DETROIT -- China offers the auto industry unparalleled opportunities for growth and low-cost sourcing, said members of a panel on global purchasing at the World Congress.
"You should look at China as the single biggest opportunity, not only to grow but to reduce costs," said Jack Perkowski, CEO of Asian Strategic Investments Corp., based in Beijing.
But fellow panelist David Nelson, vice president of global supply chain management for Delphi Corp., warned that suppliers must weigh heavily the pros and cons of opening production in China -- even when Delphi asks them to.
Osamu Nagata, vice president of purchasing for Toyota Motor Manufacturing North America, said Toyota is more concerned about finding suppliers with superior quality, project management and technology than part vendors who provide the lowest costs.
China is not the industry's only low-cost option. The panelists said India also commands suppliers' attention.
"The advantage [over China] is they speak English in India," Perkowski said. "Companies there have been established a long time. They tend to be further ahead in terms of lean manufacturing and product development."
"The disadvantage to India is the infrastructure really hasn't changed in the last 10 years ... India also has more taxes."
Michael Dunne, president of Automotive Resources Asia Ltd., sees another disadvantage in India: small profit margins.
"There's a strong demand for cars that are priced between $5,000 (E4,000) and $10,000," Dunne said of India. "In China, consumers will spend big money for expensive cars."