by CMayne » Fri Mar 21, 2014 5:55 pm
I found this to be an "interesting" article under MSN Money today. In reality it explains ALOT! GM has gone from making money through "bad supplier relationships" to making money through bad "buyer" relationships, IE: the Dealer. RIM, SLP and on and on.
This IS quoted from the article and the last paragragh pretty much says it all, even though the whole article is pretty spot on.
"GM’s Supplier-Squeezing Days Gave Birth to Flawed Models
Global Plan
GM’s plan was to develop its Ion, Cobalt and Opel Astra cars from the same mechanical platform, code-named Delta, these people said. That called for GM’s European operations to take the lead in developing the car jointly with Fiat, in which GM had taken a 20 percent ownership stake in 2000. The thinking went that the Europeans, small-car specialists, could engineer a model with more amenities and a racier ride that would command higher prices than the no-frills Chevy Cavalier, which had been on the U.S. market for two decades.
The effort ran aground over acrimony between GM and Fiat, which slowed the car’s development and endangered the U.S. operation’s deadline. GM and Fiat would eventually part ways through a bitter split that required the American automaker to pay $2 billion to exit the marriage in 2005.
As the plan to build a profitable “world compact” fizzled, GM patched Cobalts and Ions together with parts scavenged from other models. At the engineer meeting, Altman told attendees that GM’s U.S. compacts would share some parts with the Opel Astra, come up with some new ones and even take some from the aging Cavalier, said the person who was there.
Bad Reputation
GM also turned up the heat on its suppliers, especially Delphi, which had been spun off from the automaker in 1999 and still depended on GM for 90 percent of its business, according to a person familiar with the supplier.
GM had the worst supplier relations among major automakers from 2002 to 2005, according to an annual survey of more than 250 suppliers conducted by researcher Planning Perspectives Inc. of Birmingham, Michigan. In 2005, 85 percent of GM suppliers characterized their relationship with the automaker as “poor,” and 53 percent would “prefer not to do business” with the company or were “ambivalent” about it, according to the survey."