While Johnson serves as the founder, chairman and CEO, the heads of the company's largest business units are white men.
Bob Holloway serves as president of Piston Automotive, which accounts for $2.2 billion of the company's nearly $2.9 billion in revenue. Joe Finn, serves as president and CEO of Irvin Automotive and Piston's joint venture with Valeo, Detroit Thermal Systems.
Melissa Price serves as president for Piston's office furniture unit Airea, which makes up only a small percentage of the company's overall revenue.
Gordon Fournier, COO and CFO, and Rob Fisher, group vice president of marketing and sales, are also white men. Frank Ervan, Piston Group's vice president of government affairs, is a Black man.
It's unclear why the role of chairman and CEO is not considered in control of the daily operations. But the MMSDC said in a statement its decision to decertify Piston was reviewed by third-party organizations.
" ... the MMSDC is in the business of certifying minority-owned businesses, not decertifying them without sufficient cause," the organization said in the statement. "In fact, in the very rare occasion when decertification is required, we take the extra step of engaging external certification experts to review the file."
A CEO of another minority-owned auto supplier familiar with the situation, who spoke to Crain's on the condition of anonymity, said the shakeup is the result of differing philosophies butting heads.
"One of the frustrations with the minority certifying regime is that the rules are not static and there isn't a lot of transparency," the CEO said. "The council will tell you that's deliberate because of people adhering to the letter of their rules and not in the spirit in what they want to accomplish. But I think to see a commitment to diversity at his company and not have a CEO say things like, 'I can't find any Black or Brown people who are qualified to run my operation.' That is his (Johnson's) view that gets around in the minority business community. The politics of the situation is difficult and probably influences the council to stiffen its back a little bit."
The loss of the certification may carry severe financial consequences for Piston Group. Its major customers utilize the company as part of their own minority-owned business spending.
The diversity-related spend by automakers with their suppliers has become a critical part of their operations, something automakers tout annually as part of diversifying their book of business to align more with their customer base. Ford Motor Co. has pledged for years that 10 percent of its supplier purchases would come from minority- and female-owned suppliers. In 2019, Ford purchased $8.9 billion of goods from minority-owned suppliers alone, according to its 2020 sustainability report.
Ford and Stellantis, formerly FCA, accounted for about 75 percent of Piston's sales portfolio in 2020, according to a company overview on its website. If Ford or Stellantis balk at Piston over its decertification, deciding it wants those dollars counted toward the automakers' diversity spending goals, Piston could lose out on new business contracts. FCA named Piston its Minority Business Enterprise of the Year in 2017.
Ford said in a statement Tuesday night: "It's best to speak with Piston Group about this matter. What we can tell you is that Ford fully supports parts sourcing with minority-owned suppliers — and has one of the best track records of doing so both in Michigan and the auto industry."
Representatives from Stellantis did not immediately respond to a request for comment.
Ultimately, though, the escalating situation around Piston's decertification could shake up the entire minority-owned auto sector, the minority-owned auto supplier CEO said.
"It's a game of chicken. The council says thumb your nose at our rules when we bring them to you and we'll just see what happens," the CEO said. "What's clearly best for both of them is to be able to work this through. I'm a little surprised that the automakers haven't weighed in a little more effectively. Everybody is going to be looking at them if Vinnie can't get certified to see whether minority certification really matters."
Piston has a lot at stake as one of the fastest-growing companies in Michigan in recent years. The supplier has grown from revenue of $570 million in 2012 to $2.9 billion in 2020 and more than 10,000 employees across its four subsidiaries.
In 2012, Ford approached Johnson to form the Detroit Thermal Systems joint venture with Valeo, securing even more contracts with Ford. Piston kept growing with its 2017 acquisition of then-bankrupt Takata Corp. subsidiary Irvin Automotive Inc. for $175 million in a move that propelled Piston ahead of Detroit-based Bridgewater Interiors as the nation's largest Black-owned auto supplier.
In November, Johnson and the Piston Group donated $1 million to the Pope Francis Center in Detroit to construct a new day center for the homeless in downtown.
Piston Group ranks No. 72 on the Automotive News list of the top 100 global suppliers, with worldwide sales to automakers of $2.85 billion in 2019.
