How will smaller suppliers keep up with demand?

TRAVERSE CITY, Mich. -- While many are asking how automakers will keep pace with new car demand, Kim Hill is asking the other half of that question: How will Tier 2 and Tier 3 suppliers keep up with rising automaker demand?

"We're looking at a once-in-a-lifetime opportunity," says Hill, director of sustainability and economic development strategies at the Center for Autmotive Research. "The auto companies want their suppliers to expand along with them -- but a lot of the smaller companies are gun-shy from the economic crash," Hill says.

"They need more assurance from their customers before they invest again."

Hill's group is trying to forge a support system of suppliers, community governments and financial lenders to help small suppliers invest. The group will meet at Traverse City late Wednesday afternoon.

"In a lot of cases, it's only a small investment -- maybe $500,000 -- that's holding a supplier back," he says. "We think local communities can step in and play a role with that."

You can reach Lindsay Chappell at lchappell@autonews.com

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