Supplier Quality, Logistics and Materials Manual. Supplier Quality, Logistics, and Materials Manual

Transcription

1 , and Materials Manual Page 1 of 31

2 Table of Contents Section 1 Introduction 1 Scope Page 4 2 Purpose Page 4 3 Quality Policy Page 4 4 Facilities Page 4 5 Definitions Page 5 Section 2 Quality Expectations and Requirements 6 APQP Requirements Page 6 7 Special Characteristics (SC s) Page 7 8 PPAP Requirements Page 7 9 Charge Backs Page Containment Page Controlled Shipping level 1 and 2 Page Safe Launch Page Continuous Improvement Page Visitors Page 13 Page 2 of 31

3 Section 3 Logistics and Materials Management Requirements 15 Packaging Page Labeling Page EDI Page Terms of Delivery Page Cost of Noncompliance Page Delivery and Packaging Page Title and Cost of Goods Page Obsolescence Page NAFTA Page Control of Records Page 22 Appendix Quality Problem Notice Form Delivery Problem Notice Form Supplier Contact Information Form Container Shipping Label Example Master Shipping Label Example Supplier Packaging Approval Sheet Page 3 of 31

4 Section 1 1) Scope The requirements defined in the, applies to all suppliers of production parts / materials and/or services to Piston Automotive manufacturing plants. 2) Purpose The purpose of this Global, is to specify the Piston Automotive quality system and materials management requirements for our suppliers. These requirements extend from supplier qualification to new product development and past model service production. 3) Quality Policies Piston Automotive quality policy is Satisfy our Customers, Empower our People. This summarizes Piston Automotive s position that Customer Satisfaction can only be achieved if they are placed first in priority and that employees are empowered to take positive action to achieve customer satisfaction. Piston Automotive is also committed to the ISO Environmental Standard. 4) Facilities We comply with all customer and regulatory requirements We are committed to continual improvement We are ISO certified We are TS Piston Automotive has five manufacturing facilities; the corporate headquarters is located in Redford, MI. The addresses are: Headquarters: Page 4 of 31

5 12723 Telegraph Road Redford, MI Main Phone: Main Fax: Manufacturing: Telegraph Road Redford, MI Main Phone: Main Fax: Michigan Avenue Detroit, MI Main Phone: Main Fax: Technology Drive Building 55 Jefferson Town, KY Main Phone: Main Fax: East Alexis Road Toledo, OH Main Phone: Main Fax: Warren Street North Kansas City, MO Main Phone: Main Fax: ) Definitions Non-Directed Suppliers: A supplier that is sourced and managed by Piston Automotive Page 5 of 31

6 Bailed Supplier: A supplier that is sourced and managed by the OEM Directed MPA: A supplier that is sourced and managed by the OEM in partnership with Piston Automotive Directed Non-MPA: A supplier that is sourced by the OEM and managed by Piston Automotive Section 2 6) APQP Requirements Non Directed, Directed Non-MPA & Directed w/mpa The supplier will utilize the AIAG Advanced Product Quality Planning (APQP) Process and will communicate and track status to program milestones as required by the Piston Automotive Program Manager and communicated by a Piston Automotive buyer. The Supplier must follow the five (5) phases within APQP. They are as follows: 1) Plan and Define Program 2) Product Design and Development Verification 3) Process Design and Development Verification 4) Product and Process Validation and Production Feedback 5) Launch, Assessment & Corrective Action Suppliers will provide appropriate support for product development initiatives including MSA, DFMEA (when required), PFMEA, process flow, control plans, lessons learned, etc. at Piston Automotive and Customer facilities. Each Supplier is responsible for providing product to Piston Automotive at a targeted incoming defective rate of zero (0) PPM. Suppliers are responsible to analyze all warranty and quality issues using a root cause 5-why, 8D and other structured problem solving method. If required, the Supplier is responsible for participating in Quality reviews with Piston Automotive management. It is expected that 100% of the Suppliers Date Universal Numbering System (DUNS) number, International Material Data Sheet (IMDS) and Production Part Approval Submissions (PPAP) will be on time and complete per the AIAG and Piston Automotive requirements as defined in this manual, and/or any other written agreement. Page 6 of 31

7 Suppliers must link their IMDS to Piston Automotives IMDS number. The Piston Automotives IMDS number is Suppliers must meet the following process capability requirements: Ppk > 1.67 on all significant (special) characteristics prior to Phase III PPAP and Cpk > 1.33 on all special characteristics after Phase III PPAP. The Supplier is responsible for all laboratory testing as determined by the Supplier, Piston Automotive and/or the Customer. The testing results included in the PPAP submissions must include the proper laboratory accreditation documentation. Suppliers with heat treated material must provide AIAG documentation CQ1-9 assessment that has been performed by a 2 nd party. 6A) Process Changes Non Directed & Directed Non-MPA All process changes must be approved by Piston Automotive Quality Department prior to implementation. Purchasing and Quality will review the request, approving or rejecting at their discretion. If a drawing change is required, the Engineering Change Notice (ECN) process will start and the Supplier will await a new drawing before proceeding with the change. In any circumstance, the Supplier must wait for approval from Piston Automotive before proceeding with any change. Adequate notice must be provided prior to change of the process. Complete PPAP Level 3 documentation is required as the reevaluation document for all Piston Automotive designed production parts. The Supplier must submit a timeline to the Quality Department detailing the timing required to make the process change. 7) Special Characteristics (SC s & CC s) SC s and CC s are print features that must be more closely monitored and controlled in the Supplier s process compared to the other part features. All SC s and CC s must be identified on the Supplier s PPAP documentation. SC s and CC s will be defined on the Piston Automotive/Customer s print. Control of SC s and CC s will be reviewed in the APQP process with the team. These control methods are considered formally agreed upon when the Supplier receives full PPAP approval. Occasionally, Piston Automotive or its Customer(s) may require that the Supplier submit more frequent capability studies or SPC data. Specific SC s and CC s may be identified on individual basis. If SC s and CC s are not specified, the Supplier is responsible for contacting the Piston Automotive Quality Department for direction prior to PPAP submission. 8) PPAP Requirements Non Directed, Directed Non-MPA & Directed w/ MPA The Supplier is responsible for Production Part Approval Process (PPAP) submissions and all associated activities and parts required for achieving PPAP approval. Unless otherwise notified by a Quality Representative, an onsite Process Audit will be conducted prior to PPAP submissions. PPAP requirements will be determined with your Piston Automotive Quality Representative and documented on a PPAP checklist. Page 7 of 31

8 The Supplier is required to use a process to establish and optimize the production manufacturing process (demonstrated at the Process Audit) that meets or exceeds quality and delivery requirements in the most efficient way possible. The Supplier is responsible for on-going data collection and capability studies of the SC s and CC s. That data must be used as predictive indicators of the manufacturing process consistent with the control plan. The Supplier is responsible to have a current (less than one year old) Capacity Analysis Report (CAR) available if requested by Piston Automotive. PPAP approval from Piston Automotive does not constitute approval of immediate shipment of a new product or revision of parts. Once the Supplier is provided PPAP approval, time is often required for Piston Automotive to obtain approval from its customer. Once a release has been sent, the Supplier has the authority to ship. Milestone dates will be established between all parties. 8A) PPAP Requirements & Delivery - Non Directed, Directed Non-MPA & Directed w/mpa All Piston Automotive Supplier PPAP submissions should be delivered to the Quality Department on or before their due date. Piston Automotive requires its Suppliers to follow the PPAP Checklist as defined by the Quality Department. A PPAP checklist must be used when preparing a PPAP package and included when submitted (if required by the Quality Representative) to ensure that all the Piston Automotive PPAP requirements will be met. All PPAP submissions are required to be level 3, unless otherwise agreed upon. There may be requirements beyond the scope of the AIAG PPAP manual due to a request from Piston Automotive s Customer. Once PPAP is submitted, the Piston Automotive Quality Representative will review the documents to ensure all the required information is there by phase and checklist. The PPAP package will also be reviewed for accuracy and that the current revision level documents are being used. Once the Piston Automotive s Quality Representative has made the determination to accept or not accept, an will be sent to inform the Supplier if the all the requirements have or have not been met. Piston Automotive will then keep an electronic copy of all said documents. If the Supplier is self-certifying (Q1), they will not need Customer Representative sign off on the PPAP documents. PSW must state that they are Q1. If the Supplier is not self-certifying (Q1), the Supplier must have Customer Representative sign off on PPAP documents prior to submitting to Piston Automotive. Piston Automotive s Quality Department may issue to the Supplier a provisional/interim PPAP approval. A provisional PPAP approval is not a full PPAP approval; an interim PPAP approval allows a Supplier to ship product on request as long as the OEM specific alert process is followed and completed. However, the interim approval indicates a documentation update or some other corrective action is required. The Supplier must submit the missing documents or make corrections immediately or as required per the deadline given to them by the Piston Automotive Quality Representative. Page 8 of 31

9 8B) Dimensional Results 1) The Supplier shall report all dimensional results in the same unit of measurement as specified on the drawing. 2) PPAP samples shall be identified as master samples submitted for full layout inspection. If parts are made in a multi-cavity tool, different cavities shall be identified. 3) Supplier shall include the drawing with dimensional results 4) The Supplier must provide a 100% dimensional layout inspection and functional testing at a minimum of once per year. 8C) Sample Product At Piston Automotive s discretion the Supplier shall submit six (6) sample parts with 100% dimensional inspection, unless otherwise specified by the Quality Representative. Those parts must be clearly labeled and coordinated with reports. When destructive testing has to be performed to conduct 100% dimensional measurement, elements of the same sample must be clearly labeled. 8D) Material, Performance & Durability Test Results 1) All laboratory data shall be less than one (1) year old at the time of the initial submission 2) All laboratory data shall be from on outside-accredited laboratory or the Supplier internal laboratory with a copy of the ISO17025 (or national equivalent) certification and internal Lab Scope included in the submission 3) The Lab Test Report or the AIAG Test Report shall state the exact specification from the drawing 4) The lab report and/or certification shall be verified for the conformant to the specification by the Supplier and include a stamp or handwritten evidence of this verification. 5) The Supplier shall report all results in the same unit of measurement as specified on the drawing. 8E) Control Plans The Supplier shall submit a pre-launch control plan along with the production control plan with all initial submissions in AIAG format. 8F) Capability Studies The Supplier shall submit an initial process capability study for all SC s and CC s as specified in the control plan. Any exceptions shall require a signed documented agreement with the Customer engineering and quality approvals. Criteria: Ppk > If this cannot be met, 100% inspection is required until the criteria have been met. Page 9 of 31

10 8G) Measurement Systems Analysis The Supplier shall submit a Gage R&R study for all equipment used to perform the initial process capability study. This includes measurement equipment, gages and fixtures. Gage R&R studies shall be performed on planned production parts. If this cannot be met, 100% inspection is required. 8H) Run at Rate Information When required by Piston Automotive and/or the Quality Department, suppliers must submit a run at rate summary sheet with their PPAP submission. The Supplier will be required to use the OEM specific required form. The Supplier is required to notify Piston Automotive prior to execution of the run at rate trial. Piston Automotive Purchasing and the Quality Department may visit the Supplier to view the run at rate. 8I) Quality Problem Notice (QPN) In the event that a Supplier ships non-conforming material, the material will be rejected and a QPN will be issued to the Supplier. Piston Automotive will notify the Supplier via . The Supplier must submit an initial corrective action to the Piston Automotive Quality Representative within 24 hours of receipt. The Supplier must then submit an 8-D corrective action report to the Quality Representative within 10 business days. The Supplier must include the identification of all potential root causes, mistake proof techniques and revisions to the PFMEA, control plan, process flow documents and work instructions. It is at the Piston Automotive s Quality Representatives discretion to request a Supplier visit for the evaluation of the effectiveness of the corrective action(s). QPN s can be disputed up to fifteen (15) calendar days after issuance. Any Supplier that has had any QPN or DPN (see Cost of Delivery Noncompliance ) activity during the month will receive a scorecard. All Suppliers will receive their scorecard at the end of the year. The scorecard represents the Supplier s performance in quality, delivery, quality systems and corrective action responsiveness. The Supplier s performance status could be used to identify areas to focus continuous improvement efforts. CATEGORY POSSIBLE SCORE Product Quality 50 Delivery 20 Quality System 15 Page 10 of 31

11 Corrective Action 15 Reference Piston Automotives procedure QCOP-01 Supplier Management Section through ) Charge Backs - Non Directed & Directed Non-MPA A Supplier s defective part may cause scrap, sorting, Piston Automotive Customer returns, and/or charge backs. These are all examples of the costs of poor quality. If it is determined that a Supplier s defective part(s) is the root cause of these additional costs of poor quality, the Supplier may have their account debited to cover these costs. If the component is found to be defective, Piston Automotive will return the material to the Supplier upon receipt of a returned material authorization number (RMA). However, Piston Automotive reserves the right to commence the rework or sort process, the cost of which will be charged back to the Supplier. If the Supplier s defective material causes Piston Automotive s Customer to scrap or rework, then the cost of the scrap or rework may be debited from the Supplier s next payment. If the Supplier s defective material causes Piston Automotive s Customer to issue a debit to Piston Automotive, then this amount may be debited from the Supplier s next payment. This includes the costs of sorts conducted by Piston Automotive s Customer at their location and any fines they impose. If Piston Automotive personnel are required to travel to a Customer facility due to a quality issue resulting from the Supplier s defective material, then all travel expenses relating to the trip and problem resolution may be debited from the Supplier s next payment. The examples above are not all inclusive. Piston Automotive reserves the right to debit all costs resulting from its Suppliers providing defective material, including premium freight. 9A) Review of Problem Solving Methods Suppliers are required to complete and submit an 8-D root cause analysis to the Quality Representative for each QPN. Additionally, Suppliers may be required to present and review their documents with the Piston Automotive management team via web conference or on site at Piston Automotive or Customer location. The number of QPN s issued to a Supplier per month, severity of the occurrence, and Supplier responsiveness will be the criteria used to determine if a Supplier must participate in the reviews and if they are categorized as a critical Supplier. Reviews will be held as needed. The Piston Automotive Quality Department will notify the Supplier s Quality Department if the Supplier is required to attend this review. Supplier representatives at these meetings must have the technical and operational knowledge required to answer and explain the details of the 8D. 10) Containment Page 11 of 31

12 All suppliers are obligated to notify Piston Automotive if they ship non PPAP parts to any Piston Automotive facility without an alert, parts found to be out of specification or any engineering standards failure. Containment is required when a QPN has been issued for a product concern to assure that a quality management system is established. The Supplier shall implement effective controls to contain the problem at their facility. This would include all inventories at the Piston Automotive facility, the Supplier s facility and any product in transit. The Supplier shall determine these controls. During containment, the primary urgent objective is to quickly identify and segregate all suspect material without interrupting production. Where sorting is required, all Suppliers personnel (direct or indirect) shall be properly trained to perform the sort, have any necessary gages, have written procedures as well as have and wear appropriate safety protection. The product that is in containment shall utilize a certification label/sticker identifying the reason for the containment. The label/sticker shall indicate that the product has been determined to be 100% defect free. At a minimum this label/sticker should include part number, quantity, and date shipped and visible on all four (4) side of the container. Piston Automotive may reject shipments received without the proper identification. 11) Controlled Shipping 11A) Controlled Shipping Level 1 (CS1) is required when the Supplier s current controls have not proven sufficient to protect Piston Automotive from the receipt of nonconforming product, Piston Automotive has been placed on CS1 due to a defect of the Supplier s product, or the nonconformance is a safety concern. The Supplier shall implement a redundant inspection process at the Supplier s facility and submit a containment plan. 11B) Controlled Shipping Level 2 (CS2) is required when the Supplier s CS1 current controls have not proven sufficient to protect Piston Automotive from the receipt of nonconforming product. The Supplier is responsible to promptly inform Piston Automotive of CS2 status. The Supplier will have inspection performed by an impartial third party to inspect product prior to shipment. The Supplier shall be required to attend a meeting at Piston Automotive to present containment actions and root cause analysis. CS2 may automatically place a non-directed Supplier on New Business Hold. The third party is selected by the Supplier, approved by Piston Automotive, and paid for by the Supplier. 12) Safe Launch Containment Safe Launch containment is to be used for all pre-production and production parts that require PPAP approval. Safe Launch Containment requires a Pre-Production Control Plan that is a significant enhancement to the Supplier s production control plan and raises the confidence level to ensure that all products shipped will meet Page 12 of 31

13 Piston Automotive s requirements. The Pre-Production Control Plan will also serve to validate the production control plan. The Pre-Launch Control Plan should take into consideration all known critical conditions of the part as well as potential areas of concern identified during PPAP. The Supplier must create and update the Safe Launch checklist as required. This document should include any potential issues. Please note that all barcodes will follow the AIAG or Customer format. The barcodes must be listed in the control plan and process documents. The purpose is to: 1) Validate the Supplier s production control plan. 2) Protect our assembly and manufacturing facilities from quality non-conformances during critical periods. 3) Document the Supplier s efforts to verify control of its processes during start-up, acceleration, after revisions to the manufacturing process, or when manufacturing runs are separated by three (3) months or more. 4) Ensure that any quality issues that may arise are quickly identified, contained, and corrected at the Supplier s location. The Supplier shall: A. Safe Launch Process: Establish a validation process that contains the following elements: 1) Identify the staff person responsible for ensuring the development and implementation of the verification process. 2) Implement early production containment with entry date, exit criteria, and exit date as defined by Piston Automotive. 3) Establish early production containment stations, which must be off-line, separate, and an independent check from the normal manufacturing process and located at the end of the process. 4) Train personnel relative to the standardized work performed at the Safe Launch containment areas. 5) Establish a reaction plan for a single defect. 6) Implement an audit process of the Safe Launch containment, utilizing levels of management to ensure conformance to the Pre-Launch Control Plan B. Duration of Safe Launch: Safe Launch must be implemented for a period of time or quantity of parts as specified by Piston Automotive or until the Production Control Plan has been validated, whichever is longer. If time or quantity is not specified, Safe Launch inspection will remain in effect 90 days post Job 1 or minimum of 5,000 units shipped, whichever comes first without any major disruption. Major disruption is identified as any significant downtime incurred by Piston due to shipment of nonconforming product. If the supplier is unable to meet the exit criteria or the Supplier s Safe Launch plan continues to identify non-conformances, the Supplier shall continue the necessary containment measures to protect Piston Automotive. Once the quality concerns have been resolved to the satisfaction of both the Supplier and Piston Automotive as well as the Supplier s Production Control Plan is validated they may exit Safe Launch status. The Supplier will be eligible to exit Safe Launch after validating the effectiveness of the Process Control Plan and meeting the criteria listed below. Page 13 of 31

14 1) Ship the number of pieces required to meet production requirements as specified by Piston Automotive for the Safe Launch period with no problems identified in the early production containment by Piston Automotive. If time or quantity is not specified, the period of time is 90 days post Job 1 or minimum of 5,000 units shipped, whichever comes first without any major disruption. Major disruption is identified as any significant downtime incurred by Piston due to shipment of nonconforming product. 2) If a problem is identified in Safe Launch by Piston Automotive, early production containment must remain in effect for a minimum of 2 weeks after implementation of the corrective action or through the original Safe Launch containment period, whichever is longer. 3) If the Safe Launch continues to identify non-conformances, the plan must be kept in place until process controls and capabilities have proven effective and the Production Control Plan is validated. Failure to execute a Safe Launch plan may result in Controlled Shipping Level 2 (CS2) by third party sort/containment company and other possible consequences. 13) Continuous Improvement Suppliers are expected to complete and submit the Supplier Self-Assessment form annually. This form will be sent via in the first quarter of every year. The supplier has until the fourth quarter to submit the completed form back to the Supplier Quality Engineer. Suppliers to Piston Automotive are expected to drive continuous improvement activities throughout the whole organization. Besides the basic standards of high level housekeeping (5S) or similar, Visual Management, Error Proofing tools and good problem solving methods, it is also recommended to implement and maintain a Lean Manufacturing philosophy. Supplier performance will be updated monthly. 14) Visitor Requirements Non Piston Automotive Employees All visitors (including on-site Supplier representatives) must sign in and out when entering and leaving the Piston Automotive facility. All visitors must have a Piston Automotive escort to be on the production lines and unauthorized areas. All visitors must wear any and all required PPE. This includes, but limited to safety glasses and safety vests in designated areas. No vendor shall remove any parts from any Piston Automotive facility without proper Piston Automotive authorization. If for any reason parts need to be removed from the facility please contact your Piston Automotive Materials Manager. Section 3 Page 14 of 31

15 15) Packaging Suppliers are responsible for shipping quality acceptable packaging and parts to the point of use within the Piston Automotive receiving facility. All packaging shall be considered a contractual obligation and be approved by the affected Piston manufacturing plant, with assistance and coordinated through Piston Automotive Packaging Engineer/Program Management. Any deviations shall have written approval prior to implementation. Piston encourages supplier initiated packaging improvement ideas before or after launch. Piston Automotive Packaging Approval Sheet(s) or OEM equivalent shall be submitted and approved during the pre-production phase and the Production Part Approval Process (PPAP). Suppliers proposed packaging should involve selecting containers that maximize density, meet Piston Automotive general requirements and reduce non-value added packaging materials and motions for the Piston Automotive production team members. All Suppliers must have emergency expendable packaging backup planned prior to start of production. 15A) Environment Packaging systems shall be designed and engineered for handling, transportation and storage conditions/environments. Temperatures ranging from -30F to +150F (-34.4C to +65.6C) and humidity conditions up to 95%. Duration is determined by Supplier and Piston Automotive receiving plant. 15B) Dangerous Goods/Hazardous Materials Packaging, marking, labeling and shipment of dangerous goods (hazardous materials) shall comply with applicable Federal and international regulations governing the transport of dangerous goods. Reference: 49CFR Part C) Material Handling Manually handled containers should not exceed 16 kilograms / 35 pounds. Mechanically handled loads should not exceed 1,000 kilograms / 2204 pounds. For deviations, consult with the receiving plant as variations may exist depending on material handling methods and assembly process 15D) Supplier Test Shipment A test shipment may be requested for the following instances: Page 15 of 31

16 1) Change of part, packaging or shipping method 2) New parts (coordinated with pre-production builds) 3) New Supplier 4) As deemed necessary Each test shipment shall be coordinated and approved with the Packaging Engineer and the receiving Piston Automotive Plant prior to being shipped. Each test shipment shall be clearly labeled on all four sides as a Test Shipment and marked to the attention of a specific contact person (including phone number) at that facility. It is recommended that orange paper be used for these labels. Receiving Piston Automotive locations shall be notified of a test shipment when tendered so they can be on the lookout for the shipment before it arrives. Test shipment quantities may or may not be included in the regular Piston Automotive scheduled delivery. 15E) Ergonomics In addition to the 16 kg / 35 lb. weight limit for any manually handled containers, these containers should have the following dimensions: Length - Should be no longer than 76 cm / 30 long Width - Should be no longer than 51 cm / 20 wide Height - Recommended maximum from bottom of container to handholds is 46 cm / 18. However, if oversized containers (manually handled) are needed, the following ergonomic criteria shall be followed: Oversized for only length or width dimension Maximum weight limit of 13.6 kg / 30 lbs. (lower maximum weight due to less optimal arm position to grasp container handles) 15F) Supplier Packaging Approval Sheet The Piston Automotive Supplier Packaging Approval Sheet or OEM equivalent form is required to ensure efficient packaging and transportation at the start of delivery. It is used to collect packaging data for production parts. Suppliers shall complete and submit the Supplier Packaging Approval Sheet for approval during the Pre-Production Phase and the Production Part Approval Process (PPAP). The sheets are required for new production parts, new suppliers, changes to parts or changes to packaging. The Piston Automotive receiving plant may request changes to supplier proposed packaging prior to approval. Page 16 of 31

17 15G) Pallets Packaging failure is often attributed to poorly constructed or poorly sized pallets. Pallet selection should be according to the following guidelines: All pallets should be new or reconditioned, and can be either corrugated or wood, depending on the load and transportation mode(s). The shipment of wood pallets shall comply with the regulations for the country of destination. All recycled pallets must be inspected for damage prior to use and repaired as required. Pallet size should be selected to maximize cubic efficiency for the intended mode(s) of transportation. Consult with the Piston Packaging Engineer and/or receiving plant to determine transportation mode(s) and preferred pallet size. All wooden pallets, boxes and containers must be in compliance with ISPM15 guidelines PREFERRED PALLET DIMENSIONS LENGTH WIDTH 1000 mm 1200 mm 1140 mm 1140 mm 800 mm 1200 mm (fasteners footprint) 1140 mm 960 mm 15H) Expendable Containers Expendable containers shall be completely filled with parts to minimize transportation costs and to prevent collapsing due to excessive voids. Container sizes should be designed to be modular to the standard size pallet to be used for shipping. The use of half slotted containers (HSC) with covers, or common covers is recommended when practical for the product, volume and distribution environment. Hand-holds should be considered for manually handled containers. For containers designed to ship dangerous goods / hazardous materials, the UN Specification Packaging markings must be stamped or printed on the container. Reference: 49CFR Part 173 Page 17 of 31

18 For transportation within North America, corrugated containers should be stamped with a box manufacturer s certificate as defined in Rule 41 of the Uniform Freight Classification or item of the National Motor Freight Classification Expendable containers shall have sufficient vertical strength to support unit load stacking and maintain pack integrity throughout the distribution system. Unit loads shall withstand stacking to 2684 mm / 106" in transit. For overseas shipments, containers should be constructed with water-resistant adhesive to withstand extreme humidity/moisture conditions. 15I) Fasteners Standard container styles for fasteners include Regular Slotted Containers (RSC), with inner liner when necessary or Full-Telescope Half-Slotted Boxes (FTHS). Maximum pallet load height should not exceed 838 mm / 33 inches. Fastener carton sizes should be modular to the preferred fastener pallet size: 813 mm / 32 x 762 mm / J) Unit Load Pattern Containers shall be palletized in full layers only. When container quantities are insufficient to complete one full palletized layer, the additional containers may be consolidated onto a mixed load pallet with approval from the receiving location. Pyramiding shall not be acceptable for multiple pallets in the same shipment. Containers shall be columnar or vertically stacked one box directly on top of another. Interlocking or brick stacking shall not be acceptable due to a loss of 40% to 60% of compression strength of the corrugated containers. Brick stacking is only allowed for bags on pallets. Box overhang shall not be acceptable due to a loss of 20% to 40% of compression strength and the potential for damage in transit. Banding or Stretch wrap should be used to secure the load to the pallet. Using just one or the other helps to reduce disposal and recycling costs. Both may be used when necessary to secure the load and prevent shifting during transit. Page 18 of 31

19 Non-metallic strapping (polyester or polypropylene) shall be used due the safety hazards associated with metallic strapping. The exception is for castings, sheet metal, or as approved by the receiving Piston plant. Edge protectors or angle boards shall be used when sheer/sharp edges are exposed on the metallic straps. A minimum of two bands in the length and width dimensions shall be used for multiple containers on a pallet. Fusing straps or crimp seals should be used to secure the banding. Buckles shall not be used. Banding shall be located clear of notched fork openings. 16) Labeling All boxes, containers and pallets must be labeled to ensure proper identification and verification of the product and the quantity shipped. Bar-code labels are required and must be visible from opposite side. The location of the Piston Automotive facility will define the type of bar coding to be on the label (Odette, VDA, ANSI, AIAG, etc.). The Supplier is responsible for obtaining approval for the label prior to shipments to a Piston Automotive facility. Suppliers are required to properly identify shipments/containers that contain new model parts, prototype parts, trial parts and engineering changes. New model parts must have a new model label. All other special parts must use the standard Piston Automotive Stop Sign label. These labels must be present on at least, but not limited to, 3 sides of each individual container. 16A) Most Common Label Issues Container label: 1) Missing lot information Piston Automotives label specifications require a lot number on the shipping container label. The lot number on the label is up to the supplier to determine. 2) Incorrect part number The barcode for the part number must mirror the part as it is sent in the 830/862 release. If the part number in the release contains hyphens then so must the barcode. 3) Incorrect or missing vendor code Master label: Vendor code on the label must match the vendor code sent on the 830/862 release. Page 19 of 31

20 1) Master label usage A master label should be used for material shipped in multiple containers on one pallet. Master labels are not required for single containers 16B) Shipping Label Scan 1) Mandatory fields for scanning shipping labels: 17) EDI- Electronic Data Interchange Part number Quantity Supplier Code assigned by Piston Automotive Lot number Serial number Piston Automotive utilizes EDI in all of its facilities for scheduling releasing requirements and forecast. Suppliers are required to use EDI and must verity the EDI connection between their facility and the Piston Automotive supplied plant prior to PPAP. Unless specifically approved by Piston Automotive Management. 17A) EDI Specifications It is expected all suppliers will exchange EDI documents with Piston Automotive. X12 EDI specifications can be found at: Piston sends the following EDI documents in the X format: 824, 830, 862 and 997 Piston receives the following EDI documents in the X format: 856 and 997 For the suppliers who cannot exchange EDI in the X12 format Piston offers EDIFACT 97A If the supplier does not have EDI capability an EDI service bureau can be used Piston Automotive approved service bureaus: Advance Technologies Service Bureau J-COM 17B) EDI Service Bureau Contact Information Page 20 of 31

21 Advanced Technologies Service Bureau contact info: Julie Simon EDI Supervisor phone fax J-Com contact info: phone fax 18) Terms of Delivery Refer to the Purchase Order 19) Cost of Delivery Noncompliance The Supplier is responsible for any and all costs associated with a failure to meet delivery requirements. This will be managed through our DPN (Delivery Problem Notice) procedure. Piston Automotive will notify the Supplier via of any DPN s that are issued. If required, the Supplier must submit an initial corrective action to the Piston Automotive Materials Representative within 24 hours of receipt. Any Supplier that has had any DPN activity during the month will receive a scorecard. All Suppliers will receive one at the end of the year. The scorecard represents the Supplier s performance in quality, delivery, quality systems and corrective action responsiveness. The Supplier s performance status could be used to identify areas to focus continuous improvement efforts. CATEGORY POSSIBLE SCORE Product Quality 50 Delivery 20 Page 21 of 31

22 Quality System 15 Corrective Action 15 Reference Piston Automotives procedure QCOP-01 Supplier Management Section through Examples of DPNs include, but are not limited to the following material issues: 1) Supplier past due 2) Supplier caused late shipment or missed window time 3) Missing or incorrect ASN 4) Missing or incorrect packing list or bill of lading 5) Missing or incorrect labels 6) Non-conforming labels 7) Short shipment 8) Over shipment 9) Incorrect packaging 10) Supplier ships in nonstandard/non approved mode 11) Supplier caused premium freight 12) Production line stoppage, either at Piston or customer location due to supplier delivery issue 20) Delivery Suppliers shall ensure 100% on-time shipment of all products and services. Schedule changes can occur from our Customers; therefore changes in schedules to our Suppliers are not uncommon and must be accommodated to ensure flow of materials. Piston Automotive will provide Suppliers with forecast and planning information with as much advance notice as possible of any/all changes to schedules or delivery requirements. It is the Suppliers responsibility to contact the appropriate Piston Automotive Plant Materials contact by phone and if an updated daily /weekly production release has not been received or cannot be met in full. The Supplier is responsible for any and all costs associated with failure to do so. This will be managed through our DPN procedure (Delivery Problem Notice). 20A) Receiving/Shipping Hours Page 22 of 31

23 All Piston Automotive facilities have normal hours dedicated for shipping and receiving product. Suppliers should contact XPO Logistics or Piston Automotive personnel at the receiving Piston Automotive facility to confirm shipping and receiving hours. Suppliers are required to obtain approval from Piston Automotive prior to any schedule changes. 20B) Loading Trucks and Transport Suppliers are responsible for loading trucks and for ensuring the containers and product are properly secured prior to delivery. Securing loads includes the use of any necessary locking devices, shipping straps, blocks, etc. required to ensure the containers or product do not shift and become damaged during transport. Suppliers shall verify the truck does not have any damage that could allow product to get damaged or allow contamination. Unless otherwise directed, suppliers are required to use Piston Automotive directed carriers. Suppliers are required to contact Piston s Third Party Logistics provider, XPO, at SCPISTONOPS@xpo.com or call (24/7) to arrange shipments based on the current release. For truckload shipments, suppliers must fully load and maximize the entire trailer by weight or cube measure (depending on product weight) provided the Piston release quantity allows. The supplier must notify the Third Party Logistics provider and Piston prior to shipment of any off-standard loading methods that are used due to the capability of the trailer or truck or damage to the trailer or truck that prevents normal loading. Failure to follow these stated guidelines could result in a DPN or debit memo for excess or damaged freight. 20C) Shipping Document Requirements The following fields are minimum requirements for supplier shipping documents: 1) Piston assigned vendor code / Supplier Name 2) Carrier Name 3) Packing Slip Number 4) Part Number 5) Purchase Order number 6) Part Quantity Shipped 7) Unit of Measure 8) Containers shipped 9) Shipment Date 10) YTD Accumulative 11) Description Dimensions of Container Page 23 of 31

24 12) Shipment Class (if LTL) 13) Pieces per container 20D) Raw/FAB Authorization For truckload shipments, Suppliers must make a best effort to completely fill the truck however; the Supplier is not to exceed the FAB cum authorization on their latest release without written authorization from the Piston Automotive Materials team. Any receipts(s) in excess of the FAB authorization is considered an over shipment and the Supplier can be issued a DPN (Deliver Problem Notice) with a minimum charge of $ An RMA may also be requested to return the material at the supplier s cost. It is the Supplier s responsibility to notify and reconcile with Piston Automotive of a cum disagreement as soon as it is noticed. If you should have any questions, please contact your Piston Automotive Materials Analyst. 21) Title and Control of Goods Refer to the Purchase Order 22) Obsolescence Suppliers are expected to build and deliver product adhering to the material release and scheduling requirements provided by Piston Automotive, unless otherwise agreed upon. Any obsolescence resulting from a Supplier failing to adhere to the release and schedule requirements will be the responsibility of the Supplier including any associated cost. For obsolescence that occurs due to measure beyond the control of Supplier; claims, supporting documentation and information must be presented to the Piston Automotive Materials Department for review. For directed Suppliers, claims may be required to be filed direct to the Customer/OEM. Refer to OEM requirements and/or contract. Claims are subject to audits and must be held in safe storage until the claim is settled. 23) NAFTA (US, Canada, and Mexico Suppliers) Canada, Mexico and the United States established a uniform Certificate of Origin to certify goods imported into their territories qualify for the preferential treatment accorded by NAFTA. The Certificate of Origin must be completed and signed by the exporter of the goods; where the exporter is not the producer; the exporter may complete the Certificate on the basis of Page 24 of 31

25 1) Knowledge that all good originate 2) Reasonable reliance on the producer s written representation that the good originates; or a completed and signed Certificate of Origin for the goods Suppliers must in compliance with the US, Canada and Mexico Customs regulations and requirements including completion of annual NAFTA Certificate or Origin for all parts supplied to North America. Issuing a Certificate of Origin (COO) carries legal consequences; so Suppliers that are not certain about how this applies to product they supply should contact the US Customs NAFTA facts line at (972) or the Mexico Customs at ( ). Suppliers can also obtain information at the following website: Piston Automotive utilizes the service FOCUS BUSINESS SOLUTIONS for documents required for NAFTA. 24) Control of Records and Retention Suppliers shall define the method for controlling records. Production part approvals, tooling records, purchase orders and amendments shall be maintained for the length of time of that part (or family of parts) is active for production and service requirements plus one calendar year. Page 25 of 31

26 Appendix Quality Problem Notice (QPN) Form Page 26 of 31

27 Delivery Problem Notice Form Page 27 of 31

28 Supplier Contact Information Form Page 28 of 31

29 Container Shipping Label Example Master Shipping Label Example Page 29 of 31

30 Supplier Packaging Approval Sheet Page 30 of 31

31 REVISION DATE REVISION LEVEL DESCRIPTION OF REVISION 9/14/2016 Initial Release into new PBMS format and into PLEX. Page 31 of 31