Filed under: automotive, cars, cost reduction, ford, material cost, purchasing management, raw materials, steel, USA, way forward
The number 2 US automotive industrial seems to be on the right way to realize its cost reduction goals set for 2008.
According to a Reuters story, Ford exceeded its raw material cost targets by 9% through February. The carmaker expected raw material expenses to decrease by 25% in this month.
Recent upgoing raw material prices, especially for steel, had made life difficult for the automotive industry. Both, suppliers and manufacturers struggle to keep profitable in an environment of intensive competition on consumer prices and a deccelarating demand on main markets.
Ford’s “Way Forward” programme launched in 2006 should improve the automaker’s profitability until 2010. The plan, in its original name “Aligned Business Framework” aims to “align buyers, suppliers, designers and assembly personnel on a single mission of sustainable profitability”. As a financial goal of its plan, Ford announced cost reductions of at least USD 6 billion by 2010.
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