Component suppliers face two more years of price cuts, Rover group chief executive Walter Hasselkus told an automotive parts conference held by the trade union, the T&G, in Birmingham last month.
Hasselkus said Rover’s top 200 suppliers would have to work harder to become more competitive.
`We have invested heavily in Rover and now we must ask suppliers to try harder,’ he said.
Since 1994, German parent BMW has invested £1.5billion in Rover, said Hasselkus, who called on suppliers to improve the quality of their products and delivery. `Quality is paramount but at optimum price,’ he said. `This is a painful problem but one which must be realised.’
Higher quality cars would open up opportunities for new customers and higher prices, he said. He dismissed suppliers’ worries that Rover would increasingly source components from Germany.
`BMW and Rover source globally and this trend will continue,’ he said. `There is no strategic plan to source out of Germany.’