Bracing for the Fall

An assessment of the financial health of tier 1 automotive suppliers

Tier 1 automotive suppliers’ struggles seem to have no end in sight. Auto sales are plummeting to 30-year lows, U.S. automakers are threatening to go bankrupt, and tier 2 and 3 suppliers are experiencing financial problems of their own. A recent A.T. Kearney study indicates that more than 50 percent of tier 1 suppliers could enter bankruptcy, potentially costing more than 1 million jobs. However, even in this tough environment, there are actions that suppliers can take to survive the fall and emerge stronger afterward.

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