Lower production volume and the strong euro are pushing Ford Motor Co. to chop as much as 25 percent from the cost of its continuously variable transmissions engineered by German supplier ZF Friedrichshafen.
Gerhard Wagner, group vice president of the car transmission division at ZF, says Ford started cost cuts, including seeking non-European suppliers, after the companies' joint venture ended this year.
"I think you have to keep in mind that the exchange rate from euros to U.S. dollars has dramatically changed during the last year," Wagner says.
The euro has risen by nearly 60 percent against the dollar since 2000, increasing the cost of European goods here. Ford's plans for the transmission are down 75 percent from the Jac Nasser era, when it wanted to sell the Ohio-built CVT to other automakers.
But while Ford has been shopping for non-European suppliers, the design of the CVT will not change.
Ford spokeswoman Tammera Hallums says the automaker is concentrating on production efficiencies at its Batavia, Ohio, CVT plant. She would not comment on changes made to the CVT. Ford and ZF did not reveal names of suppliers to the project.