We have no doctrine frozen supplier parks

Automobile & components: What are the strengths of PSA in the field of the purchases

Hervé Guyot: Purchases are more strategic than ever for the group, because they represent about 70 of the cost of the vehicle, and this is even up to 80 for engines.

The strength of the purchases in PSA is that this function is strongly integrated upstream techno-industrial (1). We are very present on the platforms and projects of the group, and it more and more upstream.

A & C: What are your tasks

H.G.: Our mission is, for the 28 billion euros for the purchase of the group to select the best global suppliers on the best terms, to centralize the relations with suppliers. In this framework, we act in a manner fully integrated with the techno-industrial upstream.

A & C: What is the impact of policy platforms on purchases

H.G.: Policy platforms is being deployed. We produced, in 2002, 60 of our volume on our new platforms, and we will reach 90 in 2006. This includes our three platforms and platforms of cooperation and the bodies of the group. In addition, it also concerns cooperation with other manufacturers; development and industrialization of a new vehicle with Toyota, small gasoline with BMW engines and diesel with Ford engines. This policy gives us the ability to play on effects major volumes from suppliers. There is the standardization of the elements on a same platform but also between platforms. On the paper "intra-plates-forms", we aim to share 25-30 of components. The platforms are not be completed.

A & C: What is the financial translation of this policy platforms

H.G.: This strategy has allowed us to earn about 300 euros per vehicle, and we still have the ability to lower our costs 150 euros approximately.

A & C: How this translates to the level of purchases

H.G.: Earnings at the level of purchases are first made in new markets and in life series. For new products, we are looking for with suppliers optimization, both technical and economic.

In addition, we set targets annual or multi-year, ambitious, reduction in prices, which are achievable through productivity / process or technical productivity.

A & C: How do you relations with OEMs in cases where the volumes of goods vehicles are significantly lower than anticipated

H.G.: We distinguish two cases. For great rates, it is clear that the volume risk is shared. For lower volumes, it depends on the case, either one applies the same principle as for large volumes or for certain exceptions, we put in place a specific agreement with the provider.

The providers accept risks volumes. Through our policy volumes and products, we are attractive to OEMs.

A & C: What progress do you perform

H.G.: Progress that we achieve include, inter alia, the robustness of the developments. This, to work with a more robust specifications. We have more and more interactive processes with the suppliers on the drafting of the specifications. Providers should give us the ability to achieve benefits for the equipment itself but in the vehicle environment also.

In the field of developments, and as all the manufacturers, we, sometimes some problems. We apply a very rigorous monitoring of providers in development methodology. Our suppliers are responsible for the design of their product and their process. But must prove us, in the different milestones that their solutions are robust.

All this leads us to the quality in design as one of the bases of the bedrock of our relations with suppliers. We attach great importance to the supplier's ability to build a sufficiently robust product/process together. This can lead to some stronger than before market share providers. Today, reach 60 or 65 with a single supplier we more scares and happens in some cases. For example, the diesel injection, for air conditioning compressors and fuel tanks.

But this does not prevent us to keep a large opening on the market, which is essential to maintain the competition.

A & C: Purchases outside Europe are a lever interesting in this context there

H.G.: The competition is realized more and more international. Historically, our actions were totally concentrated on purchases for local to escape problems, logistical requirements, currency and customs. These actions are totally priority, notably Mercosur and China. There are also opportunities for purchases on these emerging markets for our European needs. This concerns, on the one hand, China, where our just open an antenna purchases in Shanghai, and, on the other hand, MERCOSUR, where we have good conditions to purchase, especially mechanical parts for engines. It is indeed already the case for a number of families of purchases, such as electric beams, a very large majority comes from outside of Europe. In addition, our suppliers buy themselves of 40 to 60 of what they deliver us, including a large part in countries with low costs. This will gradually increase and enable us to grasp sometimes opportunities. Each case must be examined for itself but be wary of simplistic or overall reasoning.

A & C: What are your major concerns on these markets

H.G.: MERCOSUR, our local integration is very inadequate. Hence very strategic actors that we put in place in the Brazil and Argentina in the area of procurement, in accepting the principle of some technical differentiations from Europe. We do not think that can produce exactly the same vehicles in all countries of the world. The specifications must be adapted to increase local integration. In any event, certain benefits are particularly sensitive in some markets, for example, noise in the

China is also a market on which it must accelerate local integration. We are launching the 307 notchback. To increase the local content, we rely on the SAP panel providers, which are present with partners, but local businesses also. This process of local integration is based on a strong delegation to local teams techniques and purchase.

A & C: And in Central Europe

H.G.: The group carries out two important projects, the project B0 with Toyota, where we are responsible for procurement, and implementation of a site at Trnava, Slovakia. The base of suppliers in Central and Eastern Europe is remarkable. Our sourcing is increasing strongly in these countries, including the supply of our Western European sites, there are naturally logistic limits to this movement.

A & C: Are parks suppliers, such as the one which will be implemented at Trnava, the reference for new industrial sites of the Group

H.G.: We have no doctrine frozen supplier parks. Everything depends on the density of tissue provider that we have in place.

We will have to Trnava, an important supplier park. Fifteen of them will establish themselves to carry out industrial operations or logistical operations. For us, the major interest of the suppliers parks lies in optimization of logistic flows. Generally, our suppliers is realize the industrial base of their operations, but the final assembly or logistics.

A & C: Another topic, that you put in place specific or individual on the 407 project

H.G.: On this vehicle, the role of suppliers has been particularly important and we have made progress in integrating into this project. We reach with the 407, a superior quality of the vehicle interior in what we have achieved so far (2). In the new links on the ground of the 407, developed by SAP, we introduce new parts molded and forged aluminum, using the Cobapress method. These pieces are performed by Saint John Industries and Sifcor.

In addition, some versions are equipped with automatic purchased the Japanese supplier Aisin six-speed.

A & C: How guide you in the field of development and procurement of electronic systems

H.G.: SAP retains full responsibility for its electronic architecture and synthesis. For organic parts, we need to implement new ways of development with our suppliers, including for the optimization of schedules, including in the field of software.

This is all the more important that we have an integrated electronic (BSI) interacting in many functions. We seek to use the standards of the market and we joined the Autosar platform, which allows us to work on the modes of communication of the future with other actors in the market.

A & C: Suppliers of rank one have the possibility to buy components to which they wish to or you specify them tracks

H.G.: It always rank two providers will persist for strategic functions. For example, in modules side boards, it is important for us to have a direct relationship with the suppliers of airbags.

But we give our suppliers a growing responsibility in the management of their own suppliers and it is fundamental that their procurement processes become more mature than today ' today. We see some progress on this issue, but it is still far from being General.

A & C: What is the impact of the judgment of Covisint on your relations with suppliers

H.G.: even though we are deeply disappointed by the decision of Covisint, B to B operations are completely secure. Our strategy in this area is a hybrid strategy: on the one hand, our portal of the provider relationship, which already includes twenty-five applications, such as the digital mock-up (150 sites providers there are connected) and, on the other hand, the use of applications on the market for auctions, catalogues, web - EDI, which will continue beyond Covisint.

We continue to develop the auction, with great success and substantial gains. We have a guide of good conduct concerning these auction including indicating that any auction must give rise to the award of a contract. In addition, we are also pursuing Collaborative management, notably through collaborations with Toyota and BMW.Mentor: Profile of Hervé GuyotNé in January 1954, Hervé Guyot started his professional career in the financial management of the PSA group in 1979. He was in charge of relations with banks and financial institutions and, thus, the mounting financial operations and international cash Manager. In 1993, Hervé Guyot joined the leadership of the purchases of the group, where he is appointed Director of the division of industrial policy, in charge of the strategy of purchasing, logistics, of make or buy and international purchases as well as the local integration in the major projects of PSA outside Europe. In November 1995, he became Director of the division in charge of purchases of raw materials and processing (plate, steel, foundry, plastics, rubber and glass...)

In February 1998, at the end of the implementation of the new organization of the group, he became Director of the purchases of the PSA group branch platforms, techniques and purchases.Mentor: B ZéroDans the framework of the project BO, PSA-Toyota, PSA Group assured the purchasing function for all vehicles from this cooperation. Approximately 50 of the purchases will be carried out in Czech Republic. The rest of the equipment and components will mostly come from Romania, Hungary, Poland and Slovakia.

The base of suppliers of the project is very divided between present PSA providers in Eastern Europe and a large number of Japanese suppliers. Thus, Valeo is very present on this project, but PSA, said Hervé Guyot, "has initiated new contacts with Japanese OEMs, such as Futaba for stamping".

For this project, SAP procurement Directorate has implemented a "Purchasing Team" of some 20 people. "The experience gained in this project is very rewarding for both parties," says Hervé Guyot.