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MichMan

(16,894 posts)
1. As someone who worked for auto suppliers for many years, the OEM drove down prices with constant threats
Thu Feb 6, 2025, 10:27 PM
Feb 2025

of using suppliers in Mexico and China. The only way to win any business was by making profit margins so tight that it was hard to attract and keep good workers. Hard to pay people a decent wage when your profit is low and customers won't accept any price increases.

Years ago, a major OEM manufacturer we supplied a lot of product to, demanded a retroactive price cut of a few percent. In other words, they wanted my employer to write them a $8 million dollar check for parts that we had already sold to them that were installed on cars they already sold to customers. We were told if we didn't cooperate, there was a good possibility they would move the business elsewhere. That would have caused the entire plant to close and 250 people to lose their jobs, so we had no choice.

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