Valeo Quality Improves by Two Orders of Magnitude from ’04 to ‘08

In 2004, the rejection rate of Valeo parts was 870 ppm. By the end of 2007, the figure had been slashed to 10 ppm. The prime mover behind this dramatic improvement has been Valeo’s experience with Toyota Europe. While supplying only four percent of Toyota’s lighting, Valeo learnt year upon year how to improve production quality. As a result, Valeo are now rated by Toyota as a “Very Good Supplier”, with 3 Quality awards won in 2007. Valeo exemplifies the supplier who greatly improves by learning and implementing Toyota’s best practices. For example, Valeo have launched VPS, the Valeo Production System —a close copy of TPS, the Toyota Production System.

Kazuo Kawashima, the Japanese quality director from Nissan, came to Valeo in 2003 and built a team of 5 “Toyota people”, one dedicated to Toyota management in Brussels and the remaining four closely following the daily operations and incidents in Toyota’s European plants.

Thierry Morin, Valeo’s CEO wants Valeo to talk about ultra-low rejection rates measured in ppb (defective parts per billion), with the long-range goal of taking the lead as the best-quality supplier to the automotive industry.

Morin believes in Valeo’s ability to lead in quality and technology at the same time, and says 30% of 2007’s orders included advanced driver assistance technology such as Lane Departure Warning, Blind Spot Detection, Stop and Go, Park Assist, and Xenon/AFS lighting.

He confirms the company’s 2010 targets — operating income growth to 6% (from 3.6% in 2007) via functional restructuring and purchasing improvements..