Paper Says Ford to Drop 1,700 Suppliers

FRANKFURT, Jan 23, 2006; Reuters reported that Ford Motor Co intends to cut the number of its suppliers around the world to around 800 over the next few years from about 2,500 now, industry paper Automotive News reported on Monday.

That would be a bigger drop than originally planned by Ford, which has said in the past it would reduce the number of suppliers by around half in a bid to get better technology at lower cost.

Ford buys about $70 billion of parts annually, the paper said.

The number two U.S. carmarker was due later on Monday to unveil details of its second restructuring of North American operations in four years.

Automotive News quoted Neil De Koker, president of the Original Equipment Suppliers Association, as revealing the new supplier number last week while addressing an Automotive News conference in Michigan.

He said Ford's global purchasing chief Tony Brown had outlined the plan to 600 suppliers at a meeting in October.

The paper said Ford spokesman Paul Wood had confirmed the more aggressive goal.

Ford has already announced 27 preferred suppliers who will increase their future business with Ford. They include Johnson Controls Inc, Dana Corp , Lear Corp and Visteon Corp.