Countering Mandatory 3% Annual Cost-Down Mandates with Value Engineering
Automakers demand automatic 3% year-over-year price cuts. Discover how Tier-1 suppliers use Value Analysis/Value Engineering (VAVE) workshops to protect gross margins.
Amit KasliwalCEO & Founder, Dehurdle
October 12, 20224 min read
The Collaborative VAVE Cost-Down Script
Recommended Spoken Script
"Rather than absorbing a unilateral 3% margin reduction that threatens production quality, we propose a joint VAVE engineering workshop. By replacing the stamped steel bracket with an integrated aluminum die-cast component, we eliminate $4.50 per vehicle in assembly labor, delivering your 3.5% cost reduction while protecting our component margins."
The 2-Minute Practice Drill
2-Minute Spoken Drill
The 2-Minute Practice Drill
Practice VAVE automotive negotiations in Dehurdle.