supplier manual rev03 2011 thyssenkrupp

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Revision 03 – May, 2011 ThyssenKrupp SupplierManual ThyssenKrupp Metalúrgica Campo Limpo

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Supplier Manual Rev03 2011 Thyssenkrupp

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Page 1: Supplier Manual Rev03 2011 Thyssenkrupp

���������������������������������������������������������������������������

Revision�03�–�May,�2011�

ThyssenKrupp�

Supplier�Manual�

ThyssenKrupp�Metalúrgica�Campo�Limpo�

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ThyssenKrupp�Metalúrgica�Campo�Limpo�

FOREWORD���As� the�global�competition�for� leadership�and�new�markets�becomes� increasingly� tough�companies�are� forced� to� turn� swiftly� to� a� new� businesses� paradigm� consisting� in� offering� “world-class”�products,�prices,�delivery�terms,�services,�and�technology.���The�companies�of�the�ThyssenKrupp�Metalúrgica�Campo�Limpo�Ltda.�Group,�since�they�operate�in�such�a�context,�require�their�suppliers�to�comply�with�Continuous�Improvement�practices�as�a�way� of� ensuring� participation� in� the� industry� and� also� the� development� of� new� business� in� the�whole�production�chain.���These� new� performance� standards� demanded� by� today's� industry� imply� in� as� much� the�development�as�the� improvement�of�a�Quality�System�which�will�help�our�suppliers�to�attain�their�goals.���There� fore,� we� are� addressing� this� Manual� as� a� basic� guide� line� that� will� orientate� the� future�relationship�between�our�organizations.�Following�these�Instructions�your�company�will�be�ranked�as�one�of�the�preferential�suppliers�for�future�businesses�with�ThyssenKrupp.���Should�any�question�arise�from�the�content�of�this�Manual�please�do�not�hesitate�to�contact�us.�������������

������ ����������MARCOS�DE�SÁ�F.�MACEDO���������� � � � �MARCIO�ZILLETTI����������Quality�and�Production�Systems�Manager�����������������������������������Supply�Chain�Manager������������

ThyssenKrupp Metalúrgica Campo Limpo Ltda., Av. Alfried Krupp, 1050, Campo Limpo Paulista – SP, 13231-900, Brazil Phone : (+55 11) 4039-9000 - Fax: (+55 11) 4039-1127 Internet : www.thyssenkrupp-metalurgica.com CNPJ : 50.942.135/0001-44 �

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ThyssenKrupp�Metalúrgica�Campo�Limpo�

TABLE�OF�CONTENTS�

��1.�Purpose�...………………………………..............................……..................�

2.�Application…….……………………………..................................................�

3.�Supplier�requirements�…….........................................................................�

�������3.1.�Safety...............................................................................................�

�������3.2.�Environment�......................................................................................�

�������3.3.�Compliance�with�legislated�requirements�...............................................�

�������3.4.�Quality�system�...................................................................................�

�������3.5.�Quality�goals�………...........................................................................�

��4.�Communication�procedures/homologation�of�new�suppliers.............................�

������4.1.�Consultation/quotation�.........................................................................�������4.2.�Requirements�and�clarifications�of�documents�from�TKMCL.......................�������4.3.�Ensuring�viability�before�quotation�preparation�………..............................�������4.4.�Issuing�quotations�...............................................................................�

���5.�Approval�of�new�suppliers�..........................................................................�

�������5.1.�Suppliers�pre-defined�by�customers�......................................................�

�������5.2.�Approval�of�new�suppliers....................................................................�

���������������5.2.1.�Suppliers�of�raw�materials�(steel/blocks)�and�components�..............�

�������5.3.�Suppliers�for�the�TKMCL�molding�area�...................................................�

���6.�Requirements�for�logistics�and�packaging�....................................................�

�������6.1.�Supplier�logistic�concept�.....................................................................�

�������6.2.�Prompt�response�to�problems�..............................................................�

�������6.3.�Material�delivery�schedules�…..............................................................�

��������������6.3.1.�Electronic�Data�Interchange�-�EDI�.................................................�

��������������6.3.2.�Planning�rules�...........................................................................�

��������������6.3.3.�Penalties�..................................................................................�

��������������6.3.4.�Production�capacity�increase�.......................................................�

��������������6.3.5.�Advanced�Shipping�Notice�-�ASN�.................................................�

�������6.4.�Packaging�.........................................................................................�

��������������6.4.1.�General�requirements�.................................................................�

��������������6.4.2.�Package�identification�labels�.......................................................�

�������������������������6.4.2.1.�Specifications�for�labels�…..............................................�

�������6.5.�Shipping/�transport�.............................................................................�

�������6.6.�Logistic�system�assessment�…….........................................................�

�������6.7.�Warehouse�evaluation�…….................................................................�

���7.�Development�of�products�and�processes�(raw�material�and�components)�.........�

������7.1.�Suppliers�development�in�conjunction�with�the�final�customers�..................�

������7.2.�Capability�requirements�for�special�characteristics�...................................�

������7.3.�Requirements�for�traceability�and�document�control�.................................

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������7.4.�Data�entering�in�the�IMDS�-�International�Data�System�..............................�

�������7.5.�Submission�of�samples�.......................................................................�

���������������7.5.1.�Prototypes�...............................................................................�

���������������7.5.2.�Production�Approval�Procedure�-�PPAP�samples�...........................�

���������������7.5.3.�Readiness�audit�.......................................................................�

���������������7.5.4.�Capability�assessment�-�Run�at�Rate�..........................................�

�������7.6.�Audits�of�products�and�processes�….....................................................�

�������7.7.�Inspection�of�lay-outs�and�functional�tests�.............................................�

�������7.8.�Requirements�for�special�processes�......................................................�

���������������7.8.1.�Heat�treat�process�....................................................................�

���������������7.8.2.�Superficial�treatments�process....................................................�

��8.�Processes�and�products�changes�................................................................�

��9.�Approving�deviations�/�reworks�....................................................................�

10.�Assessment�system�for�components�and�raw�materials�suppliers.....................�

�������10.1.�Supplier�assessment�system�goals�.....................................................�

�����������������10.1.1.�Quality�Performance�(QP)……….…….....................................�

�����������10.1.1.1.�QP�calculation�method�for�raw�material�and�component�suppliers……………………………………………..�

�����������������������������10.1.2.�Quality�System�Rate�(QSR)……..............................................�

������������������������������10.1.2.1.�VDA-6.3�process�audits�x�(QSR).................................�

�����������������10.1.3.�Delivery�Performance�(DP)......................................................������������������10.1.4.�Customer�Care�(CC)…………..................................................�

�����������������10.1.5.�Global�Supplier�Performance�(GSP)�..........................................�

�������10.2.�Assessment�of�the�Global�Supplier�Performance�(GSP)...........................�

11.�Assessment�system�for�suppliers�of�machining,�mounting,�and�mold�heat�treat�services�of�and�forging�accessories�……….........................................................�

������11.1.�Quality�Performance�(QP)�calculation�method�for�molding�area�suppliers…�������11.2.�Quality�Supply�Documents..................................................................�

������11.3.�Heat�treatment�assessment.................................................................�

12.�Supply�problems�………….........................................................................�

������12.1.�Containment�plan�…..........................................................................�

������12.2�Cost�recovery�....................................................................................�

13.�Supportive�documents�...............................................................................�

14.�Attachments�............................................................................................�

15.�List�of�reviews�..........................................................................................�

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ThyssenKrupp�Metalúrgica�Campo�Limpo�

1.�Purpose��The� purpose� of� this� Manual� is� to� establish� a� system� for� assessing,� selecting,� and� developing�suppliers.��The�system�must�ensure�both�the�quality�and�the�regularity�of�suppliers�with�respect�to�meeting�our�technical�and�commercial�requirements.���2.�Application��The� system� described� in� this� Manual� applies� to� all� companies� supplying� goods� and� services� to�ThyssenKrupp�Metalúrgica�Campo�Limpo�Ltda.,�ThyssenKrupp�Metalúrgica�Santa�Luzia�Ltda.,�and�ThyssenKrupp�Metalúrgica�de�México�S.A.�de�C.V.�in�the�following�areas:��–�Steel�for�forging�and�manufacturing�die�blocks;�–�Suppliers�of�components;�–�Suppliers�of�product-related�services;�–�Equipment�gauging�service�suppliers;�–� Suppliers� of� services� of� machining,� assembling� and� heat� treatment� of� dies� and� forging�accessories;�–�Suppliers�of�services�of�parts�selection,�rework,�and�inspection.��

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3.�Supplier�requirements��The�ratification�of�the�specific�requirements�to�suppliers,�ThyssenKrupp�expectations�and�any�awards�to�suppliers�with�an�emphasis�on�global�performance,�are�presented�and�discussed�periodically,�preferably�every�two�years�through�workshops�suppliers.��3.1.�Safety��Suppliers� are� recommended� to� establish� a� safety� program� that� demonstrates� continuous� and�efficient�efforts�towards�the�reduction�of�accident�rates.�Preferably,�suppliers�should�have�in�place�a�system�that�complies�with�OSHAS�18001�standard.��3.2.�Environment��Suppliers� are� recommended� to� continuously� and� efficiently� improve� their� environmental� condition�based�on�international�standards�for�environmental�management,�such�as�ISO�14001�standard.��3.3.�Compliance�with�legislated�requirements��Suppliers� must� ensure� compliance� with� all� legislated� requirements� applicable� to� their� respective�countries�as�well�as�the�specific�requirements�set�forth�by�both�the�Brazilian�law�and�ThyssenKrupp�internal� rules� concerning� the� safety� of� products,� environmental� protection,� wage� rates,� working�periods,�ban�of�children�labor,�and�occupational�health�and�safety.��3.4.�Quality�system��ThyssenKrupp�Group�expects�all�suppliers�to�implement�and�apply�a�quality�management�system�according�to�the�requirements�of�ISO/TS�16949�-�2009�standard.��The�efficiency�of�the�quality�management�system�will�be�evident�from�the�following:�

-�Continuous�and�proven�improvement�of�processes,�systems,�and�products;�-�Supply�quality;�-�Supply�fidelity;�-�Efficacy�and�readiness�in�taking�corrective�actions;�-�Communication�in�all�levels;�-�Proper�execution�of�new�and�changed�projects�as�regards�the�project�content�and�deadlines.��By� the� quality� management� system,� actions� must� be� oriented� to� the� common� objective� of� zero�defects.�

ThyssenKrupp� reserves� the� right� to� either� audit� the� supplier’s� quality� management� system,�system/processes�and�products�by�itself�or�make�arrangements�for�such�audits�to�be�carried�out�by�third�parties�upon�prior�notice�to�the�supplier.��

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ThyssenKrupp�Metalúrgica�Campo�Limpo�

The�minimum�requirements�respecting�the�Quality�System�for� the�supply�of�products�and�services�are�as�follows:��

Supply�Area� Requirements�

-�Raw�material�for�forging�and�steel�for�tooling�-�Components�and��Product�service�suppliers�

ISO�9001�and/or�ISO�TS�16949�

-�Calibration�service�suppliers� ISO�IEC�17025�

-�Mold�service�suppliers�ISO�9001�or�approval�after�assessment�

-�Suppliers�of�services�of�part�selection,�rework,and���inspection��

Self-assessment�or�assessment�by�TKMCL�

�The�supplier�is�responsible�for�complying�with�and�providing�a�certification�that�their�Quality�Systems�meet�all� the�foregoing�requirements.�The�certification�of�the�quality�management�systems�must�be�approved�by�an�accredited�certification�entity.�The�supplier�has�the�responsibility�top�keep�up�dated�the�certification�information�at�ThyssenKrupp�purchase�area.��3.5.�Quality�goals��As� for� the� measurement� and� assessment� of� the� obtained� quality,� the� supplier�must� define� both�internal� and� external� objectives� related� to� quality.� In� this� context,� the� following� minimum�requirements�apply:��-��Establishment�of�internal�and�external�rates�of�nonconformities�expressed�in�PPM;��-�The�ThyssenKrupp�and�the�supplier�will�agree�upon�quality�objectives�annually�through�to�quality�agreement� based� to� the� products� supplied.� The� aim�will� be� to� achieve� zero� defects� in� the�whole�production�chain.��The�objectives� include� logistic,�commercial,�and�quality�requirements.� If� the�established�objectives�are�not�met�then�an�action�plan�must�be�taken�by�the�supplier�whenever�necessary.���������������

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4.�Communication�procedures�/�homologation�of�new�suppliers��4.1.�Consultation/�quotation��The� ThyssenKrupp� Supply� department� is� responsible� for� contacting/requesting� price� quotations�along�with�relevant�documents�and�information�from�the�supplier.��4.2.�Requirements�and�clarifications�of�documents�from�TKMCL���Certified�Suppliers�of�raw�materials�or�components�as�per�paragraph�3.4�will,�receive�relevant�data�and� information� (drawings,� chemical� compounds� of� materials,� annual� volume,� etc.)� in� order� to�prepare�the�offers.�If�any�data�and/or�information�need�clarifications�or�adjustments,�the�supplier�will�be�responsible�for�promptly�requesting�clarifications�and/or�adjustments�from�ThyssenKrupp.��All�documents�and�information�provided�by�ThyssenKrupp�is�and�will�continue�to�be�Thyssenkrupp�proprietary� and� must� be� treated� by� suppliers� as� confidential� documents.� Suppliers� are� not�authorized� to� release� such� documents� to� third� parties� without� previous� written� authorization� by�ThyssenKrupp.��4.3.�Ensuring�viability�before�the�quotation�preparation��Suppliers�are� responsible� for� ensuring� the� viability�of� supplying� the�product�offered,� including� the�technical� viability� (if� the� product� is� possible� to� be� produced� in� serial� conditions,� according� to�specifications/standards� to� the� process� capability� required)� as� well� as� the� aspects� involving�packaging,�logistic,�quality,�terms,�costs,�etc.��4.4 .�Issuing�quotations��Once� a� quotation� is� received� by� ThyssenKrupp� and� after� its� submission� to� analysis� against� the�quotations� from� other� companies� as� for� the� best� offer� to� be� determined,� ThyssenKrupp,� at� its�exclusive�discretion,�may�schedule�a� visit� to� the�prospective�supplier’s�plant� to�see� its�production�process.�The�assessment�of� the�conditions� is�performed�by� the�ThyssenKrupp�Quality�and�Supply�areas.���������������

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5.�Approval�of�new�suppliers��5.1.�Suppliers�pre-defined�by�customers��Suppliers� defined�by� ThyssenKrupp� customers�must�meet� all� the� requirements� set� forth�by� those�customers�and�are�exempted�from�previous�assessment�since�they�have�already�been�approved�by�a� ThyssenKrupp� customer.� However,� these� suppliers� must� always� comply� with� all� requirements�established�in�this�Manual.�5.2.�Approval�of�new�suppliers��Suppliers� evaluated� favorably� by� the� ThyssenKrupp� Quality� and� Supply� areas� are� requested� to�provide� product� samples� so� that� ThyssenKrupp�may� submit� the� final� product� for� approval� to� the�customer.��Such�request�is�submitted�by�the�ThyssenKrupp�Sales�and�Quality�departments.��Purchase�orders�along�with� the� relevant�monthly�schedule� (Delivery�Schedule)� is�only� issued�after�the�customer�has�been�homologated�/�validated�by�ThyssenKrupp�Customer.�If�the�customer�refuses�to�accept�or�validate�a�new�source,�the�development�will�be�immediately�canceled.���5.2.1.�Suppliers�of�raw�materials�(steel/blocks)�and�components���New�suppliers�may�be�submitted�to�a�new�pre-assessment�through�the�completion�of�the�“Supplier�Assessment�–�Die�shop”�in�order�to�obtain�an�authorization�to�start�up�the�supply�activities.�In�this�case,�either�a�new�on-site�assessment�is�carried�out�by�ThyssenKrupp�or�the�supplier�is�requested�to�complete� a� self-assessment� questionnaire,� depending� on� the� complexity� of� the� product� to� be�developed.��The�new�supplier�will�be�considered�apt�to�start�up�the�development�of�the�process�or�product�only�after� having� received� a� favorable� answer� to� its� self-assessment� questionnaire� from� the�ThyssenKrupp�Quality,�Supply�and�Logistic�areas.��The� supplier� must� comply� with� all� requirements� of� the� quality� system� as� per� paragraph� 3.4.�Suppliers�of�components�and�raw�materials�that�fail�to�comply�with�the�quality�system�requirements�is�only�authorized�to�proceed�with� the�supply�activities�after�a�new�audit�has�been�carried�out� that�shows�the�appropriate�qualification�rates�according�to�the�VDA�6.3�standards.��5.3.�Suppliers�for�the�TKMCL�molding�area��The�supplier�is�submitted�to�a�new�pre-assessment�before�receiving�the�authorization�to�supply.�The�assessment�is�carried�out�in�the�prospective�supplier's�plant�with�the�presence�of�representatives�of�the�ThyssenKrupp�Quality,�Mold�Production�and�Supply�departments.���The�supplier�is�considered�approved�to�supply�only�after�such�assessment�and�analysis�have�been�finished�and�a�favorable�answer�has�been�awarded�from�all�such�areas.������

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6.�Requirements�for�logistics�and�packaging��6.1.�Supplier�logistic�concept��ThyssenKrupp� tends� to�develop�partnership-like� relationships�with�suppliers�and�does�believe� that�the� key� for� success� of� such� relationship� is� based� on� open� communications,� continuous�improvement,� and� teamwork.� As� to� achieve� such� a� goal,� we� leave� it� to� our� suppliers� the� task� of�creating�and�maintaining�mutual�benefits�and�a�supportive�environment�where�both�the�supplier�and�the�customer�are�able�to�succeed.����6.2.�Prompt�response�to�problems��ThyssenKrupp�requires� from�its�partners-suppliers�a� list�of�contacts� including�at� least� the�name�of�the�employee�vested�with�authority� to�deal�with�matters�relative�to�the�ThyssenKrupp�supply�chain�and�that�may�be�located�at�any�time.��6.3.�Material�delivery�schedules��6.3.1.�Electronic�Data�Interchange�-�EDI��ThyssenKrupp�follows�the�recommended�business�practices�for�the�electronic�data�interchange�(EDI),�and�has�a�goal�that�the�suppliers�receive�the�material�delivery�schedules�using�this�system.�Therefore�ThyssenKrupp�recommend�theirs�suppliers�to�adequate�theirs�systems�to�achieve�this�common�objective.���6.3.2.�Planning�rules��–� ThyssenKrupp� compromise� in� making� its� material� delivery� schedules� available� on� weekly� or�fortnightly�basis�(as�established�according�to�with�each�supplier),�thereby�providing�a�planning�view�of�90�days�in�advance.�All�schedules,�adjustments�and�forecasts�will�be�sent�according�the�material�agreement.� Suppliers� are� responsible� for� notifying� the� ThyssenKrupp� material� planner� on� any�problem�including�the�failure�to�receive�the�material�delivery�schedule�on�the�dates�agreed.�–� Increase� or� decrease� of� the� quantities� of� deliverable� items� as� per� the� schedules�must� first� be�mutually�agreed�upon�by�ThyssenKrupp�and�the�supplier.�–�Lot/batch�size�/�minimum�delivery�quantity:�as�established�in�the�material�agreement.��–�Minimum�Stock�Level:�Suppliers�are�recommended�to�maintain�a�minimum�stock�level;�inventory�levels�must�be�mutually�agreed�by�the�parties�in�the�material�agreement.�Suppliers�are�expected�to�maintain� a� minimum� stock� level� available� in� their� plants� to� meet� any� demand� variations� from�ThyssenKrupp�customers.�Stock�levels�must�be�reviewed�every�6�months�and�adjusted�accordingly.�–�Fluctuations:�Demands� from�ThyssenKrupp�customers�may�vary� in�short�periods.�Whenever� the�minimum� stock� level� is� improperly� low� to�meet� a� sudden� increase� in� the� planned� quantities,� the�suppliers�must�promptly�contact�the�ThyssenKrupp�material�planner�so�that�the�proper�action�plan�may�be�prepared.�–�The�Suppliers�compromise� to�delivery� the�orders� firmed�with� the� right�quantity�at� the�scheduled�dates.� If� the� supplier� needs� any� changes,� it’s� mandatory� a� previous� authorization� from�ThyssenKrupp�material�planning�area.��The�supplying�that�doesn’t�match�the�planning�requirements�will�not�be�received�and�the�total�involved�costs�will�be�supplier�responsibility.�

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6.3.3.�Penalties��

ThyssenKrupp� will� not� be� responsible� for� covering� any� additional� costs� associated� with� any�suppliers’� operational� failures� to� supply� according� to� the� established� schedules.� ThyssenKrupp�reserves�the�right�to�debit�from�the�account�of�the�relevant�supplier�any�costs�connected�with�such�failure�to�supply�as�programmed�as�defined�on�item�12.2.��6.3.4.�Production�capacity�increase��As� the� business� volume� of� ThyssenKrupp� growths� further,� reviews� of� the� production� capacity� of�suppliers�will�be�required.���6.3.5.�Advanced�Shipping�Notice�-�ASN��ThyssenKrupp�follows�the�recommended�business�practices�for�the�electronic�data�interchange�(ASN�EDIFACT/RND�Standard),�and�has�a�goal�that�the�suppliers�send�the�electronic�notification�using�this�system.�Therefore�ThyssenKrupp�recommend�theirs�suppliers�to�adequate�theirs�systems�to�achieve�this�common�objective.��The� failure� to� send� ASN� or� to� send� it� incorrectly� will� have� a� negative� impact� on� the� supplier's�performance�indicators.��6.4.�Packaging��6.4.1.�General�requirements���Products� must� be� packed� in� such� a� way� as� to� provide� appropriate� product� protection� against�subsequent�degradation�while�the�product�is�still�under�the�supplier’s�responsibility�or�is�either�being�transported�to�ThyssenKrupp�or�already�stored�in�the�ThyssenKrupp�premises.�The� completion� of� the� form� "Package� Data� Sheet"� (Attachment� 1)� is�mandatory� for� the� approval�process�and�the�completed�form�must�be�submitted�before�its�implementation.�Any�change�required�after� the� approval� awarding� will� cause� the� form� to� be� reviewed� and� a� new� approval� must� be�awarded.�Due� to� environmental� requirements,� all� of� the� ThyssenKrupp� suppliers� must� comply� with�phytosanitary� measures� (NIMF15),� which� bans� the� use� of� any� raw� wood� in� packages� (pallets� or�boxes).�Note:� It� is� the� intention�of�ThyssenKrupp� that�all� its�suppliers�operate�with�packages�according� to�these�determinations.���6.4.2.�Package�identification�labels��Packages�must�be�identified�with�labels�so�as�to�provide�full�traceability�of�ThyssenKrupp�products�from�the�time�the�product�leaves�the�supplier's�plant�up�to�its�the�delivery�for�manufacturing.��6.4.2.1.�Specifications�for�labels��Documents�containing� the� rules� for� the�development,�approval,�and� implementation�of� labels�with�Bar�Code�from�ThyssenKrupp�can�be�requested�to�ThyssenKrupp.�

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Note:� It� is� the� intention�of�ThyssenKrupp� that�all� its�suppliers�operate�with� labels�according� to� the�applicable�specifications.��6.5.�Shipping�/�transport��All�shipping�procedures�must�be�carried�out�by�shippers�and�the�transport�routes�are�determined�by�ThyssenKrupp.��Shipping�instructions�are�defined�in�the�Material�Agreement.��Transport�terms�will�be�considered�as�per�the�Trade�Agreement.���6.6.�Logistic�system�assessment��The�ThyssenKrupp�recommends�that�all�suppliers�of�raw�material�and�components�make�sure�that�their� new� logistic� system� complies� with� the� MMOG-LE� (Master� Global� Material� Management�Operations� Guidelines/Logistics� Evaluation)� system� and� establish� action� plans� for� items� having�direct�impact�on�the�operation�and�the�ThyssenKrupp�specific�requirements.��ThyssenKrupp�reserves�the�right�to�audit�the�supplier’s�logistic�processes. �6.7.�Warehouse�Evaluation Companies� providing� services� for� storage,� inventory�management� and� dispatch� of� ThyssenKrupp�parts�will�be�audited�every�3�years�to�ratify�the�quality�of�the�processes�and�conditions�of�facilities�and�equipment�used.��For�this�evaluation�will�be�used�the�form�"Warehouse�Processes�Audit"�(Attachment�10).

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7.�Development�of�products�and�processes�(raw�material�and�components)��Development� of� products�must� follow� the� requirements� defined� by� AIAG� in� its�manuals,� updated�versions:��–�Advanced�Product�Quality�Planning�(APQP);�–�Product�Production�Approval�Process�(PPAP);�–�Failure�Mode�and�Effect�Analysis�(FMEA),�and�all�other�AIAG�manuals�must�be�used�as�reference.��As�for�steel�suppliers,�the�submission�of�PPAP�is�limited�to�the�manufacturing�process,�material�and�plant,�irrespective�of�the�material�gauge�involved.��As�for�new�or�modified�items,�the�supplier�must�show�the�APQP�schedule�contemplating�the�actions�needed� for� complying� with� the� deadlines,� supplying� samples,� and� starting� up� the� production.�Supplier� must� submit� new� samples� and� relevant� PPAP� documents� for� the� approval� of� both� the�involved�product�and�the�manufacture�process.��Suppliers� are� required� to� submit� PPAP� level� 3,� except� if� otherwise� required�by� the� ThyssenKrupp�Suppliers�Quality�Engineering�area.��Documents�such�as�the�Production�Part�Submission�Report�(Attachment�2),�the�Dimensional�Report�(Attachment� 3)� and� the� Material� Test� Report� (Attachment� 4)� must� be� completed� and� sent� to�ThyssenKrupp�whenever�PPAP�is�requested.�Other�documents�must�follow�the�AIAG�standards.���7.1.�Suppliers�development�in�conjunction�with�the�final�customer��Any� raw�material� or� component� developed� in� conjunction� with� the� final� customer� of� the� product�application�must�be�shared�with�ThyssenKrupp�no�later�than�the�prototype�preparation�phase.�This�directive� aims� at� avoiding� any� project� failures� and� quality� problems.� Above� all,� ThyssenKrupp�reserves�the�right�to�express�its�opinion�on�the�items�that�will�carry�the�ThyssenKrupp�image�to�the�customer.��7.2.�Capability�requirements�for�special�characteristics��Special� characteristics� are� informed� to� suppliers� by�means� of� drawings� and/or� standards.� Some�special� characteristics� may� be� identified� by� the� supplier� himself� during� the� development� of� the�product.��These�characteristics�must�be�incorporated�by�the�supplier�in�his�control�plans�so�that�they�may�be�assessed�by�statistic�methods�according�to�the�requirements�defined�by�AIAG.��Critical�characteristics�must�obtain�ppk�values�above�2.0�at�the�time�of�product�approval�and�a�cpk�value�at�least�above�1.67�during�continued�processes.��Major�or�significant�characteristics�must�have�ppk�values�above�1.67�at�the�time�of�product�approval�and�the�continuous�capability�of�normal�production�process�must�be�higher�than�1.33.��

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If� the� measurement� of� these� characteristics� is� impossible� (e.g.,� destruction� tests)� the� process�parameters� influencing� the�generation�of� the�characteristic�must�be�statistically�determined.� �Such�characteristics�must�be�documented�and�controlled�to�stay�within�the�established�control�limits.�The�capability� of� attributed� characteristics� may� be� demonstrated� by� the� control� of� the� process�parameters.��In�such�cases,�the�attributive�criteria�of�0�ppm�may�also�be�applied.�As�for�samples,�300/0�(to�test�300�with�0�rejection)�method�or�other�rate�as�agreed�with�ThyssenKrupp�is�to�be�used.��As�for�processes�with� instable�or�non-capable�conditions,�a�plan�ensuring�the�compliance�with�the�applicable�specifications�must�be�in�place�(e.g.,�100%�inspection).��7.3.�Requirements�for�traceability�and�document�control��Supplier�must�have� in�place�a� traceability� and� recording�system� that� includes�subcontractors�and�meets�the�needs�of�ThyssenKrupp.�In�case�of�damages�while�using�final�products,�the�supplier�must�be�able�to�demonstrate�by�means�of�records�that�he�has�met�all�the�predetermined�specifications.��7.4.�Data�entering�in�the�IMDS�-�International�Data�System��ThyssenKrupp,� within� its� own� production� chain,� requires� that� suppliers� enter� the� chemicals� and�quantitative�data�in�the�"mdsystem",�including�the�suppliers�of�raw�materials�and�components�used�in�the�manufacture�of�final�products.��Data�must�be�entered�in�the�website�www.mdsystem.com�and�submitted�to�approval�by�ThyssenKrupp�at�ID�5983,�irrespective�of�the�plant�that�is�using�the�product,�along�with�the�documentation�of�the�product�approval�(PPAP).�The�PPAP�approval�is�conditional to�the IMDS�submission.��Data�may�not�be�entered�in�public�websites�since�it�refers�to�confidential�information.��7.5.�Submission�of�samples��7.5.1.�Prototypes��Prototypes�must�be�duly� identified�with� the�"Sample�Submission�Label"� (Attachment�5)�along�with�the�relevant�dimensional�and�material�reports�at�the�time�they�are�delivered.��7.5.2.�Production�Approval�Procedure�–�PPAP�samples��Samples�submitted�to�PPAP�approval�must�be�forwarded�with�all� relevant�documents,�reports�and�statistical�analysis�as�defined�in�the�AIAG�manuals�for�the�Automotive�Industry.��ThyssenKrupp�reserves�the�right�to�follow�up�and�approve�all�standard�300-part�lots�in�the�supplier's�plant.� The� quantity� set� for� a� certain� lot/batch�may� be� adjusted� to� the� convenience� of� the� parties�provided�that�such�adjustment�is�settled�by�mutual�agreement�and�upon�written�communication.��

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At�the�start-up�of�the�production�of�a�new�component�a�differentiate�control�plan�may�be�required�for�the�three�(03)�first�months�of�supply.�If�no�problem�occurs�during�this�trial�period,�the�control�plan�will�return�to�normal�standards.��All�requirements�of�item�7,�"Development�of�Product�and�Process",�and�7.2,�"Requirements�of�capability�for�special�characteristics",�must�be�met.��Samples�must�be�forwarded�duly�documented�and�identified�with�the�"Sample�Submission�Label".��The�samples�that�fail�to�attain�all�stages�of�this�procedure�are�rejected.��7.5.3.�Readiness�audit��After�initial�approval�of�PPAP�samples�and�based�on�the�complexity�of�the�product�and�the�process,�as�well�as�the�risks�involved,�ThyssenKrupp�reserves�the�right�to�carry�out�audits�to�verify�the�actual�installed�capacity�for�the�first�lots/batches�of�the�serial�production�of�an�item.��Readiness�Audit�evaluates�whether�the�outcomes�of�the�manufacture�process�have�met�the�quality�requirements�as�established�by�the�PPAP�documentation�approval�and�production�capacity.��When�such�audits�are�not�carried�out�by�ThyssenKrupp�itself,�the�responsibility�to�audit�will�be�of�the�supplier.�Evidences�of�such�audits�will�be�requested�for�any�future�audits.���7.5.4.�Assessment�of�capability�–�Run�at�Rate��Assessments�of�the�supplier's�supply�capacity�(volume)�may�take�place�in�the�supplier's�plant�in�way�to� identify� bottlenecks� of� each� manufacture� process� operations.� ThyssenKrupp� may� require� an�action�plan�to�be�in�place�to�ensure�that�the�volumes�agreed�will�be�manufactured�as�agreed.��Assessments�are�performed�according�to�the�methodology�as�defined�in�the�"Readiness�Audit"�file,�it�will�be�recommended�by�the�results�of�problems�or�surveys�of�the�process�needs�in�the�monthly�meetings.�The�supplier�is�full�responsible�for�performing�the�process�run-at-rate�analysis.�7.6.�Audit�of�products�and�processes��The� supplier� must� establish� a� regular� system� of� audits� of� the� product� and� process� that� include�manufacturing,� inspections� and� tests,� identification,� preservation,� cleanliness,� packaging,� and�shipping�documents.��The�results�of�such�measurements�must�be�documented�and�the�effectiveness�of�the�measurements�must�be�demonstrated.��7.7.�Inspection�of�lay-outs�and�functional�tests��Suppliers� of� components� must� carry� out� lay-out� inspections� every� 2� � years,� which� include�inspections�of�the�specifications�set�in�the�product�drawings,�either�dimensional�or�metallurgical,�or�those� referring� to� applicable� tests.� Records� of� these� inspections�must� be� sent� to� ThyssenKrupp.�Parts� which� the� final� application� involve� the� Customers� GM,� Ford,� MIM� e� DaimlerChrysler,� must�submit�the�lay�out�inspection�in�an�annual�basis.�

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7.8.�Requirements�for�special�processes��7.8.1.�Heat�treatment�process��Heat� and� surface� treats�must� comply�with� the�CQI-9� standards� (Heat�Treat�System�Assessment).��The�supplier�will�be�the�full�responsible�for�auditing�such�process�on�an�annual�basis�and�to�send�the�audit� with� the� action� plan� to� Thyssenkrupp.� This� requirement� is� extended� to� include� the� services�supplied�by�subcontractors.��ThyssenKrupp�reserves�the�right�to�review�the�audit�documents�whenever�needed.��7.8.2.�Superficial�treatments�process���The�superficial�treatments�processes�must�comply�with�the�CQI-11�and�CQI12�standards�(Plating�System�Assessment/Coating�System�Assessment).��The�supplier�will�be�the�full�responsible�for�auditing�such�processes�on�an�annual�basis�and�to�send�the�audit�with�the�action�plan�to�Thyssenkrupp.�This�requirement�is�extended�to�include�the�services�supplied�by�subcontractors.��ThyssenKrupp�reserves�the�right�to�review�the�audit�documents�whenever�needed.�����������������������������

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8.�Process�and�product�changes��Every� process� modification� must� be� communicated� to� ThyssenKrupp� to� consider� whether� new�samples�must�be�submitted.�The�applicable�requirements�in�item�7�must�be�met�in�case�of�process�changes.�The�Supplier�Quality�area�is�responsible�for�informing�the�items�that�are�applicable�to�each�case.���Whenever�products�are�changed� the�supplier�must�submit�new�samples�and�PPAP�documents� for�approval�of�both�the�product�and�the�manufacture�process.��ThyssenKrupp� requests� that� the� communication� of� these�processes�be�done� as� soon�as�possible�since�the�changes�may�imply�the�submission�of�new�samples�to�the�final�customer.���9.�Approving�deviations�/�rework��The� supply� of� products� with� small� deviations� from� the� specifications� will� only� be� accepted� upon�formal�application�sent� to�ThyssenKrupp�using� the�“Concession� Request� Authorization”� form�(Attachment�8).�The�document�must�be�prepared�and�forwarded�in�advance�to�the�Supplier�Quality�area� and�must� show� the� following� information:� the� quantity� involved� or� the� period� of� supply,� the�causes�of�the�problem�and�actions�to�be�taken�to�avoid�recurrences.�The�same�procedure�applies�whenever� reworks�not�mentioned� in� the�approved�process�are� to�be�performed,� which� may� cause� damage� to� the� use� of� the� product� or� may� cause� any� lose� to� the�manufacture�process�within�ThyssenKrupp.��

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10.�Assessment�system�for�components�and�raw�materials�suppliers��This�assessment�aims�at�continuously�improving�ThyssenKrupp�suppliers�as�it�allows�the�generation�of� information� that� show� the� actual� performance� of� suppliers� in� a� way� that� orient� improvement�actions� as�much�as� recognize� suppliers�with�better�Technical/Business�potential,� thus�helping� the�development�of�new�businesses.��Suppliers�that�provide�parts�to�more�than�one�Thyssenkrupp�plant�will�have�a�global�assessment.��Suppliers� are� evaluated� on� the� basis� of� Commercial,� Logistics� and� Quality� requirements� by� the�following�rates:��Global�Supplier�Performance�(GSP):�This�rate�expresses�the�global�capacity�of�a�supplier�to�meet�commercial,� logistics,� and� quality� requirements,� describing� the� ThyssenKrupp's� degree� of�satisfaction.��Quality�Performance�(QP)�This�rate�expresses�the�Quality�of�the�product�supplied�on�the�basis�of�the�record�of�quality�related�to�the�products�delivered�and�during�the�use�thereof�in�the�manufacture�process.��Quality�System�Rate�(QSR)�This� rate� expresses� the� status� of� the� certification� of� the� supplier's� Quality� System� as� regards� to�ThyssenKrupp�requirements.��Delivery�Performance�(DP)�This�rate�expresses�the�level�of�the�supplier’s�compliance�with�delivery�terms.���Customer�Care�(CC)�This� rate� expresses� the� business� behavior� among� companies� against� the� expectations� of�ThyssenKrupp.����10.1.�Supplier�assessment�system�goals��The�goals�set�by�ThyssenKrupp�are�described�as�follows:��

Assessment�Rates� Targets�

GSP-�Global��Supplier�Performance� >�95�

QP��-�Quality�Performance� 100�

QSR-�Quality�System�Rate�� >�90�

DP��-�Delivery�Performance� 100�

CC��-�Customer�Care� >90�

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10.1.1.�Quality�Performance�(QP)��This�rate�expresses�the�quality�rate�calculated�on�the�basis�of�the�records�of�product�delivery�dates.�The�quality�of�the�lots/batches�supplied�may�be�assessed�either�at�the�time�of�the�delivery�inspection�or�during�the�use�of�the�product�in�the�manufacture�process.���Suppliers�with� supply�problems�directly�affecting� the�ThyssenKrupp�production� lines�must�provide�an�action�plan�to�correct�nonconformities�immediately�after�formal�communication�of�the�problem.� Suppliers�are�rated�on�the�basis�of�the�QP�result�as�per�the�following�table:��

Quality�Performance�� Classification��

100� Excellent�

90�to�99.9� Good�

80�to�89.9� Satisfactory�

60�to�79.9� Insufficient�

Below�60� Inadequate�

�10.1.1.1.�QP�calculation�method�for�raw�material�and�component�suppliers��QP�=�Inspections�Results�(IR)�x�0.2�+�SCARS�x�0.5�+�PPM�x�0.3���Where:�Inspections� Results� (IR)� =� the� score� average� obtained� from� the� product� lots/batches� supplied�based�on�the�inspections�results��

AP��=�Approved�lot��������������������=�100�AL�=�Approved�lot�with�Alert�����=���80�AC�=�Conditioned�Approved�lot�=��50�RJ�=�Rejected�lot�����������������������=��20�

SCARS�=�Score�based�on�the�number�of�“Supplier�Corrective�Action�Request”�issued�due�problems�found�at�the�delivery�of�the�product,�during�the�production,�or�on�the�customer's�site.�

No#�of�Complains�� Score�

0� 100�

1�� 90�

2� 80�

3�to�4�� 50�

5�or�above� 1�

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PPM�=�A�score�based�on�the�number�of�parts�with�problems�identified�at�the�delivery�inspection�or�during�the�manufacture�process,�with�the�amount�expressed�in�ppm�(part�per�million),�which�is�attributed�as�a�demerit�to�the�supplier�for�the�month.���Criteria�for�components:��

PPM� Score�

0� 100�

1�to�100� 98�

101�to�199� 95�

200�to�399� 80�

400�to�800� 70�

>�800� 50�

�Criteria�for�raw�material:�

Forging�PPM�

Machining�PPM�

Score�

100� 0� 100�

200� 100� 98�

400� 200� 95�

800� 400� 90�

1000� 800� 80�

>1000� >800� 70�

�Note:�Maximum�values�per�range.�PPM�calculated�using�a�supply�weight�bases.�The�lower�score�between�machining�and�forging�will�be�given.��

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10.1.2.�Quality�System�Rate�(QSR)��ThyssenKrupp�requires�from�its�suppliers�that�they�are�certificated�by�external�entities�as�per�table�in�item�3.4�and�reserves�the�right�to�perform�audits�in�the�supplier's�facilities�if�deemed�necessary.��The�supplier�must�show�actions�to�achieve�third�part�certifications�related�to�the�Quality�System,�Safety�and�Environment�

�ThyssenKrupp�may� purchase� from� non-certificated� suppliers� if� so� authorized� by� its� customers� or�after�a�process�audit�has�performed�pursuant�to�VDA-6.3.��The�score�of�the�QSR�is�based�on�the�supplier�third�party�certifications�as�defined�bellow:�

Certification�requirements�

Quality�System�Rate�

100� 95� 90� 85� 80� 70�

ISO/TS�16949� X� X� X� X� � � � � �

ISO�9001� � � � � X� X� X� X� �

ISO�14001� X� X� � � X� X� � � �

OHSAS�18001� X� � X� � X� � X� � �

VDA-6.3� � � � � � � � � X�

�Follow�the�classification:�

Quality�System�Rate� Classification�

95�to�100� Excellent�

90� Great�

80�to�85� Good�

70� Acceptable�

10.1.2.1.�VDA-6.3�process�audits���Suppliers�of�both�components�and�raw�material�may�be�audited�pursuant�to�the�VDA�6.3�standard�in�the�following�cases:�–�Suppliers�failed�to�meet�the�Quality�System�requirements.�When�a�score�above�or�equal�to�72�is�

obtained�and�a�compatible�action�plan�in�actually�in�place�the�supplier�will�be�consider�approved�to�supply.�

–�Necessity�raised�during�the�supplier�performance�monthly�meeting�–�Suppliers�with�a�high�level�of�problems�or�with�a�problem�with�a�magnitude�that�may�cause�serious�

damages�to�the�ThyssenKrupp�internal�production�processes�or�any�other�type�of�damage�to�the�final�customer.�In�such�cases,�the�QSR�score�that�was�initially�established�may�be�changed�by�the�score�awarded�by�the�audit.�

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–�Strategic�suppliers�audited�according�to�the�internal�audit�plan.�The�supplier�must�show�an�action�plan�for�the�problems�found.�

�The� suppliers� will� be� classified� in� 3� categories� according� the� VDA� 6.3� adherence.� They� will� be�evaluated�according�the�frequency�interval�described�on�the�table�bellow:��

VDA�6.3–�Global�attendance�degree�(%)� Classification� Frequency�(years)��

92�up�to�100� A� 3�

82�up�to�91,9� B� 2�

72�up�to��81,9� C� 1�

�The�Supplier�QSR�which�the�VDA�audit�classification�result�is�B�or�C�will�be�replaced�to�the�VDA�audit�score.��ThyssenKrupp�reserves�the�right�to�evaluate�new�suppliers�before�sending�the�first�purchase�order.��A� VDA� 6.3� self� assessment� can� be� performed� instead� of� Thyssenkrupp� audit,� except� when�established�in�the�customer�specific�requirements.�I�such�cases,�the�classification�will�be�maximum�“B”�no�matter�the�score.�A�new�self�assessment�must�be�performed�each�2�years��10.1.3.�Delivery�Performance�(DP)��The� measurement� of� the� supplier's� level� of� compliance� with� the� delivery� terms� expresses� his�commitment�to�the�terms�agreed�(quantity�and�time).�ThyssenKrupp�requires�from�suppliers�an�on-time�delivery�performance�of�100%.����������������������������DP�=�Weighted�average�of�all�materials�delivered�in�a�month��Suppliers� with� delivery� problems� directly� affecting� the� ThyssenKrupp� production�must� provide� an�action�plan�immediately�after�the�formal�communication�of�the�non-conformities.��Once�a�month�ThyssenKrupp�reviews�the�on-time�delivery�indicators�and�requests�corrective�actions�from�suppliers,�as�needed.��Suppliers�are�ranked�according�to�the�table�below:��

Delivery�Performance�(DP)� Classification��

100� Excellent�

95�to�99.9� Good�

90�to�94.9� Satisfactory�

bellow�90� Inadequate�

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10.1.4.�Customer�Care�(CC)��A�system�that�establishes�on�a�monthly�basis�the�ThyssenKrupp's�satisfaction�level�with�the�factors�mentioned� below� for� the� Customer-Supplier� relationship.� The� scores� are� given� by� the� several�ThyssenKrupp�internal�areas.��A.�Problem-solving�efficiency�in�Logistics�issues��B.�Delivery�conditions�(packages,�identification,�transport�and�documents)�C.�Problem-solving�efficiency�in�Quality�issues�D.�Pro-active�attitude�in�the�commercial�relationship�E.�Price.��Customer�care�(CC)�=�sum�of�the�individuals�items��Suppliers�are�ranked�according�to�the�following�table:��

Customer�Care�(CC)� Classification��

90�to�100� Excellent�

80�to�89.9� Good�

70�to�79.9� Satisfactory�

below�70� Inadequate�

��10.1.5.�Global�Supplier�Performance�(GSP)��The� Global� Supplier's� Performance� (GSP)� is� found� by� combining� the� Commercial,� Logistic� and�Quality� performance� indicators.� The� score� so� obtained� allows� ThyssenKrupp� to� rank� suppliers�according�to�their�capacities�and�the�ThyssenKrupp�level�of�satisfaction:�����������������������GSP�=�(QP�x�0,40��+��QSR��x�0,20�+��DP�x�0,20���+���CC�x�0,20)�

�Suppliers�are�ranked�for�GSP�according�to�the�table�below:��

Global�Supplier�Performance��� Classification��

95�to�100� Excellent�

85�to�94.9� Good�

75�to�84.9� Satisfactory�

below�75� Inadequate�

���

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10.2.�Assessment�of�Global�Supplier�Performance�(GSP)��

Every� month,� suppliers� are� informed� on� their� respective� performance� by� the� "Global� Supplier�Performance�Report"�(Attachment�6),�which�is�forwarded�by�the�ThyssenKrupp�Supply�area.��ThyssenKrupp�reviews�on�a�monthly�basis�each�supplier's�GSP�scores�in�the�supplier�performance�evaluation�meetings.�Suppliers�with� the�GSP�score�below�85�can�be�asked�show�to�ThyssenKrupp�the� performance� improvement� actions� to� be� used� to� cope� with� the� problem.� This� assessment� is�based�as�much�on�the�QP,�DP,�and�CC�indicators�as�on�the�supplier's�relevant�records.���When�the�GSP�score�is�below�85�and�a�decreasing�trend�can�be�noted�within�a�period�of�or�above�three� (3)� consecutive� months,� an� audit� will� be� carried� out� by� the� Quality� area� as� per� VDA-6.3�standards.�The�supplier�must�show�an�official�action�plan�for�correcting�any�nonconformity.��As�for�suppliers�with�GSP�score�below�75�for�a�period�longer�than�three�(3)�consecutive�months�or�for� five� (5)� times� in� the� same� year,� ThyssenKrupp� Purchase� area� will� begin� developing� a� new,�alternative�source.� In�case� that� the�supplier�has�been� indicated�by�a�ThyssenKrupp�customer,� the�customer�will�be�notified�on�the�performance�inappropriately�low�of�the�supplier�and�the�need�for�the�development�of�a�new�source.��Audits�for�additional�processes�may�be�defined�in�the�monthly�supplier�performance�meetings�as�a�result�of�the�quality�problems�found.���

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11.�Assessment�system�for�suppliers�of�machining,�mounting,�and�molds�heat�treat�services�and�forging�accessories���11.1.�Quality�Performance�(QP)�calculation�method�for�molding�area�suppliers��

Suppliers�of�tooling�services�are�assessed�according�to�the�quality�performance�on�a�monthly�basis.�This�assessment�is�used�to�define�the�suppliers�with�the�best�technical/commercial�potential�and�the�developments�of�future�businesses.��As�for�this�segment,�the�Quality�Performance�(QP)�is�calculated�on�the�basis�of�the�product�delivery�records.�The�quality�of� the� lot/batch�supplied�may�be�assessed�either�at� the�delivery� inspection�or�during�the�use�of�the�product�in�the�manufacture�process.����������������������QP�=�“the�average�of�the�scores�awarded�to�supplied�batches"��Score�for�each�technical�report:�

�AP���=�Approved�lot��������������������=�100�AL��=�Approved�lot�with�Alert������=��80���AC���=�Conditioned�Approved�lot�=��50��RJ���=�Rejected�lot�����������������������=��20�

�Once�a�month�ThyssenKrupp�releases�the�results�of�the�rank�to�suppliers.��11.2.�Quality�Supply�Documents��Suppliers�must�send�a�completed� "Inspection�Report"�along�with� the�product�supplied.�The�report�must�show�the�specifications�and�the�values�found�in�all�measured�characteristics�of�the�items.�This�report�will�be�kept�for�retrieval�at�any�time�and�as�an�instrument�for�comparing�the�measures�found�by�the�supplier�and�those�found�by�ThyssenKrupp.�If�the�report�is�not�sent�to�ThyssenKrupp,�this�will�be�counted�as�a�demerit�to�the�supplier.��11.3.�Heat�treatment�assessment��Suppliers�of�heat-treated�products�must�carry�out�an�annual�audit�of�the�heat�process�as�per�CQI-9�(Heat�Treat�System�Assessment)�standards.�An�action�plan�must�be�established� for�noncompliant�items.�ThyssenKrupp�reserves�the�right�to�request�the�audit�records�whenever�necessary.�

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12.�Supply�problems��Actions� will� be� required� to� be� taken� by� the� supplier� whenever� products� fail� to� comply� with� the�ThyssenKrupp�specifications.��When� a� “Supplier� Corrective� Action� Request”� (Attachment� 7)� is� opened,� the� supplier� will� be�responsible� for� identifying� the� cause(s)� of� the� nonconformity� and� officially� communicate� the�corrective�action�to�be�taken�to�eliminate�any�possibility�of�recurrences.��Suppliers�must�provide�a�reply�within�twenty-four�(24)�hours�whereby�the�analysis�and�containment�actions�used� to� limit� the�problem�within� the�ThyssenKrupp�site,� the�parts� in� transit,�and� the�parts�stored�in�the�supplier's�premises�must�be�described.��Suppliers� will� have� a� period� of� five� (5)� working� days� to� communicate� ThyssenKrupp� about� the�corrective� actions� to� be� taken� in� order� to� avoid� recurrences� and� the� terms� and� responsible�individuals� for� each� action.� � The� reply� must� be� forwarded� in� the� same� format� as� the� “Supplier�Corrective� Action� Request”� document� so� as� to� allow� the� reply� content� to� be� entered� into� the�ThyssenKrupp�SAP�system.��After� implementing� the� actions� as� defined� in� the� “Supplier� Corrective� Action� Request”,� suppliers�must�document�material�evidences�(pictures,�worksheets,�meeting�minutes,�etc.)�that�show�that�the�problem�has�been�contained�so�that�the�action�taken�may�be�verified�and�the�report�closing�analysis�may�be�finished.��ThyssenKrupp�reserves�the�right�to�carry�out�inspections�on�the�supplier's�site�if�judged�necessary.��In�case�of�warranty�problems,�line�stopping�or�any�other�serious�issue,�ThyssenKrupp�reserves�the�right�to�communicate�the�Supplier�Certifications�Body�involved.��12.1.�Containment�plan���Should�any�problem�occur�ThyssenKrupp�reserves�the�right�to�apply�the�Level�1�Controlled�Shipment�procedures�(CS1:�Pro-active�Containment)�to�be�performed�by�the�supplier;�Level�2�(CS2:�Reactive�Containment)�to�be�performed�within�ThyssenKrupp�premises�by�outsourced�specialized�companies,�and�any�release�of�products�will�be�ThyssenKrupp�responsibility.��Any�costs�inherent�to�containment�operations�will�be�at�the�expense�of�the�supplier�so�as�to�ensure�the�conformity�of�the�delivered�components.���Suppliers�are�officially� informed�on� the�criteria� for� the�application�of� the�procedures�as�well�as�the�duration�of�them.��If� the� CS1� and� CS2� containment� actions� reveal� insufficient� to� ensure� conformity� of� the� delivered�products�with�ThyssenKrupp�specifications,� the�supplier�will�not�be�considered�for�new�businesses�with�ThyssenKrupp�until�he�has�set�an�efficient�action�plan�is�put�in�place�and�the�non�conformities�are�definitively�resolved.����

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Exhausted� all� possibilities,� if� the� supplier� demonstrate� no� been� able� to� resolve� effectively� the�reported�non�conformity,�it�will�be�disqualified�for�supplying�the�product�or�service.��Containment� actions� within� the� customer's� site� or� warehouse�may� be� conducted� by� third� parties�without� previous� evaluation� when� the� third� party� has� been� indicated� by� the� customer� or� its�qualifications�can�be�demonstrated�by�the�results�of�similar�services.�In�these�cases�a�ThyssenKrupp�representative�will�be�designated�to�coordinate�the�involved�work.���12.2.�Costs�recovery��The� costs� involved� in� any� line� stopping,� rework,� selections� and� all� other� costs� associated� with�noncompliant�materials�will�be�timely�compensated�by�the�supplier�to�ThyssenKrupp.��The�supplier�will�be�informed�about�the�costs�involved�thought�the�document�“Pre�Alert�Debit�Note”�(Attachment�9).�It’s�supplier�responsibility�to�send�back�the�document�to�Thyssenkrupp�in�5�days.�In�case� Thyssenkrupp� does� not� receive� the� document,� it� will� be� considered� that� the� debit� was�automatically�accepted.��13.�Supportive�documents��Suppliers�are� required� to�use� the�documents� listed�below�as�a� reference� to� implement� the�Quality�System:��-�Quality�System�Requirements�as�per�ISO�TS�16949�and/or�ISO�9001�-�ISO�IEC�for�Suppliers�of�Measurement�Equipment�Gauging�Services�-�Control�Plan�and�Advanced�Product�Quality�Planning�Manual�(APQP/�AIAG)�-�Production�Part�Approval�Process�(PPAP/AIAG)�-�Measurement�System�Analysis�Manual�(MSA/AIAG)�-�Statistical�Process�Control�Manual�(SPC/AIAG)�-�Failure�Mode�and�Effect�Analysis�Manual�(FMEA/AIAG)�-�CQI-9�-�Heat�Treat�System�Assessment�-�CQI-11�-�Plating�System�Assessment��-�CQI-12�-�Coating�System�Assessment��-�MMOG/LE�-�Master�Global�Materials�Management�Operations�Guidelines/Logistics�Evaluation���

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14.�Attachments.��

Attachment�1�

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Attachment�2��

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Attachment�3��

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Attachment�4��

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Attachment�5��

��

Attachment�6��

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Attachment�7��

��

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��

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Attachment�8��

��

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Attachment�9��

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Attachment�10��

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15.�List�of�reviews��

REV� DATE� ITEM� PAGE�

00� Jan/08� New�entire�revision.� All�

01� Apr/10� 3.4.�Included�supplier�responsibility�for�Certifications�up�dated�information� 6�

7.4�included�that�PPAP��approval�is�conditional�to�IMDS�submission� 13�

10/10.1.3.�Included�Global�assessment�and�quantity�requirements�for�Delivery�indicator�

16�/�20�

10.1.2.�Changed�the�QSR�evaluation�criteria,�considering�the�third�part�certifications�as�score�parameter�

19�

12.�Included�the�communication�to�the�Certification�Bodies�in�case�of�serious�problems�

24�

12.2.�Included�criteria�for�costs�recovery�“Pre�Alert�Debit�Note”� 25�

02� Sept/10� 3.4.�Up�dated�information�regarding�ISO�TS16949�revision.� 6�

7.7.�Redefined�the�layout�inspection�frequency.� 14�

7.8.2.�Established�requirement�for�superficial�treatments,�plating�and�coating�according�CQI�11�and�CQI12�and�annual�self�assessment.�

15�

10.1.2.1.�Included�the�VDA�6.3�classification�and�audit�frequency.� 19/20/21�

03� May/11� Including�6.7.�Warehouse�Evaluation� 12�