, Teets said.
Or ADAC could use VAST Alliance to bid on contracts requiring production in North America and Europe - and rely on Witte to supply the plastics from one of its European operations; or, in turn, ADAC could supply Witte's plastics in the United States.
Teets said ADAC already has won door handle business with Honda through that overseas contact with Witte Automotive, a unit of Witte-Velbert GmbH & Co. KG of Velbert, Germany. And through the joint venture, all three firms have access to production in new markets, with VAST already operating plants in China and Brazil.
``We're quoting jobs now that we would have been shut out of if we were not a part of the VAST Alliance,'' Teets said.
ADAC executives knew they needed global production capacity to continue competing in the auto industry, he said. Entering the alliance allows ADAC to offer that manufacturing footprint to customers, while also securing jobs at home, he said.
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Vehicle Access Systems Technology Alliance
What each partner brings:
ADAC Plastics Inc.
Resources: Plastics injection molding and painting
Territories: North America
Strattec Security Corp.
Resources: Electronics and locks production
Territories: North America, Brazil, China*
Resources: Injection molding, painting and lock production
Territories: Europe, Brazil, China*
*Brazil and China operations run through existing Witte-Strattec venture