Car suppliers sitting on £5bn working capital

Europe’s top car suppliers have £5.2bn in frozen working capital, a new
report out today says.

Hackett-REL measures the working capital of the largest 1,000 European
companies, covering more than 70 industry sectors.

The findings on the car industry’s top 17 suppliers, the first in an ongoing
study, show car suppliers are being squeezed by the frontline carmakers whose
production requirements are changing so rapidly.

This excess comes from a variety of business problems such as invoices being
paid late by customers, suppliers being paid too early or inventory lying unsold
on warehouse shelves, the group said.

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