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GM looks for alternative supplies after China factory blast

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GM looks for alternative supplies after China factory blast

General Motors has asked its main Chinese supplier to find an alternative source of components after an explosion destroyed a factory, resulting in the death of 69 people. The accident that happened at the Zhongrong Metal Products Co Ltd plant was China’s worst industrial accident in a year.

GM stated that it bought components from a company named “Dicastal” which works with Zhongrong, distancing itself from the factory that has on its website General Motors listed as one its wheels clients. General Motors went on to say it has no direct dealings with Zhongrong, describing it as a “Tier-2” supplier. It added that Tier-1 component suppliers like Dicastal are “required to source from Tier-2 suppliers who must meet both in-country environment and safety standards as well as quality standards.”

The U.S. car manufacturer said the production was not affected by the accident as there was sufficient inventory of the parts, but they did not specify what the components were. The General Motors statement claimed that it was “too early to determine the cause of the explosion. We will closely monitor the investigation and, if asked, will provide any resources and information that can assist in this matter.”

The blast reportedly took place in a workshop that polishes wheel hubs. The local government said on Saturday that a preliminary investigation suggestion it was caused by a flame lit in a dust-filled room, which represents a serious safety breach. A GM spokeswoman in Shanghai said that she had no information on whether GM conducts safety inspections of production facilities run by lower-tier suppliers that GM does not directly do business with.

by Serafim Zetel Cornel - Tuesday, August 5th, 2014 - filed under General Motors, News. Image credit: .
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