Visteon President Sees Further Supplier Consolidation Because Of Slower Economy.(Michael Johnston)(Brief Article)

Suppliers rushing to globalize must resist the temptation to stray from their core automotive business or risk being swept away in a slowing economy, an executive of Visteon Corp. said.

Michael Johnston, president and chief operating officer of Visteon Corp. said, at a recent appearance in Detroit, an expected slowdown in vehicle sales will result in "consolidation and some unexpected funerals" of suppliers who don't provide automakers innovative products that will make their vehicles more attractive to buyers.

Speaking at a meeting of Sales and Marketing Executives of Detroit, Johnson was quoted as saying "We've got to stop thinking of new noncore business or globalization opportunities as the next best thing to sliced bread." "We can't be everything to everybody." Johnston said in the 1990s that the auto industry believed globalizing bought it immunity from a cyclical nature of the business, but while manufacturing capacity was added in emerging markets, sales did not keep pace.

Visteon said it is making progress on a goal of increasing non-Ford business to 20 percent of revenue by 2002. So far in 2001, non-Ford business is 18 percent of revenue.

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