================================================================================

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ----------------------

                                    FORM 10-Q
                                    ---------

              [X] Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934
                  For the quarterly period ended March 31, 1997

              [ ] Transition Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934
                  For the transition period from ____ to _____

                  -------------------------------------------------

                         Commission file number 0-22580
                         ------------------------------


                                    JPE, Inc.
             (Exact name of registrant as specified in its charter)


                                    Michigan
                         (State or other jurisdiction of
                         incorporation or organization)

                           900 Victors Way, Suite 140
                               Ann Arbor, MI 48108
          (Address of principal executive offices, including zip code)


                                   38-2958730
                      (I.R.S. Employer Identification No.)


                                 (313) 662-2323
              (Registrant's telephone number, including area code)


                                 Not Applicable
              (Former name, former address and former fiscal year,
                         if changed, since last report)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                       Yes  /X/                  No  / /


The total number of the registrant's  Common Stock outstanding on March 31, 1997
was 4,602,180.

================================================================================

<PAGE>

                                    JPE, INC.

                                      INDEX


                                                                       Page
                                                                       ----
Part I.   Financial Information

     Item 1.  Financial Statements
              Consolidated Balance Sheets .............................   3
              -  At March 31, 1997 and 1996  (Unaudited)
              -  At December 31, 1996  (Audited)

              Consolidated Statements of Income  (Unaudited) ..........   4
              -  For the Three Months Ended March 31, 1997
                 and 1996

              Consolidated Statements of Cash Flows  (Unaudited) ......   5
              -  For the Three Months Ended March 31, 1997
                 and 1996

              Notes to Unaudited Consolidated Financial Statements ....   6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations .....................   8

Part II.  Other Information

     Item 6.  Exhibits and Reports on Form 8-K ........................  12

     Signature ........................................................  13

<PAGE>


                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

                                    JPE, INC.
<TABLE>
                           CONSOLIDATED BALANCE SHEETS
                    (Amounts in Thousands, Except Share Data)
<CAPTION>
                                               At March 31,         December 31,
                                            1997          1996          1996
                                            ----          ----          ----
                                               (Unaudited)           (Audited)
<S>                                       <C>           <C>           <C>
ASSETS
Current assets:
  Cash and cash equivalents ............  $  1,204      $    358      $  1,316
  Accounts receivable, net .............    36,679        26,547        26,829
  Inventory ............................    40,647        34,745        37,963
  Other current assets .................     8,576         4,192         8,688
                                          --------      --------      --------

     Total current assets ..............    87,106        65,842        74,796

Property, plant and equipment, net .....    71,155        50,091        69,281
Goodwill, net ..........................    26,767        32,291        27,068
Other assets ...........................     4,096         2,199         3,580
                                          --------      --------      --------

     Total assets                         $189,124      $150,423      $174,725
 .......................................  ========      ========      ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Current portion of long-term debt ....  $    672      $    107      $    323
  Short-term debt ......................     6,878          --           8,120
  Accounts payable .....................    25,303        17,412        17,643
  Accrued liabilities ..................     5,361         5,071         6,190
  Income taxes payable .................         5           288           382
                                          --------      --------      --------

     Total current liabilities              38,219        22,878        32,658


Accrued liabilities ....................     1,570         1,111         1,547
Deferred income taxes ..................     3,579         2,982         3,184
Long-term debt, non-current ............   110,070        85,243       101,558
                                          --------      --------      --------

     Total liabilities .................   153,438       112,214       138,947
                                          --------      --------      --------

Shareholders' equity:
  Preferred stock, 3,000,000 authorized,
   no shares issued and outstanding ....      --            --            --
  Common stock, 15,000,000 authorized,
   4,602,180 issued and outstanding at
   March 31, 1997 and 4,565,780 shares
   issued and outstanding at March 31,
   1996, no par value .................     28,026        27,831        27,921
  Retained earnings ....................     7,743        10,378         7,857
  Foreign currency translation
   adjustment ..........................       (83)         --            --
                                          --------      --------      --------

     Total shareholders' equity             35,686        38,209        35,778
                                          --------      --------      --------

       Total liabilities and
         shareholders' equity             $189,124      $150,423      $174,725
                                          ========      ========      ========

</TABLE>

                   The accompanying notes are an integral part
                    of the consolidated financial statements.

<PAGE>

                                    JPE, INC.
<TABLE>
                        CONSOLIDATED STATEMENTS OF INCOME

                  (Amounts in Thousands, Except Per Share Data)
<CAPTION>
                                                  Three Months
                                                     Ended
                                                    March 31,
                                         1997                      1996
                                         ----                      ----
                                                   (Unaudited)
<S>                                     <C>                       <C>

Net sales                               $67,995                   $47,611

Cost of goods sold                       59,033                    38,735
                                        -------                   -------

   Gross profit                           8,962                     8,876

Selling, general and
 administrative expenses                  6,845                     5,669
                                        -------                   -------

   Operating profit                       2,117                     3,207

Other expense                                72                      --

Interest expense, net                     2,144                     1,655
                                        -------                   -------

   Income (loss) before
    income taxes                            (99)                    1,552

Income tax expense                           15                       620
                                        -------                   -------

   Net income                           $  (114)                  $   932
                                        =======                   =======


Earnings (loss) per
 common share                           $ (0.02)                  $  0.20
                                        =======                   =======


Weighted average
 shares outstanding                       4,611                     4,579
                                          =====                     =====
</TABLE>

                   The accompanying notes are an integral part
                    of the consolidated financial statements.


<PAGE>

                                    JPE, INC.
<TABLE>
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                             (Amounts in Thousands)
<CAPTION>
                                                               Three Months
                                                                  Ended
                                                                 March 31,
                                                             1997         1996
                                                             ----         ----
                                                                (Unaudited)
<S>                                                        <C>          <C>
Cash flows from operating activities:
  Net (loss) income ....................................   $  (114)     $   932
  Adjustments to reconcile net income to
  net cash provided by operating activities:
    Depreciation and amortization ......................     2,303        1,726
    Changes in operating assets and liabilities:
      Accounts receivable ..............................    (9,850)      (3,137)
      Inventory ........................................    (2,684)        (607)
      Prepaids and other ...............................      (404)         679
      Accounts payable .................................     7,660        2,256
      Accrued liabilities ..............................      (806)        (668)
      Income taxes .....................................        18          255
                                                           -------      -------

        Net cash provided (used) 
         by operating activities .......................    (3,877)       1,436

Cash flows from investing activities:
  Purchase of property and equipment ...................    (4,081)      (3,871)
                                                           -------      ------- 
        Net cash used for investing
         activities ....................................    (4,081)      (3,871)

Cash flows from financing activities:
  Sale of common stock .................................        77          355
  Repayments of other debt .............................    (1,199)        --
  Net borrowings under revolving loan ..................     8,275       12,075
  Net borrowings under Canadian credit
   facility ............................................       (19)        --
  Repayments of note payable ...........................      --        (10,100)
  Tax benefit from options .............................        28          175
  Borrowing under capital lease ........................       811         --
                                                           -------      -------

        Net cash provided by financing
         activities ....................................     7,973        2,505

Currency translation ...................................      (127)        --

Cash and cash equivalents:
  Net increase (decrease) in cash ......................      (112)          70

  Cash and cash equivalents,
   beginning of period .................................     1,316          288
                                                           -------      -------

  Cash and cash equivalents,
   end of period .......................................   $ 1,204      $   358
                                                           =======      =======
</TABLE>

                   The accompanying notes are an integral part
                    of the consolidated financial statements


<PAGE>

                                    JPE, INC.
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                             (Amounts in Thousands)


A.   BASIS OF PRESENTATION:

     The accompanying unaudited consolidated condensed financial statements have
     been prepared in accordance with generally accepted  accounting  principles
     for interim financial information. Accordingly, the financial statements do
     not include all of the  information  and  footnotes  required by  generally
     accepted accounting  principles for complete financial  statements.  In the
     opinion of  management,  all  adjustments  considered  necessary for a fair
     presentation  have  been  included,  and such  adjustments  are of a normal
     recurring nature.  Certain financial statement items have been reclassified
     to conform to current year's format. The consolidated  financial statements
     should  be read in  conjunction  with the  financial  statements  and notes
     thereto contained in the JPE, Inc. Annual Report and Form 10-K for the year
     ended December 31, 1996.


B.   INVENTORY:

     Inventories by component are as follows:
<TABLE>
<CAPTION>
                          March 31, 1997      March 31, 1996      Dec. 31, 1996
                          --------------      --------------      -------------
     <S>                     <C>                 <C>                  <C>
     Finished goods ......   $16,317             $16,258              $15,457
     Work in process .....     5,596               3,534                4,811
     Raw material ........    15,949              12,115               15,116
     Tooling .............     2,785               2,838                2,579
                             -------             -------              -------
                             $40,647             $34,745              $37,963
                             =======             =======              =======
</TABLE>


C.   SUBSEQUENT EVENT:

     On April 16, 1997,  Dayton Parts,  Inc., a wholly-owned  subsidiary of JPE,
     Inc.,  acquired all of the capital stock of Brake,  Axle and Tandem Company
     ("BATCO").  The purchase price was approximately  $10.5 million in cash and
     the assumption of certain  liabilities  plus an earn-out based on sales not
     to exceed $3.9 million over the next three years. This  acquisition,  which
     will be accounted for as a purchase,  was financed  through funds available
     under the credit agreement. BATCO is a full line aftermarket distributor of
     suspension,  brake and wheel parts for the heavy duty and medium duty truck
     industry.


<PAGE>

                                    JPE, INC.
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                             (Amounts in Thousands)


D.   NEW FINANCIAL ACCOUNTING STANDARDS:

     In February 1997, the Financial Accounting Standards Board issued Statement
     of  Financial  Accounting  Standards  No.  128 - Earnings  per Share.  This
     standard requires a change in method for computing and presenting  earnings
     per share  effective  for the period  ending after  December 15, 1997.  The
     Company has reviewed  this  statement  and  believes  that there will be no
     material change in its reported earnings per share amounts.

<PAGE>

                                    JPE, INC.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
         FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following  discussion  should be read in conjunction  with the  consolidated
financial statements and notes thereto filed with the Company's Annual Report on
Form 10-K to assist in understanding  the Company's  results of operations,  its
financial position,  cash flows,  capital structure and other relevant financial
information.


FORWARD LOOKING INFORMATION

This Quarterly  Report on Form 10-Q contains,  and from time to time the Company
expects to make,  certain  forward-looking  statements  regarding  its business,
financial  condition and results of  operations.  In  connection  with the "Safe
Harbor"  provisions  of the Private  Securities  Reform Act of 1995 (the "Reform
Act"),  the Company intends to caution readers that there are several  important
factors that could cause the Company's actual results to differ  materially from
those projected in its forward-looking statements, whether written or oral, made
herein or that may be made  from  time to time by or on  behalf of the  Company.
Readers are cautioned that such forward-looking  statements are only predictions
and that actual events or results may differ materially.  The Company undertakes
no  obligation  to  publicly  release  the  results  of  any  revisions  to  the
forward-looking  statements to reflect events or circumstances or to reflect the
occurrence of unanticipated events.

The Company wishes to ensure that any forward-looking statements are accompanied
by  meaningful  cautionary  statements  in order to comply with the terms of the
safe harbor provided by the Reform Act. Accordingly, the Company has set forth a
list of  important  factors  that could cause the  Company's  actual  results to
differ  materially  from  those  expressed  in  forward-looking   statements  or
predictions made herein and from time to time by the Company.  Specifically, the
Company's  business,  financial  condition  and results of  operations  could be
materially different from such  forward-looking  statements and predictions as a
result of (i) customer pressures that could impact sales levels and product mix,
including customer sourcing decisions,  customer evaluation of market pricing on
products  produced by the  Company  and  customer  cost-cutting  programs;  (ii)
operational  difficulties  encountered  during  the  launch  of  major  new  OEM
programs;  (iii) the ability of the Company to integrate  acquisitions  into its
existing  operations and achieve expected cost savings;  (iv) the ability of the
Aftermarket  Group to balance the cyclical  nature of the OEM industry;  and (v)
the availability of funds to the Company for strategic  acquisitions and capital
investments to enhance existing production and distribution capabilities.

<PAGE>

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 1997 COMPARED TO THREE MONTHS ENDED MARCH 31, 1996

Net sales for the quarter  ended March 31, 1997 were $68.0  million  compared to
$47.6  million for the same period in 1996, an increase of 43%. This increase is
primarily  attributable  to the  acquisition  of JPE  Canada  Inc.,  a  Canadian
supplier of exterior  trim to OEMs,  which was  acquired  out of  bankruptcy  in
December of 1996. In the first quarter of 1996,  the Company  experienced a loss
in sales by its OEM  businesses  estimated  at  approximately  $2.8 million as a
result of the Delphi  Chassis  brake plant strike which  closed  General  Motors
Corporation assembly plants for three weeks in March 1996.

For the quarter ended March 31, 1997,  net sales for the Company were 74% to OEM
customers  and 26% to  Aftermarket  customers.  On April 16,  1997,  the Company
purchased Brake, Axle and Tandem Company ("BATCO"),  an aftermarket  distributor
of suspension and brake parts to the heavy and medium duty truck industry.  With
this  acquisition,  the  amount of  aftermarket  sales in future  quarters  as a
percentage of total sales is estimated to be approximately 30%.

Gross profit was $9.0  million for the three  months  ended March 31,  1997,  as
compared  with $8.9  million for the  comparable  period in the prior year.  The
gross margin  percentages were 13.2% and 18.6% for 1997 and 1996,  respectively.
This decline in gross margin  percentages  is primarily the result of JPE Canada
Inc.  which was purchased out of bankruptcy in 1996.  JPE Canada's  gross profit
was .1% for the first quarter of 1997. The Company has implemented a turn-around
plan to improve  profitability  through  reducing scrap,  premium  freight,  and
overtime and improving  productivity.  Although  improvements  will be on-going,
management  anticipates  the full  impact  of this  plan is not  expected  to be
realized until late in 1997. Adjusting for JPE Canada's  performance,  the gross
profit  percentage  declined to 17.2%. This decline is attributable to the lower
performance  of  the  Starboard  Industries  and  the  Industrial  &  Automotive
Fasteners businesses as compared to first quarter of 1996.

Selling,  general and administrative  expenses increased 18% to $6.8 million for
the three months  ended March 31,  1997,  from $5.7 million for the three months
ended March 31, 1996. This increase is a result of the acquisition of JPE Canada
and higher sales commissions for the quarter. The percentage of selling, general
and  administrative  expenses to net sales was 10.1% for the quarter ended March
31, 1997 as compared to 11.9% for the  comparable  period of the prior year. The
decline in this percentage  reflects the greater  percentage of sales to the OEM
market which has lower selling costs.

<PAGE>

The  operating  profits for JPE's U.S.  operations  continue to improve over the
1996  second  half  performance  as  shown  in the  table  below,  adjusted  for
non-recurring charges:

<TABLE>
<CAPTION>
Quarter Ended                 Operating Profit         Percent of Sales
-------------                 ----------------         ----------------
<S>                             <C>                          <C>

September 30, 1996              $  993,000                   2.0%
December 31, 1996               $1,307,000                   2.9%
March 31, 1997                  $2,685,000                   5.2%

</TABLE>

This improvement is attributable primarily to stronger operating performances in
our OEM businesses as a result of action plans  instituted in the second half of
1996.  These action plans are  continuing to be examined and refined for further
operating enhancements in order to reach a goal of an operating profit margin in
excess of 8% for the U.S.  operations by the end of the calendar year,  although
there can be no assurances that this level will be reached.

Net interest expense  increased to $2.1 million for the three months ended March
31, 1997 as compared to $1.7  million for the three months ended March 31, 1996.
The higher  interest cost is  attributable  to the funds borrowed to finance the
acquisition  of  JPE  Canada  and  increased  capital  investments  and  tooling
expenditures for production of 1998-2000 model programs for our OEM customers.

The  effective tax rates for the three months ended March 31, 1997 and 1996 were
15% and  40%,  respectively.  The  tax  benefit  associated  with  the  Canadian
operation's  pretax loss for quarter  ended March 31, 1997 does not fully offset
the taxes computed for the U.S. operations.  The U.S. operations'  effective tax
rate was 42% compared to the Canadian tax benefit  effective  rate of 36% in the
first  quarter of 1997.

Net loss for the three  months  ended  March 31,  1997 was  $114,000 or $.02 per
share as  compared  to net income of  $932,000  or $.20 a share for the  quarter
ended March 31, 1996. The net loss for this quarter  includes a loss of $570,000
or $.12 per share relating to the operations of JPE Canada.


LIQUIDITY AND CAPITAL RESOURCES

The Company's principal capital requirements are to fund business  acquisitions,
working  capital needs,  and capital  additions to enhance  existing  production
technologies  and  capabilities.  Historically,  the  Company has used cash flow
generated  by  operations,  borrowings  under its credit  agreements  and equity
financing to meet these needs.

<PAGE>

The Company's  principal source of liquidity for the U.S. operations is the $110
million Third Amended and Restated  Credit  Agreement  dated  December 31, 1996.
This  agreement was amended on April 16, 1997 to increase the  commitment by $10
million for the purchase of BATCO and to provide  further  liquidity for working
capital needs.  At March 31, 1997, the amount  outstanding  under this agreement
was $100 million and on closing of the purchase of BATCO,  the Company  borrowed
an additional  $6 million.  This Credit  Agreement  matures on October 31, 1998.
Management is currently evaluating various options to refinance,  restructure or
extend this  facility and believes it will be  successful  in  completing  these
activities  prior to the maturity date.  The Company was in compliance  with all
covenants as of March 31, 1997.

The Company's JPE Canada  subsidiary has a credit agreement with a Canadian bank
to fund its operating requirements and capital expenditures.  At March 31, 1997,
the borrowings under this facility total approximately $16.5 million.  Repayment
terms of borrowings under this facility vary based on the nature of the advance.
Currently,  $7.3 million is classified as short-term debt because the portion of
the  credit  agreement  for  operating  requirements  is payable on demand or on
December 31, 1997.  The total  commitment for operating  needs is  approximately
$10.1 million through  December 31, 1997,  reducing to $8.5 million in 1998 (Cdn
$14 million and $12 million,  respectively).  The term portion of this agreement
aggregates  approximately $9.2 million with monthly principal payments beginning
in October 1997 of approximately $72,000 (Cdn $100,000).  It is anticipated that
the cash flow from the Canadian operations will fund these future payments.

Working  capital at March 31,  1997  increased  to $48.9  million as compared to
$42.1  million at December 31, 1996.  The increase in working  capital is due to
higher  receivables  and  inventories  which was not fully  offset by  increased
payables.  This situation  occurred partially because JPE Canada's payment terms
with its  vendors  are, on average,  less than 30 days  because of JPE  Canada's
predecessor's  bankruptcy filing.  Management is rebuilding vendor relationships
and believes that by the end of the year it should have average payment terms at
40 days, which is customary in this industry. In addition, at December 31, 1996,
receivables and  inventories  were low due to the Christmas shut down by our OEM
customers.  Cash used by operations  was $3.9 million for the reasons  mentioned
above. Capital expenditures spending for the quarter totaled $4.1 million. These
funds were provided through the various credit  agreements.  The Company expects
that it will satisfy its debt service,  working capital and capital  expenditure
requirements  through  cash flows  generated  by  operations  and, to the extent
necessary, through borrowings under the credit agreements.

<PAGE>

                           PART II. OTHER INFORMATION

                                    JPE, INC.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         a.  Exhibits:

             None

         b.  Report on Form 8-K:

               On  January  6,  1997,  Registrant  filed a  report  on Form  8-K
               reporting the acquisition of substantially all of the assets used
               in the business of Pebra Inc.

               On  March  6,  1997,  Registrant filed  Amendment 1 to Form 8-K/A
               containing financial  statements for Registrant's  acquisition of
               substantially  all of the assets  used in the  business  of Pebra
               Inc.


<PAGE>

                                    JPE, INC.

                                    SIGNATURE


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                    JPE, Inc.


                                    By:   /s/ James J. Fahrner
                                        -----------------------
                                          James J. Fahrner
                                          Vice President and Chief
                                            Financial Officer
                                          (Principal Financial Officer and
                                            Principal Accounting Officer)


Date:  May 14, 1997


<PAGE>

                                 EXHIBIT INDEX
                                 -------------

EXHIBIT
  NO.                         DESCRIPTION
-------                       -----------

  27                          Financial Data Schedule, which is submitted
                              electronically to the Securities and Exchange
                              Commission for information only and not filed.