Tier 1 suppliers and OEMs are tightening quality requirements across the automotive industry. Many Tier 2 and Tier 3 suppliers still rely on ISO 9001, but IATF 16949 certification is increasingly becoming the ticket to larger contracts. For suppliers seeking growth, certification is not just about compliance—it’s about opportunity. With DQS, suppliers have a trusted partner to make the move from ISO 9001 to IATF certification.
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Opening Doors: How IATF Certification Helps Tier 2 & 3 Suppliers Win New Business
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Why Certification Matters for Tier 2 & 3 Suppliers
On a global scale, IATF Oversight reports show there are over 102,000 IATF-certified sites worldwide, with Asia–Pacific accounting for ~79% and North America (U.S. and Mexico combined) only ~6.22%. This highlights both the momentum of certification worldwide and the opportunity for Tier 2 and Tier 3 suppliers in the U.S. and Mexico to close the gap and secure stronger positions in global supply chains.
Beyond recognition, IATF certification strengthens partnerships, enhances operational discipline, and ensures suppliers are equipped to meet the same quality demands expected across the automotive sector.
The case for action is reinforced by OEM Customer-Specific Requirements (CSRs). Major automakers such as Ford, GM, and BMW explicitly extend quality management expectations to their supply base, including sub-tier suppliers. Even when IATF certification is not formally mandated, CSRs require alignment with IATF practices to remain competitive and avoid disqualification in sourcing decisions.
Market Dynamics in North America
North America’s automotive supply chain is tightening expectations across every tier. IATF Global Oversight reports more than 6,300 certified sites region-wide (3,663 in the U.S. and 2,270 in Mexico) reflecting strong OEM and Tier 1 demand. Still, many smaller suppliers have yet to make the transition from ISO 9001 to IATF 16949. For organizations seeking growth, certification is quickly moving from a differentiator to an entry requirement, ensuring alignment with OEM standards and access to new business opportunities throughout the continent.
“There is a lot of potential,” explains Mahdi Alahyari, Lead Auditor and IATF Veto Authority at DQS North America. Japanese OEMs such as Toyota, Honda, Subaru, Mazda, and Nissan have expanded production in Mexico, creating new supply chain opportunities. For Tier 2 and Tier 3 suppliers across North America, certification can be the difference between staying in the background and becoming a preferred supplier when OEMs increase local sourcing.
Alahyari adds, “According to the IATF requirements, Tier 1 customers are encouraged to develop their Tier 2 suppliers to become certified in the IATF standard.” Industry experts anticipate that the next published revision of the IATF standard, likely around 2027, may further strengthen expectations regarding the certification of Tier 2 suppliers. In addition, some OEM CSRs already encourage their Tier 1 suppliers to support their Tier 2 suppliers in obtaining IATF certification. “Having an IATF certificate will empower Tier 2 suppliers to further develop their market opportunities in the near future,” Alahyari summarizes.
When a plant has IATF instead of ISO 9001, it has an opportunity to subsequently sign a contract with a tier one customer.
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Tangible Benefits for Suppliers
The advantages of certification go beyond compliance. For Tier 2 and Tier 3 suppliers, the benefits are practical and measurable:
- Easier entry into Tier 1 and OEM supply chains
- Expansion within the automotive supply chain market
- Stronger control of costs, scrap, rework and warranty claims
- Greater operational efficiency and consistency
- A competitive edge over uncertified peers
By meeting IATF standards, suppliers not only protect their existing business but also strengthen their ability to grow, adapt, and build trust with higher-level customers.
From Cost to Investment
Some suppliers hesitate, viewing certification as an additional expense. But as Alahyari clarifies: “Certification is not an additional cost. It is an investment.”
When viewed as a strategic business decision, certification can support long-term operational improvements:
- Strengthens the technical and systematic capabilities of product design.
- Enhances the systematic ability of manufacturing process design and increases efficiency through techniques such as DFM (Design for Manufacturability) and DFA (Design for Assembly).
- Improves maintenance performance and cost control by applying cost-benefit methods such as TPM (Total Productive Maintenance)
- Builds a stronger and more effective supplier management system.
- Improves process control and quality performance.
- Reduces risks of defects, recalls, and costly warranty claims.
- Greater credibility with OEMs and Tier 1s, translating into new business opportunities.
By shifting the perspective from cost to value, suppliers can recognize certification as a strategic tool that strengthens both operations and market position.
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Practical Checklist for Tier 2 & 3 Suppliers
For suppliers considering the move to IATF, the first steps are clear:
- Evaluate your current ISO 9001 system against IATF requirements.
- Identify process gaps in areas like risk management, traceability, and customer-specific requirements.
- Establish an internal roadmap for readiness.
- Partner with a certification body recognized by OEMs and Tier 1 suppliers.
Moving Forward with Confidence
Certification isn’t just compliance— it’s a competitive advantage.
Tier 2 and Tier 3 suppliers stand at a turning point. With OEM and Tier 1 requirements rising, IATF certification is becoming a baseline for competitiveness rather than a differentiator. Those who take action now will be better positioned to secure new contracts, strengthen operations, and build lasting trust with customers.
Differentiation with DQS
“When they have a DQS certificate, everyone knows that this certification body is very different… it has more added value,” says Alahyari. Choosing the right certification partner matters: credibility with OEMs and suppliers is strengthened when the certificate carries recognized weight.
DQS combines international expertise with local insight to guide suppliers through the certification journey, from ISO 9001 to IATF readiness, ensuring credibility and recognition in the eyes of OEMs and Tier 1s.
If you are a Tier 2 or Tier 3 supplier considering IATF certification, DQS can help you take the next step.
Read more about IATF 16949 and what it could improve in your organization.
Author
Mahdi Alahyari
Before joining DQS, Mahdi held leadership and training roles in the automotive sector, where he developed and delivered courses on IATF standards, SPC, MSA, FMEA, APQP, and Six Sigma.
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