• Production of next generation SUVs - including plug-in-hybrid versions - will start in 2018 at Tuscaloosa
  • Strategic discussions inform local suppliers of needs
  • Daimler purchasing chief: "More than ever before, partnership with our supplier network is taking centre stage"
Delegates at the 2018 Mercedes US supplier event

Delegates at the 2018 Mercedes US supplier event

Purchasing and operations managers of Daimler's Mercedes-Benz Cars and Mercedes-Benz US International (MBUSI) have met with representatives of 240 suppliers at the company's annual supplier forum.

MBUSI said it had held forums to "orient its suppliers to expectations for its new models prior to every launch" since the plant first began building SUVs for global sale in 1997.

This year, MBUSI said, its officials "spent considerable time articulating supplier needs for the next generation SUV – which will include new plug-in-hybrid models – that will be presented later this year".

"More than ever, partnership with our supplier network is taking centre stage"

"More than ever, partnership with our supplier network is taking centre stage," said Mercedes-Benz Cars' procurement and supplier quality chief Klaus Zehender.

"Our exacting standards begin with our demanding production programme so it is critical that we work closely with our suppliers from these initial conversations all the way through final assembly."

The annual forum provided supplier partners and the automaker "with an invaluable opportunity to exchange ideas and strengthen our relationship", he added.

MBUSI president and CEO Jason Hoff, also manager of the Tuscaloosa plant, stressed the ongoing importance of SUV production in Tuscaloosa: "The [plant] is our primary SUV production site with the current GLE, GLE Coupe and GLS series produced here exclusively for [all markets]. We've realised tremendous success in securing strong suppliers and partners to help us build our world-class vehicles..."

Localisation important strategy component

Mercedes-Benz Cars said it traditionally buys its components near its assembly plants and the localisation rate in the US was higher than the federal regulatory requirement.

Currently about 200 US based suppliers work for the Tuscaloosa plant. Most are companies that followed the automaker to Tuscaloosa in the mid-90s and built US factories nearby. For example, Samvardhana Motherson Peguform (SMP), a global player from India, will supply the bumpers and door panels for the next SUV models. SMP recently built a plant in Tuscaloosa and is currently in the process of hiring a workforce.

Daimler Group companies in the US employ around 24,400 people - 8.3% of the group's global workforce. The company indirectly supports an estimated 150,000 additional jobs across the country, producing mainly passenger cars and commercial vehicles at 23 locations. US based corporate assets also include Daimler Financial Services, car2go and moovel, as well as several research and development locations.

Mercedes-Benz Tuscaloosa

The plant is currently being expanded to a high-tech location for SUV production and will be "prepared for electric mobility". This includes the production of EQ-branded SUV models plus construction of a battery factory near the existing car plant. Tuscaloosa was the first major Mercedes car factory outside Germany (it also had a long-established South African factory which started RHD exports in the 1990s plus local KD kit assembly in restricted markets like Brazil and Malaysia -ed) and, the automaker claims, "is considered the nucleus of the automotive industry in Alabama".

The site currently employs 3,700 and indirectly supports an estimated 22,000 additional jobs of which approximately 10,000 are at suppliers and service providers in the region.

Since 1995, around US$6bn has been spent at Tuscaloosa which, in 2017, built 280,000 vehicles.

Two thirds of the SUVs produced are exported worldwide, making Mercedes-Benz Cars the second largest vehicle exporter in the US. C-class car production for North America began in 2014.

In the first five months of 2018, Mercedes-Benz sold 132,000 cars in the US and claims market leadership amongst premium manufacturers. SUVs are the company's most popular models.