Ford was quick to deny recent reports that it was planning to outsource final assembly at its Bahia plant in Brazil. Although it did say suppliers are being offered an increasingly important role in the production process, Ford insisted that it would retain overall responsibility for final assembly.
Even though the reports were apparently inaccurate, there's no doubt that the debate over the increasing power of suppliers is one of the hottest topics in the auto industry.
There's no shortage of people who oppose growing supplier influence. Assembly plant unions, for example.
Despite the relatively cordial relations that automakers and unions have built up in today's European car industry, the trend toward outsourcing of production modules to suppliers could threaten that stability. And too much supplier power could leave automakers exposed to quality problems not of their own making. Nissan Europe President Ian Gibson - who previously ran Europe's most efficient plant at Sunderland in the UK - has often voiced his concerns about an over-reliance on modular assembly.
But there's another reason for automaker sensitivity about the role of suppliers in the production process: brand purity and integrity.
The 1990s has been the decade of the brand in the auto industry, as everyone has tried to differentiate their products in an increasingly uniform world. Daimler-Chrysler has recently developed its own 'brand bible' to ensure everyone in the organization understands what names like Jeep, Plymouth and Smart stand for (see editorial, right). PSA is moving Peugeot and Citroen away from each other after criticism that the brands were becoming diluted. Volkswagen and Ford's Premier Group both see brand building as the key to a successful future.
In the brand-sensitive 1990s, any suggestion that a carmaker like Ford doesn't actually make cars anymore - it just provides the organization that allowed suppliers to assemble cars - could be a public relations catastrophe. Never mind the potential problems with union opposition, or with supplier quality. The damage done to the brand image could be severe.
Back in 1980, if anyone had suggested that future Volkswagen or Audi customers would happily buy cars that shared the majority of their underpinnings with a Skoda, noone would have listened. Just as the industry overcame widespread skepticism about platform sharing, so it will silence critics who think suppliers should maintain their distance from the car assembly process. Powerful, integrated auto suppliers are here to stay.