QUALITY AGREEMENT - page1/4
QUALITY AGREEMENT No. ../2005
Between the following Parties:
MOTORPAL a.s.
Strojírenská 9
587 22 Jihlava, CZ
Czech Republic
(hereinafter only the Customer)
and
(hereinafter only the Producer)
1. INTRODUCTION
The Contractual Partners’ common objective is constant betterment of the quality and reliability of products. This may only be achieved through continuous improvement of cooperation between individual production levels and implementation of quality management systems.
Qualitative aims: Identification of non-conformities in assembly + claims 0 km 200 PPM
The Producer is fully responsible, as part of “product liability”, for the quality and safety of delivered products.
Products are understood to be parts and materials delivered by the Producer, as well as services provided by the Producer.
2. ASSURANCE OF QUALITY BY THE PRODUCER
In order to ensure adequate quality of the products delivered to MOTORPAL a.s. the Producer undertakes to introduce, implement, and follow quality management systems that meet the following conditions:
- EN ISO 9001 / QS 9000 / VDA 6.1 /ISO TS 16949
- Statistical process control (SPC)
The Producer assumes sole responsibility for planning, organizing, and implementing production processes and quality assurance, so that comprehensive quality control, proper quality management, and adherence to product quality requirements are ensured.
During quality audits conducted by the Customer at the Producer’s site, the Producer undertakes to provide the Customer with information concerning the organizational setup of quality management and quality assurance, work safety, and protection of the environment. Furthermore, the Producer undertakes to answer all questions concerning quality assurance asked during process audits.
The Producer undertakes to allow the Customer’s representative to access to the site so that they may inspect the degree of product quality assurance.
The Producer is responsible for organizing, maintaining, and filing quality system documentation (VDA 1).
All documents concerning the quality system are required to be kept on file for 5 years; mandatory documentation on certain components or brands (D-parts) are subject to the obligation of archiving for 15 years. The Producer is obliged, at the Customer’s request, to allow examination of these documents and allow the representatives to enter its production centers.
The Customer shall announce the time of the next inspection well in advance.
3. VERIFICATION OF FIRST SAMPLES
Release of parts for series production shall be subject to the Customer’s prior approval of the first samples in accordance with VDA 2 or compliance with PPAP requirements (approval of parts for production). The Customer shall determine the presentation stage of PPAP for each concrete product.
The samples delivered by the Producer must be produced under series production conditions and must be delivered in the agreed-upon quantity in specially marked packaging.
The first sample record, the Producer shall record the results of measuring and testing of all the dimensions and parameters specified in the drawing documentation and notify the Customer of any and all non-conformities found.
Release and approval of first samples shall take place, on the part of the Customer after approval of the samples by the Customer’s end customer.
The Producer, using the drawing documentation delivered, shall draw up a Process Development Diagram, Process FMEA, and a Control Plan, where the control and regulatory activities on all levels of the production process will be described. This Control Plan is subject to the Customer’s approval.
For each product delivered, the Customer shall draw up a Product Quality Plan which shall form an inseparable part of this Quality Agreement.
4. SERIES DELIVERIES
The products that the Producer manufactures must meet the relevant specifications, standards, drawings, and regulations.
The Producer is obliged to point out all uncertainties or potentially wrongly defined aspects in the materials submitted.
Whenever identifying non-conformity, the Customer shall notify the Producer of this circumstance and, beginning from the next delivery, entry control (TK) shall be renewed at the Customer’s site.
The Producer undertakes to adhere to the approved Control Plan and Product Quality Plan throughout series production.
If detecting product non-conformity to the Contractual drawing documentation, the Producer shall notify the Customer of this circumstance without undue delay
Approval of deviations from the Contractual specifications shall be admissible solely with the Customer’s written approval, at the supplier’s request.
The Producer confirms to have a strategy set up for dealing with all kinds of emergency scenarios, so that continuation of deliveries is not in jeopardy.
5. CLAIMS
5.1. Instant Measures Following Non-conformity Detection
In the event that product non-conformity is detected, the Customer shall notify the Producer of this circumstance using a “Report of Non-conformity“. The Producer undertakes to take the following measures, immediately upon obtaining a Report of Non-conformity:
-Analyze the cause of the non-conformity and inform the Customer, within 24 hours upon obtaining the Report of Non-conformity, using a 8D Report or “Standpoint to Non-conformity“, on the instant remedial measures taken;
-Request the Customer’s approval of the remedial measures proposed;
-Analyze the non-conformity and sort out the inventory in stock at the Customer’s with the of the Producer’s representatives of competence;
-Replace, subject to technical feasibility (within 24 hours after obtaining the Report of Non-conformity), with conforming products; the substitute delivery shall be duly tested and marked; the marking shall confirm the substitute delivery to be containing conformity products only; the mode of marking such deliveries is to be negotiated withthe Customer;
-All non-conforming products and products suspected to be non-conforming shall be separated from conforming products in the production process and warehouse, and visibly marked accordingly;
-Provide the Customer with all the documentation allowing the non-conformity to be traced and located retrospectively;
-Follow all the testing and controlling measures ensuring deliveries of conforming products; these measures shall be followed until the cause of non-conformity is eliminated and throughout the subsequent trial period; duration of the trial period is to be agreed upon withthe Customer.
5.1.1.Critical qualitative non-conformity
Critical qualitative non-conformity is considered to be, in particular:
-Suspension of production atMOTORPAL a.s., thereby putting deliveries to the Customer in jeopardy;
-Claim from a customer of MOTORPAL a.s. – 0 km
-Claim under warranty on the part of the product’s end user;
-Additional costs incurred toMOTORPAL a.s., in connection with removal of a non-conformity;
-Reduced product safety for the end user.
5.2. Remedial Measures
5.2.1 Preventive Measures
In the event that non-conformity is identified, the Producer undertakes to take instant remedial measures within 1 week upon receiving the Report of Non-conformity and take supplementary remedial measures preventing reoccurrence of identical non-conformity. The Producer shall have these preventive measures approved by the Quality Dept. of MOTORPAL a.s.
The preventive remedial measures, submitted in the form of an 8D Report, must contain at least:
-information on the results of non-conformity identification and subsequent cause analysis;
-measures to eliminate the non-conformity - Poka Yoke, tool/form adjustment, etc.
-technical measures complementing the solutions proposed;
-assignment of persons responsible for implementation of each remedial measure;
-scheduling the timing for each remedial measure;
-mode of verifying the effectiveness of the measures taken.
5.2.2. Provisory/Preliminary Measures
In the event that no action plan could be completed, i.e., 8D Report specifying thepreventive remedial measures to be taken, before the next delivery to the Customer, or it is not possible as yet to follow the proposed remedial measure, the Producer shall propose a provisory/preliminary solution until a definitive preventive measure can be worked out and followed.
5.3. Joint Problem Solving
In the event that the Customer so requests, a joint team comprising representatives of the Customer and the Producer shall be formed to analyze the cause of the given non-conformity. This team shall jointly work on the problem until the cause of the problem is identified and eliminated.
The Producer’s representative in the team is competent to approve the record of the analysis on behalf of the Producer. The team shall work at the Producer or Customer’s site, as deemed necessary.
The objective of the team’s work is to identify the share of responsibility for non-conformity on the part of the Producer and Customer. A report shall be written on the result of the team’s work, to be countersigned by the representatives of both parties.
6.THE PRODUCER’S SHARE OF RESPONSIBILITY IN THE EVENT OF NON-CONFORMITY
6.1.Principle
Without prejudice to the Producer’s responsibility and liability arising from the order, Purchase Contract, and other warranty provisions, the Producer shall be liable for all losses caused by a delivery of non-conforming products. |The scope of the Producer’s liability shall be determined as follows:
6.2The Customer’s Expenses, Especially for Removal of Non-conformity
The Producer’s liability for losses applies in particular to:
- Flat fee for expenses related to claim processing: CZK 600.00;
-Additional costs of extra work, sorting out, reworking, and repairing of non-forming products delivered to the Customer;
-Additional costs related to replacement (dismounting and assembly) of final product caused by delivery of non-conforming products;
-Losses accountable to suspension of production on the part of the Customer;
-Additional costs for special shipping/transport, if necessary to prevent higher losses;
-Damages to tools and production means on the part of the Customer caused by delivery of non-conforming of products.
6.3 Third-Party Losses
The Producer’s product liability applies also to losses that third parties may claim from the Customer, e.g.:
-Losses that the Producer causes to the automobile industry;
-Losses incurred by the dealer and/or end user due to product recall.
In the above cases, the Producer undertakes to indemnify the Customer for compensation paid to the end customer.
- CONSTANT IMPROVEMENT
The Producer undertakes to apply the principles of constant improvement of products, processes, and systems, in particular, with respect to:
-Costs optimizing;
-Waste reduction (scrap, extra work, error duplication)
-Interval reduction;
-Stock reduction;
-Better exploitation of facilities;
-Tool adjustment optimizing, etc.
The concept of constant improvement applies especially to preventive and remedial measures and the added-value improvement principle (PDCA).
- THE CONTRACTUAL EFFECTIVE PERIOD
This Quality Agreement comes into force upon countersignature and remains in effect for an indeterminate time.
This Agreement may be cancelled with a 6-month cancellation period.
Delivery contracts signed before the coming into effect of this Agreement shall prevail, without affecting their respective agreed-upon provisions, during the effective period of this Agreement and thereafter.
On behalf of: MOTORPAL a.s.
Name: Ing. Jiří Mrázek
Function:The Director of Quality Department
Tel: +420 567 132 238
Fax: +420 567 132 535
E-mail:
Date: ………………………… Signature: …………………………….
On behalf of :
Name:
Function:
Tel:
Fax:
E-mail:
Date: ………………………… Signature: ………………………….….