DETROIT - In its constant search for cost savings, General Motors vows to reuse more parts in its vehicles.
This will allow the company to reduce warranty costs and investments in new tooling, GM worldwide purchasing chief Bo Andersson said last week at the Auto-Tech conference in Detroit.
"The key element for the supplier is now you're getting high volume," he said. "You can use the machines and the tools that you already have in place. And the key for us with the suppliers is you typically have much better guaranteed quality and less risk."
GM is identifying such cost savings so it can price its vehicles competitively. GM says it will no longer remove content from a vehicle to save money. "We can't decontent vehicles on the way to prosperity," said Jim Queen, GM's vice president of North America engineering, in a session with Andersson at Auto-Tech.
Neither Andersson nor Queen would disclose GM's cost savings goal for reusing parts. Queen said that GM has different targets for new vehicles, mid-cycle enhancements and annual model updates.
GM has a reputation among suppliers for buying parts as cheaply as possible. But the company may turn its back on a supplier's higher material cost if GM can more than make up for it in warranty costs and tooling investments, Queen said.
He pointed to the 2006 Pontiac Solstice as an example of GM's more aggressive reuse policy.
"My instructions to the organization was 100 percent reuse, recognizing that wasn't going to happen," Queen said. "We talked about where we want to price the Solstice, and that has been a huge enabler in keeping the costs under control."
GM plans to price the two-passenger, sporty car for less than $20,000.
The Solstice, due in the spring, is being built on a new architecture, Kappa. But where GM could, it reused more than 90 percent of the parts, Queen said. GM's first priority was to reuse parts from other GM projects, he said, but it also bought existing parts from other automakers.