DETROIT -- In the past, suppliers knew Chrysler as a company that set stratospheric production forecasts only to fall far short.
The gap between the forecasts and actual volumes frustrated suppliers and fostered mistrust. Now the company wants to mend its ways.
Under Fiat management, the new normal is accurate forecasts, said Dan Knott, senior vice president of purchasing and supplier quality.
In 2010, Chrysler Group improved the accuracy of its forecasts significantly, Knott told the Automotive News World Congress. At the beginning of the year, Chrysler's actual production volumes were 8 percent off from the company's targets. By the end of the year, the company had narrowed the gap between target and reality to 2 percent.
"In the past, you could have added a zero to that" 2 percent, Knott said. In fact, the company sometimes missed by 30 to 40 percent, he admitted. "That drove suppliers crazy."
The integrity of production forecasts has been the No. 1 issue among suppliers, Knott said.
Now, he vowed: "We deliver on our forecasts." At the beginning of the year, the company aimed at a global volume of 1.6 million units -- and it hit that target.
In order to improve its forecasting, Chrysler now is open to sharing details of its thinking on new models with suppliers earlier in the conception and design process, Knott said. The company also wants to give suppliers more warning of changes in its production volumes.
Part of the improvement comes from identifying the processes that are broken and fixing them, Knott said. Chrysler has identified "265 processes that were broken. So far we've fixed 197 of them." He suspects the company will identify many more.