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General Motors To Diversify Axle Supply for New Vehicles

The Detroit Three automakers were extremely vertically incorporated for several years, with numerous providers being captive divisions or subsidiaries. Over the last a number of years for numerous reasons, the car manufacturers have spun off much of these departments into independent business such as Visteon, Delphi, and others. For several years, American Axle Manufacturing (AAM) was a main supplier to its parent business General Motors. Following AAM’s acquisition of Metaldyne Efficiency Group for $3.3 billion, the company will restructure and diversify its customer base. As part of the restructuring, AAM will not be the unique supplier for the next generation of General Motors’ fullsize trucks. However, the company is still expected to be the primary provider, with 65 percent of business.

Ford is anticipated to be a huge part of AAM’s company moving forward, making Dearborn the company’s third-biggest consumer, after General Motors and Fiat Chrysler Automobiles. The company anticipates to expand its organisation in Europe, along with Metaldyne’s core business of iron castings, that include guiding knuckles, control arms, and differential cases. AAM likewise supplies its EcoTrac all-wheel-drive system for the KL Jeep Cherokee. AAM was spun off from General Motors in 1993. In 2015, GM still represented 66 percent of the company’s business.

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