Yazaki Foresees Little Impact From Ford’s Hybrid Decision

TRAVERSE CITY, MI – Ford Motor Co.’s decision to pull back from its goal of building 250,000 hybrid-electric vehicles by the end of this decade won’t have a major impact on Yazaki North America, President and CEO George Perry says following an address at the Management Briefing Seminars here.

Yazaki is a leading supplier of high-voltage connection systems for hybrids and has been developing this technology over the past 10 years, Perry says.

“It’s still a niche for us,” he says. “Did we anticipate the Ford cutback? No, mainly because (Ford CEO) Bill Ford was out there saying that (250,000 HEVs) was his goal.

“It’s still small business. If it grows by 10% a year, that’s different,” Perry points out. “But at this stage, it’s not significant. I suppose if you’re going to cut back, you’d do it now. It’s not a major issue other than, ‘Too bad.’”

Ford is not abandoning HEVs, but says its focus now will become broader to include a number of alternative strategies, such as biofuels and diesels, to improve fuel economy and lower emissions.

Yazaki consumes huge quantities of copper for the wiring harnesses and other components supplied to auto makers. With copper prices soaring, what impact is this having on Yazaki?

George Perry

“We’ve got to have copper sources, regardless of prices (and) wherever it comes from, so everyone has to live that,” he says.

During his formal address, Perry urges suppliers to take into consideration all contingencies in determining their cost structures. Low labor rates in a given country or area may not be the end-all because snafus in logistics and timing may offset labor costs, especially as sourcing expands globally, he says.

Perry says suppliers and auto makers should work closely when launching new products to avoid pitfalls down the road.

“You’ve got to look at delivered costs, not landed costs,” he says. “Don’t glide past logistics costs.”