GM inks deal to guard against future parts-supply shocks

By Kalea Hall

DETROIT, ‌Aug 11 (Reuters) -

General ​Motors ​said it has entered an agreement with a third-party inventory management company to ensure ‌access to future supply of critical parts.

The ⁠automaker said in a Tuesday regulatory filing that it has ‌set up a $4.5 billion ‌purchasing facility, under which it will arrange for an outside firm, Procura Auto Parts, to purchase ​certain parts from suppliers, freeing up GM’s working capital.

• The program is aimed at securing “certain ⁠critical inventory” GM would need to continue making cars in the ​event of supply chain disruptions, such as natural disasters, a cyberattack or excess demand, ​it said.

• Banks including JPMorgan ‌Chase and Santander will fund Procura, backed by GM’s payment guarantees, it said.

• ⁠The automaker did not specify which parts it deems critical under the agreement, which is to last three ⁠years.

• Procura, which has been in the inventory management business ​since 2015, operates from London, Frankfurt and New York, according to its website. The company buys, sells and manages ‌commercial goods and materials.

• Automakers have more actively managed supply chains following the ‌COVID-19 pandemic, which showed how vulnerable they were ⁠to disruption as a ‌result of supply ​shortages, especially of computer chips.

(Reporting by Kalea Hall; editing by Mike Colias and David ‌Gaffen)

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