Product details

Southfield (Michigan)-based Lear Corporation, one of the world''s largest suppliers of automotive interior components and systems, provides complete seating systems, interior trim products, electrical and electronics systems. Since 2000, the company has been witnessing flat sales and increased raw material costs. Further, it has also been hit by declining business from its major customers like General Motors and Ford that have reduced production in the face of stiff competition from Asian car makers. To minimise its losses, Lear has announced a global restructuring plan in June 2005, which includes factory closures in North America and Western Europe apart from transferring some of its manufacturing facilities to low-cost regions like Eastern Europe and Asia. This case, while highlighting the restructuring strategies of Lear, offers scope to discuss the perils of over dependency of any supplier on a handful of major customers.