Oh, the peril of being a company in a global economy" that has survived in part by virtue of its customers' "Buy American" attitude. Gneral Motors is clearly stating that it has no official plan to force suppliers to go to low-cost countries (LCC; also known by the euphemism "leading cost countries"), despite the fact that recent bid packages were accompanied by a list of "approved" countries. Suppliers were told that at least 30 percent of their content must come from such countries, regardless of cost. Needless to say, this has stirred up a bit of controversy in the auto industry.
Bo Anderson, GM's head of purchasing, claims that such bid packages were simply the result of a renegade employee, who earned praise for "creativity" and was not disciplined. The company immediately launched an investigation and issued a missive stating that it isn't the automaker's policy to direct suppliers where to do business. However, the General continues to emphasize the importance of a strong "global footprint" to its suppliers, and critics argue that GM is exerting pressure on suppliers to go overseas for cheaper production, with approximately 20 percent of North American automotive parts production going to LCCs by the end of the decade.
What do you think? Have your say in 'comments.'
[Source: The Detroit News]
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