FORD MOTOR COMPANY EXPANDS KEY SUPPLIER NETWORK WITH 16 NEW COMPANIES
- Ford adds 16 suppliers to the Aligned Business Framework (ABF), bringing the total to 82 members.
- Improving survey results show that ABF principles are strengthening collaboration among suppliers and Ford's Global Purchasing and Global Product Development organizations.
- Ford is accelerating its supplier consolidation plans, and remains on path toward its goal of 750 global suppliers.
DEARBORN, Mich., June 24, 2009 – Ford Motor Company today announced the expansion of its Aligned Business Framework (ABF), adding 16 new members to the select group of key component and service suppliers chosen for long-term relationships and closer collaboration.
The company also said it has accelerated its supplier consolidation plans. Ford' Global Purchasing organization expects to have identified 850 production suppliers eligible for new sourcing by the end of 2009, down from approximately 1,600 at the end of 2008.
"Despite the industry challenges we are all facing, Ford is making steady progress identifying more suppliers for long-term relationships while at the same time reducing our total number of suppliers," said Tony Brown, group vice president, Global Purchasing. "Both of these elements were part of our ABF strategy since it was launched in 2005. They are even more critical now as the auto industry moves through a difficult restructuring period toward a more sustainable business model for suppliers and automakers alike."
Ford has a long-term goal to reduce its supply base to approximately 750 production suppliers eligible for major sourcing. Ford had approximately 3,300 such suppliers in 2004, a number that had dropped by about half by the end of 2008. Because ABF membership is restricted to suppliers of key components and services, not all long-term Ford suppliers will be members of ABF.
With the new members, there are now 82 companies in the ABF network. ABF companies enter into long-term relationships with Ford to strengthen collaboration and drive mutual profitability and technology development. Ford's commitments to ABF companies include sourcing for the life of a program or platform, improved parts commonality and more information sharing of product plans and forecasts. Supplier commitments include increased financial data transparency, consideration of minority- and women-owned suppliers and bringing leading-edge technology innovations to Ford.
"ABF is enabling suppliers to benefit from the ONE Ford strategy that is driving efficiency and commonality across the company," Brown said. "I also attribute Ford's improvements in recent external supplier survey results to the implementation of ABF principles throughout our organization. We still have work to do before we are the customer of choice for all of our suppliers. But I'm confident that by following ABF, Ford will continue to improve our standing with our supply base."
ABF suppliers added since August 2008 are:
Diamond Electric Manufacturing
Kolbenschmidt Pierburg AG
Rieter Holding AG
Saturn Electronics & Engineering+
* Non-production supplier
+ Minority- or Women-owned supplier
Launched in 2005, ABF agreements establish working business models for both Ford and the selected suppliers. The agreements outline business practices designed to increase future collaboration, including phased-in up-front payment of engineering and development costs for production suppliers, extended sourcing and data transparency. Since launch, Ford has identified 59 production and 23 non-production ABF suppliers.
About Ford Motor Company
Ford Motor Company, a global automotive industry leader based in Dearborn, Mich., manufactures or distributes automobiles across six continents. With about 205,000 employees and about 90 plants worldwide, the company's automotive brands include Ford, Lincoln, Mercury and Volvo. The company provides financial services through Ford Motor Credit Company. For more information regarding Ford's products, please visit www.ford.com.