Bo Andersson is General Motors' lightning rod.
One of the quickest ways a struggling automaker can cut costs is to impose price cuts on suppliers. In recent years, Andersson has done that again and again.
Not surprisingly, suppliers have sharply conflicting opinions of the man and his methods. Supplier officials who are willing to be quoted are those who have gained additional GM business during Andersson's reign. They laud him.
Those who have lost GM business - or endured sharp price cuts - are willing to discuss Andersson only under the cloak of anonymity. Some of these suppliers believe GM considers low prices to be more important than quality or technology.
Those views surfaced in an annual survey of 260 suppliers compiled by Planning Perspectives Inc., a consulting firm in suburban Detroit.
Sixty-seven percent of the respondents said they give GM price reductions because they fear losing business or fear retaliation. No other automaker came close. Only 5 percent of the suppliers say they gave Toyota price cuts out of fear of retaliation.
Moreover, only 1 percent of respondents said they cut prices out of loyalty to GM, while 36 percent of Toyota suppliers cut prices out of loyalty.
That's not to say Andersson has no admirers. A number of key suppliers that make parts for GMT900 trucks - the platform for the new Chevrolet Suburban, Cadillac Escalade and other full-sized SUVs - say Andersson is fair but tough.
That platform program could generate healthy profits for suppliers such as NYX Corp. of suburban Detroit, a producer of plastic components and interior trim that has grown rapidly as it has won GM contracts.
"He encourages suppliers, gives them a higher target," says company CEO Chain Sandhu. "We have to meet those challenges and be the best in the industry."
Paul Wilbur, chief executive of ASC Inc., says Andersson's use of data to quantify each supplier's performance has leveled the playing field. "He has brought a very disciplined approach to GM purchasing," says Wilbur, whose company helped build the Chevrolet SSR pickup. "He is not swayed by favoritism or special interests."
Fred Bauer, chief executive of Gentex Corp., of Zeeland, Mich., says Andersson must take stern measures because GM must cut costs: "We've made an attempt to understand GM's needs, and the result is more business and a better relationship."
You may e-mail Robert Sherefkin at [email protected]