Controversial supplier contract purchasing terms adopted by General Motors last year, will be changed by the automobile manufacturer after suppliers say that the terms expose them to greater warranty liability. Although the new terms and conditions applied to only new purchase contracts, supplier executives and attorneys said they were uncomfortable with elements of the new contract. The new terms and conditions extended the automaker’s rights giving GM more authority to recover warranty and safety recall costs, to acquire suppliers’ intellectual property rights, and to access their financial information.

Don Walker, a key member of the supplier council, said the changes initiated by GM last year raised suspicions among suppliers. Even though GM executives insisted that there were no ulterior motives, leading suppliers felt the changes left too much room for interpretation, leading them to believe the worst of GM’s intentions.

General Motors Vice President of Global Purchasing and Supply, Grace Lieblein admitted that GM made a mistake last year when they revised the terms and conditions without input from suppliers. She said the new revised terms and conditions will take effect on new contracts as soon as suppliers have had time to review the changes and offer feedback.