Ford sales collapse in JulyBecause the per unit cost is higher if you have multiple suppliers. Why? Because you have to have multiple sets of tooling, which has to be amortized over the entire production run. If the production run is split between 2 suppliers the cost of tooling per unit doubles, triples if it is split over 3 suppliers. Every part that is created by an OEM goes through a make/buy analysis where the part is put out for bid from various suppliers and those costs are compared to the cost of producing it in house. Every supplier is going to bid the cost assuming they get the entire production run. So if Ford said we want 50,000 units, they would bid the part based on a run of 50,000. The winning supplier usually has a cost advantage going into subsequent rounds for extended supply because they already have the tooling and it was already amortized on the first run. The only parts that are not single source are commodity parts that are routinely produced by several manufacturers that supply multiple OEM's.Thu, 05 Aug 2021 13:10:40 +0000
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