While there is much talk about the struggles of the U.S. automakers, according to some experts, it's the automotive supply base that could really bear the brunt of the current high-cost environment.
A recent report from business advisory firm AlixPartners predicts that record high raw material prices--as much as $13bn--seen by the North American automotive supply chain could increase the average vehicle cost in North America by as much as $900 and dramatically impact the automotive supply base in the U.S.
"We all thought times were already pretty difficult in this industry," says John Hoffecker, a managing director of AlixPartners. "But 2008 is shaping up to be one of the toughest years yet. The combination of unprecedented raw materials spikes, the weak dollar and slowing economies around the world is going to make this a year that separates the strong from the weak."
Source: Purchasing, http://www.purchasing.com