Imported parts will make up about 20 percent of the new engines that DaimlerChrysler Corp. will build in Dundee, Mich., next year.
The program to produce four-cylinder engines for North American vehicles will rely on camshafts and connector rods produced in Japan, among other imported parts. In addition, the program will use balance shaft modules made by Metaldyne Corp. in Korea, says Bruce Coventry, president of the Global Engine Manufacturing Alliance.
The alliance is a partnership between DaimlerChrysler, Mitsubishi Motors Corp. and Hyundai Motor Co. It plans to manufacture a common engine family in the United States, Japan and Korea.
Coventry says the partners identified currency fluctuations as a potential problem at the outset and made efforts to minimize importing.
About half of the suppliers to the Dundee production site are Asian-based, Coventry says, but most of those companies will produce their parts at North American factories.
In the interest of holding down costs, the engine partnership has kept a stern watch out for currency changes, he says. In addition to buying parts in Japanese yen and Korean won, it is also grappling with changes during the past year in the euro and the Canadian dollar.
Weve really worked closely on this with our finance and treasury departments, he says.
Coventry declined to identify other suppliers to the project.