Ford Aims to Shrink Supplier Count 40%

Ford Motor Co. says it intends to eventually trim its list of suppliers from the 1,260 it had last year to about 750 companies.

Hau Thai-Tang, Ford Motor Co.'s new purchasing chief, tells reporters the company currently buys 80% of its parts from 100 companies. He reiterates the company's goal of establishing long-term strategic partnerships with its key suppliers.

Noting that the company's supply base is running near maximum output in North America, Thai-Tang says Ford is now monitoring its vendors on a weekly basis to determine how close each one is to operating at full capacity. The company's goal is to avoid straining suppliers beyond their capabilities and thus risking lost production.

Ford's desire to shrink its supplier count coincides with the company's shift to fewer vehicle platforms: from 27 chassis in 2007 to 14 today and only nine by 2017.

Consolidating platforms has hiked profits, enabled the same parts to be used in more vehicles and shortened the time needed to redesign existing models or introduce new ones.