DETROIT -- Ford Motor Co.'s bid to cut costs by sharing savings with suppliers isn't paying off as quickly as the automaker envisioned.
Though some savings have been realized, the program isn't meeting goals Ford set when it was introduced in January, said Tony Brown, Ford's global purchasing chief, in an interview with Automotive News.
"Some of it is internal. Some of it is getting the logistics of suppliers lined up and understanding what the real possibilities are and figuring out how to aggressively go after them jointly," Brown said. "So if we were to draw a curve and say, 'Are we where we would have liked to have been?', the answer is no. Are we better than we have been in the past? The answer is yes."
Brown wouldn't provide details on program targets and results.
But making the program work is a mandate for Brown, 46, who shares that responsibility with Ford's product development group. Brown was handed daily control of global purchasing in January as CEO Bill Ford Jr. engineered a string of changes in the automaker's executive ranks.
Brown's boss, Carlos Mazzorin, who recruited him from supplier UT Automotive in 1999, will move into an adviser role to Bill Ford in August and give way to David Thursfield, currently head of Ford of Europe.
Ford Motor leaders expect the purchasing group - responsible for about 2,000 production suppliers and an annual purchasing buy of more than $90 billion, including nonproduction products and services - to contribute a significant portion of cost-cutting as the automaker strives to return to profitability. In an attempt to turn around a 2001 loss of $5.45 billion, beleaguered Ford Motor wants to chop an average $700 per vehicle by mid-decade.
The Ford North America Design Cost Sharing program strives to wring costs from vehicle programs using design changes and promises to split the savings, with 35 percent going to suppliers. Ford Motor initially assigned 300 engineers to the program and added another 700 this spring. The company has told suppliers that it wants $3 billion in cost reductions from the initiative by 2005.