Dana CEO says purchasers are collaborating with suppliers earlier

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TRAVERSE CITY, Mich. -- Like other Tier 1 suppliers, Dana Holding Corp., a major supplier of axles and driveshafts, has been working to strip weight out of its products, says CEO Roger Wood. Meanwhile, he says that automakers are working earlier with suppliers on product development.

Wood spoke to Staff Reporter Larry P. Vellequette at the 2014 Management Briefing Seminars on Tuesday.

Where do you see the biggest opportunity for weight savings within your product range?

In our power technologies group, we have a number of different technologies for lightweighting that we’re working on -- plastic cam covers, for example, plastic oil pans -- products all geared toward maintaining the strength and durability of the product while taking a significant amount of weight off.

How far in advance does a supplier have to guess where the industry is going in order to be able to deliver what a customer will need?

Three years ago, we identified eight market value drivers -- fuel economy, emission reductions, cost of ownership, for example -- and we focus our engineering resources on those to make sure that our products meet one or more of those market drivers. I can’t tell you what vehicles are going to look like 30 years from now, but I can tell you that fuel economy and emissions reduction and cost of ownership aren’t going to change over that time.

Are you looking at exotic materials, such as magnesium, for example, for any of your core historic driveline products?

We’re developing better, more robust materials so that we can use them for lightweighting and not lose the strength of the product, but I wouldn’t say we’re using any nano-materials, or anything like that.

Have you seen any dramatic changes in the way that OEMs are doing their purchasing, in terms of how they’re treating suppliers?

Purchasing organizations are really making a concerted attempt to bring suppliers in earlier in the process. It’s a difficult process to do, because many times the OEMs don’t completely understand what it is that they want, and they’re trying to bring suppliers in as early as they possibly can. I think where they’re probably heading is for suppliers to come in early enough to help them understand what they want and be collaborative with them in developing that. That’s different than what it used to be only a few short years ago.

You can reach Larry P. Vellequette at lvellequette@crain.com.


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