Left: Aerial view of Toledo North complex courtesy of Safety Bubba.com
(Toledo, OH) Local news reports noted the firing of four management personnel and disciplinary action taken against nine others at the Toledo Jeep complex.
Ed Saenz, a spokesman for the DaimlerChrysler in refused to divulge the nature of the charges, except to say that it "involved violations of the firm’s policies and procedures."
Sources at Toledo Jeep provided me with more detail on the reasons why the 13 management personnel came under investigation.
"Everyone in the plant knows what's going on, because this is the way things work around here," said one source. "DaimlerChrysler is notrious for making their suppliers wait 3-4 months for payment, and these managers were facing a lot of pressure from suppliers to get paid."
The suppliers and managers worked out a plan: suppliers would get overpaid on invoices, creating a sort of financial cushion against the DCX strategy of holding onto invoices. Managers would then be able to get supplies they needed, since suppliers no longer threatened to withhold delivery.
"This was a way that these employees could keep the plant running," he said. "If a part cost $500, and I as a manager agreed to submit an invoice for $1000, then the supplier had a float of $500 to protect him against DaimlerChrysler's 'slow-pay' philosophy."
The source said that smaller suppliers are the firms most likely to be put on the 'slow-pay' system.
"Face it - DCX is a huge company, and if they can get away with sticking it to small suppliers, they will," he said. "Imagine what $50,000 is worth over 4 months at 10% interest."
It is unlikely that the disciplined managers personally profitted from the scheme, said a source.
"This is how average people deal with a situation created at the top of the company. If you need a part for a robot that will stop the line, and the supplier refuses to deliver it because DCX is 4 months behind in payment, you work a deal with the supplier," he said. "Anyone who has ever had to sign a supplier's invoice knows that this company stalls as long as possible to pay their bills, and essentially holds hostage the small suppliers."
One source added that he knew some of the disciplined and fired men.
"These are good people, and some of them have been here for many years," he said. "It's a shame that they are being disciplined for trying to keep the plant running."