Minority Suppliers Benefit from GM Supplier Diversity Group's Focus1999 Contract Awards Total More than $2.2 billion
DETROIT - General Motors announced that it awarded a record $2.2 billion in Tier 1 contracts to its minority suppliers in 1999. This represents an increase of $296 million, or 16 percent, from 1998.
The effort was led by GM's Supplier Diversity Group, a strategic supplier activity within GM Worldwide Purchasing. The Supplier Diversity Group, which was formally known as Minority Supplier Development, is a key component of GM's efforts to build customer enthusiasm in the rapidly growing minority consumer market.
"The 1999 results show that GM is fully committed to supplier diversification," said Harold R. Kutner, group vice president, WWP and North American Production Control & Logistics. "We set an ambitious goal, and we exceeded it."
The contracts awarded to the Tier 1 minority suppliers are for direct and indirect materials. Direct suppliers provide materials, components and systems that are used in the production of GM's cars and trucks. Indirect suppliers provide goods and services used for maintenance, repair and other operations.
"Even with the GM spinoff of Delphi and other subsidiaries, such as Electronic Data Systems, we are posting impressive increases in Tier 1 minority contracts," said J. David Allen, director of the Supplier Diversity Group. "These gains are complemented by the minority purchases made by many of GM's Tier 1 suppliers."
Last year, 200 Tier 1 suppliers awarded more than $1.1 billion in contracts to minority suppliers, more than double what was reported in 1998. GM asks its Tier 1 suppliers to ensure that a percentage of their contracts are awarded to minority suppliers. In 1999, that amount was 5 percent; this year it is 5.5 percent.
"We're proud of the many GM employees whose tireless efforts not only helped increase GM's minority contract awards, but encouraged diversification throughout the automotive industry," said Bo Andersson, executive-in-charge, Worldwide Purchasing.
Exceeding the goal in purchases from minority suppliers was not GM's only achievement in supplier diversity last year.
(Feb. 11, 2000)