Automotive News - December 1, 2008 - (Page 40) 40 • DECEMBER 1, 2008 GM’s Andersson: Suppliers aren’t demanding cash Push for speedy payment would intensify cash burn Robert Sherefkin rsherefkin@crain.com DETROIT — General Motors’ purchasing chief says his suppliers are not demanding shorter payment terms or cash on delivery in light of the automaker’s shaky finances. “Our suppliers are behind us,” Bo Andersson, GM group vice president for purchasing and supply chain, told Automotive News. Bo Andersson: “Our suppliers are behind us.” Andersson concedes that CEOs of supplier companies face difficult conversations with their nervous directors, who worry about GM’s ability to pay as it suffers a liquidity squeeze and seeks financial aid from Congress. A demand for shorter or COD terms would worsen GM’s disastrous cash burn. But GM is not facing new demands from suppliers, Andersson said. “We keep our terms of payments,” he said. “They are contractual, something we negotiate with suppliers, and we think it is important to be a prompt payer. We are doing our best to hold the current terms.” GM payment terms range from 35 to 45 days. Small to mid-sized suppliers cannot afford extended terms for fear of defaulting on payment to their suppliers. Any change in payment terms involving small-to-medium suppliers will trigger bank concerns that their clients may be encountering liquidity problems. Andersson said he is in regular communication with all GM suppliers. “It is very important to be very transparent and be open about the changes we see in the workplace with production schedules, product delay and any product changeovers,” he said. “We try to keep our production schedules as level as we can. We try to work with suppliers to address the cost situation.” Andersson said the supply base has continued to work hard with GM purchasing to cut costs. GM shares half of its suppliers’ annual savings. Last year that amounted to about $2 billion. Said Andersson: “If you look at supplier performance from our supply base this year, we have very good performance. We can say that before steel and raw material increases we were roughly running at the same performance as last year” in terms of productivity. c October sales plunge 14.3% in Mexico MEXICO CITY — Mexico’s dealers sold 83,277 new vehicles in October, down 14.3 percent from October 2007. It was the worst tumble for domestic sales in a decade. The last time year-over-year sales fell more was in October 1998, when they dropped 14.9 percent. Through the first 10 months, vehicle sales fell 3.4 percent from a year earlier to 845,644. General Motors was the leader in October. Its sales fell 17.0 percent to 18,045. No. 2 was Nissan Motor Co. with sales of 17,017, down 4.8 percent. Volkswagen AG was third in Mexico in October, with sales sliding 14.5 percent to 11,301. Ford Motor Co.’s sales dropped 20.1 percent to 10,050, while Chrysler LLC’s sales slipped 15.6 percent to 9,664. Imported vehicles bore the brunt of the sales decline. Sales of Mexican-made vehicles rose 5.3 percent in October to 37,783. But sales of imported cars and trucks tumbled 25.7 percent to 45,494. — Stephen Downer Mexico vehicle sales, October & 10 months Oct. 2008 Oct. 2007 10 mos. 2008 10 mos. 2007 ® PurigeN98 tire inflation pumps 98% pure nitrogen into your customers’ tires while pumping more profits into your business. Car Import truck BMW Car Truck CHRYSLER LLC† Mercedes-Benz import car Mercedes-Benz import truck Smart import car DAIMLER AG† FERRARI import car* Fiat import car Fiat import truck FIAT AUTO S.p.A. Ford car Ford truck Jaguar import car†† Land Rover import truck†† .. Volvo import car Volvo import truck FORD Car Truck GENERAL MOTORS Car Truck HONDA ISUZU (Import truck) Import car Import truck MAZDA Import car Import truck MITSUBISHI Car Truck NISSAN Import car Import truck PEUGEOT Import car Import truck PORSCHE Car Import truck RENAULT Import car Import truck SUBARU Import car Import truck SUZUKI Jaguar car Land Rover truck TATA†† Import car Import truck TOYOTA Audi import car Audi import truck Bentley import car Seat import car Seat import truck VW car VW import truck VOLKSWAGEN 492 72 564 2,877 6,787 9,664 249 214 50 513 2 85 71 156 2,295 7,673 – – 64 18 10,050 10,850 7,195 18,045 2,445 2,254 4,699 18 1,212 782 1,994 521 1,000 1,521 11,121 5,896 17,017 551 136 687 24 30 54 1,015 319 1,334 54 13 67 483 359 842 12 59 71 2,327 2,351 4,678 391 39 – 1,002 – 8,799 1,070 11,301 589 202 791 3,404 8,045 11,449 480 288 64 832 1 205 92 297 3,120 9,089 20 101 186 63 12,579 13,043 8,701 21,744 2,828 2,430 5,258 – 734 798 1,532 692 817 1,509 11,860 6,012 17,872 890 132 1,022 37 48 85 1,473 431 1,904 57 27 84 196 310 506 – – – 2,629 3,860 6,489 384 69 3 1,193 – 10,318 1,247 13,214 5,791 1,750 7,541 34,161 63,383 97,544 3,856 2,199 596 6,651 20 1,772 940 2,712 26,658 79,117 102 364 1,222 371 107,834 109,464 67,534 176,998 24,590 21,054 45,644 717 9,065 8,234 17,299 4,923 8,964 13,887 111,465 64,449 175,914 6,612 1,436 8,048 254 356 610 10,523 2,779 13,302 675 206 881 3,914 2,706 6,620 100 259 359 24,854 26,338 51,192 3,643 540 16 10,393 4 88,105 9,170 111,871 5,743 1,861 7,604 36,904 63,543 100,447 3,743 2,403 409 6,555 10 2,035 572 2,607 38,404 86,074 171 724 1,648 691 127,712 112,704 71,505 184,209 20,770 21,465 42,235 – 6,572 6,502 13,074 6,993 6,587 13,580 113,730 57,098 170,828 10,062 1,472 11,534 284 352 636 11,952 3,073 15,025 345 187 532 1,718 2,745 4,463 – – – 23,580 27,070 50,650 3,339 598 22 12,778 22 96,878 10,506 124,143 Domestic car Import car Total car Domestic truck Import truck 25,221 21,700 46,921 12,562 23,794 25,224 29,182 54,406 10,674 32,088 223,642 259,132 482,774 114,864 248,006 238,514 272,280 510,794 82,122 282,928 The likeness of Jeff Gordon and other related trademarks and copyrights are used with the permission of Jeff Gordon, Inc. Total truck Total domestic Total import TOTAL MEXICO SALES 36,356 37,783 45,494 83,277 42,762 35,898 61,270 97,168 362,870 338,506 507,138 845,644 365,050 320,636 555,208 875,844 †DaimlerChrysler sold the Chrysler group on Aug. 3, 2007; Chrysler LLC and Daimler AG totals through July 2007 are extracted from DaimlerChrysler. *Estimate ††Ford Motor Co. sold Jaguar and Land Rover to Tata Motors on June 2, 2008; Jaguar's and Land Rover's sales are included in Ford Motor Co. totals through May 2008. Source: Automotive News Data Center and Mexican Automotive Manufacturers Association http://www.actionim.com http://www.actionim.com http://www.purigen98.com/an http://www.purigen98.com/an
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