Swedish seat belt and airbag maker Autoliv has said it would switch more procurement to low-cost countries and predicted big savings.
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“It is becoming increasingly important for us to buy material from low-cost countries and we are moving a bigger and bigger part of our procurement to them. The savings potential is enormous,” chief executive Lars Westerberg told Reuters in an interview.
The report said around half Autoliv’s revenue is eaten up by procurement costs – currently the firm buys most of its components from western Europe and North America.
Reuters said that Autoliv, which makes around two-thirds of its sales in Europe and Asia, has embarked on a cost-cutting programme and has been shifting production to countries such as Tunisia and Mexico.
