BMW and Daimler Seek Joint Purchasing in NAFTA

The economic crisis keeps pulling two of the German car manufacturers closer together, as they try to elude the effects of the downfall. After going as far as trying to swap 7 percent in shares, BMW and Daimler now look to expand their cooperation in the North American Free Trade Area (NAFTA) as well, Autonews reported.

According to Herbert Diess, BMW's head of purchasing, representatives of the two companies are meeting on a weekly basis to discuss joint purchasing in North America. "We are coordinating sourcing decisions in the NAFTA region. We are both equally positioned there," said the official.

One of the crucial aspects discussed by the two companies is the joint assessment of suppliers. Under the terms of a future agreement, if a supplier gets a positive result after undergoing an audit from one of the companies, the supplier will also become eligible for going into business with the other manufacturer as well.

The talks between the two parties are now entering its seventh month, a lot of the time being spent on identifying components suited for joint purchasing. Diess did not give much details, but he did mention the parts are "commodities such as electronics and mechanical components."

Until now, BMW and Daimler said they identified some 40 common components.

Taken separately, the two manufacturers buy some 50 billion euros worth of parts. Even if no official estimate of how much they hope to save by signing the deal, the current joint purchasing in other parts of the world could "save both of the companies hundred of billions of euros in the long run," as an BMW official said earlier this month.
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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