General Motors has reportedly instructed thousands of suppliers to find alternatives to supply chains in China for parts.
Four people familiar with the matter told the Business Times that executives have been telling suppliers to find alternatives to China for parts and raw materials, with the ultimate goal being to move supply chains out of the country. Some of the sources said that the company has set a 2027 deadline for some suppliers to dissolve their ties with China for supply sourcing.
GM had reportedly approached some suppliers about the topic in late 2024, but renewed the urgency behind the issue in the spring when the US-China trade war was in the beginning stages.
Executives have said that the move is part of a broader strategy to improve "resilience" of the company’s supply chain. The directive also includes other countries that have been subjected to trade restrictions from the US due to national security concerns, like Venezuela and Russia.
The sources said that the effort from the company targets parts and materials that go into cars built in North America, and that while GM prefers to obtain parts from North American factories for vehicles in the region, it is open to non-US supply lines outside of China.
GM CEO Mary Barra said in an October quarterly conference call, "We’ve been working now for a few years to have supply chain resiliency.
GM’s global purchasing chief Shilpan Amin said in October that supply chain disruption risks have forced the company to move away from sourcing materials from countries with the lowest costs. “Resiliency is important – making sure you have more control over your supply chain and you know exactly what is coming where,” he said.
Supplier executives say that pulling supply chains from China can be costly, with the country becoming the dominant supplier of many parts, including custom parts, making it hard to find alternatives.
An executive at one large parts maker said of GM’s initiative, "It’s a big effort. Suppliers are scrambling."
