DETROIT - Valeo SA plans to use the Internet to transform itself into a faster, more efficient supplier.
Calling itself 'The Connected Enterprise,' the company wants to speed its work flow in such areas as digital mock-ups and allow the virtual integration of suppliers with its project teams.
The Paris-based company now takes 18 months to develop a new headlamp system. But that period could be shortened to as little as 10 months by speeding innovation via the Internet.
With that and other innovations in mind, Edward Planchon, Valeo group vice president for North America, announced a $100-million spending initiative last week at the SAE 2000 World Congress.
Valeo is banking on technology for a boost into the 21st century. Planchon said the company has slated $100 million for its Venture Capital Initiative to develop new technology. 'I expect to find candidates here this week,' he said.
Valeo will provide cash for individuals or companies with promising product, process or Internet technology in return for an option on that technology. He did not detail terms of the program, but he said Valeo would not buy stock in such a venture or use the money to form joint ventures.
'It is the supplier that provides the innovation,' Planchon, a 45-year industry veteran, said. 'But unfortunately, the supplier has to feed itself.'
Planchon said Valeo also expects to grow its Internet-based virtual marketplace for its component purchasing. The company began online bidding in January, and estimates that 50 percent of its $5 billion annual purchasing budget can be conducted this way in the coming years.
Planchon said Valeo's online bidding includes commodity parts, but not the more sophisticated engineered systems.
Working with Valeo's suppliers will make them more efficient and allow Valeo to continue to cut costs to its automaker customers, he said.