Article: "Volkswagen snubs Big 3 online parts exchange"
07-11-2001, 12:02 PM
#1
Article: "Volkswagen snubs Big 3 online parts exchange"
Copyright 2001 Associated Press
AP Worldstream
July 11, 2001; Wednesday 2:36 PM Eastern Time
SECTION: Financial pages
DISTRIBUTION: Europe;Britian;Scandinavia;Middle East;Africa;India;Asia;England
LENGTH: 450 words
HEADLINE: Volkswagen snubs Big 3 online parts exchange
BYLINE: ED GARSTEN
DATELINE: DETROIT
BODY:
In an apparent snub of Detroit-based online auction cooperative Covisint LLC, Volkswagen AG has signed a deal that would increase its ability to carry out its
own auctions.
The German automaker said Wednesday it had signed a six-year agreement with eBreviate, a unit of EDS.
The Walnut Creek, California-based eBreviate will provide software and technology enabling Volkswagen to conduct auctions among parts suppliers for all of its
brands worldwide including VW, Audi, and Skoda.
The agreement extends the current deal which covered 270 auctions that already have been concluded and is worth ''millions of dollars,'' according to Sarah Pfaff,
executive vice president of sales, marketing and strategy at eBreviate.
''We did not join Covisint because we think Volkswagen is too huge to adapt to the lowest possible way of doing things as you would do if you joined,'' said
Volkswagen spokeswoman Emanuela Wilm from the company's Wolfsburg, Germany, headquarters.
She said the company did not believe working within a system set up by U.S. automakers would be ''optimum'' for Volkswagen.
Covisint, an online exchange formed by General Motors Corp., Ford Motor Co. and DaimlerChrysler AG last year, had hoped to entice Volkswagen or BMW
AG to join.
''It's more of a disappointment for the supplier community who are now being forced to support a second protocol,'' said Dan Jankowski, Covisint vice president
of corporate communications.
Jankowski did not believe Volkswagen's move would hamper Covisint's efforts to lure other automakers into the exchange.
''It's a big industry. Volkswagen is one company,'' he said.
Nissan of Japan and Renault of France joined Covisint in April 2000.
Pat Dessert, the director of Oakland (Michigan) University's product development manufacturing center says Volkswagen's rejection of Covisint makes sense.
''They probably figured, let's not help a potential competitor,'' he said.
While predicting Covisint would not be too badly hurt by Volkswagen's desire to go it alone, Dessert said the exchange's future was uncertain.
''They're trying to do business in a world where dot-coms are crashing,'' Dessert said.
Pfaff said Volkswagen planned at least 700 auctions this year and would save ''hundreds of millions of dollars'' in parts procurement.
The deal with Volkswagen is not exclusive, Pfaff said, and the company would be open to providing online auction technology to other automakers.
Pfaff said eBreviate has done business in the past with Ford of Brazil and several suppliers.
AP Worldstream
July 11, 2001; Wednesday 2:36 PM Eastern Time
SECTION: Financial pages
DISTRIBUTION: Europe;Britian;Scandinavia;Middle East;Africa;India;Asia;England
LENGTH: 450 words
HEADLINE: Volkswagen snubs Big 3 online parts exchange
BYLINE: ED GARSTEN
DATELINE: DETROIT
BODY:
In an apparent snub of Detroit-based online auction cooperative Covisint LLC, Volkswagen AG has signed a deal that would increase its ability to carry out its
own auctions.
The German automaker said Wednesday it had signed a six-year agreement with eBreviate, a unit of EDS.
The Walnut Creek, California-based eBreviate will provide software and technology enabling Volkswagen to conduct auctions among parts suppliers for all of its
brands worldwide including VW, Audi, and Skoda.
The agreement extends the current deal which covered 270 auctions that already have been concluded and is worth ''millions of dollars,'' according to Sarah Pfaff,
executive vice president of sales, marketing and strategy at eBreviate.
''We did not join Covisint because we think Volkswagen is too huge to adapt to the lowest possible way of doing things as you would do if you joined,'' said
Volkswagen spokeswoman Emanuela Wilm from the company's Wolfsburg, Germany, headquarters.
She said the company did not believe working within a system set up by U.S. automakers would be ''optimum'' for Volkswagen.
Covisint, an online exchange formed by General Motors Corp., Ford Motor Co. and DaimlerChrysler AG last year, had hoped to entice Volkswagen or BMW
AG to join.
''It's more of a disappointment for the supplier community who are now being forced to support a second protocol,'' said Dan Jankowski, Covisint vice president
of corporate communications.
Jankowski did not believe Volkswagen's move would hamper Covisint's efforts to lure other automakers into the exchange.
''It's a big industry. Volkswagen is one company,'' he said.
Nissan of Japan and Renault of France joined Covisint in April 2000.
Pat Dessert, the director of Oakland (Michigan) University's product development manufacturing center says Volkswagen's rejection of Covisint makes sense.
''They probably figured, let's not help a potential competitor,'' he said.
While predicting Covisint would not be too badly hurt by Volkswagen's desire to go it alone, Dessert said the exchange's future was uncertain.
''They're trying to do business in a world where dot-coms are crashing,'' Dessert said.
Pfaff said Volkswagen planned at least 700 auctions this year and would save ''hundreds of millions of dollars'' in parts procurement.
The deal with Volkswagen is not exclusive, Pfaff said, and the company would be open to providing online auction technology to other automakers.
Pfaff said eBreviate has done business in the past with Ford of Brazil and several suppliers.
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