September 4, 1998

JPE, Inc.
775 Technology Drive
Suite 200
Ann Arbor, Michigan 48108
Attention:  Mr. James J. Fahrner and Ms. Donna L. Bacon

RE:  FORBEARANCE  AGREEMENT  AMONG  COMERICA  BANK,  NBD BANK,  NATIONAL BANK OF
     CANADA,  HARRIS  TRUST  AND  SAVINGS  BANK,  AND  BANK  ONE,  DAYTON,  N.A.
     (COLLECTIVELY,  THE  "BANKS"),  COMERICA  BANK,  AS  AGENT  FOR  THE  BANKS
     ("AGENT"), JPE, INC. ("COMPANY") AND ALLPARTS, INCORPORATED ("API"), DAYTON
     PARTS, INC. ("DPI"), SAC CORPORATION,  STARBOARD INDUSTRIES,  INC. ("SBI"),
     INDUSTRIAL  &  AUTOMOTIVE  FASTENERS,  INC.  ("IAF"),  PLASTIC  TRIM,  INC.
     ("PTI"), BRAKE, AXLE AND TANDEM COMPANY CANADA INC. AND JPE FINISHING, INC.
     (COLLECTIVELY,  "GUARANTORS") DATED AUGUST 10, 1998, AND AMENDED BY A FIRST
     AMENDMENT DATED AUGUST 31, 1998 (AS AMENDED, THE "FORBEARANCE AGREEMENT")

Dear Mr. Fahrner and Ms. Bacon:

Company and Guarantors have requested that Banks extend the forbearance provided
for in the Forbearance Agreement.

Subject to written  acceptance by Company and Guarantors of the following  terms
and  conditions by 10:00 a.m. on September 8, 1998,  Agent and Banks are willing
to grant certain accommodations and to forbear until September 11, 1998, subject
to earlier  termination  as provided  below,  from further action to collect the
Indebtedness:

1.   All  capitalized  terms  not  defined  in  this  second  amendment  to  the
     Forbearance   Agreement  ("Second   Amendment")  shall  have  the  meanings
     described in the Forbearance Agreement and/or the Loan Documents.

2.   Except as modified  by this  Second  Amendment,  the  Indebtedness  and the
     financing  arrangements  among Agent,  Banks,  Company and Guarantors shall
     continue to be  governed  by the  covenants,  terms and  conditions  of the
     Forbearance  Agreement  and the Loan  Documents,  which  are  ratified  and
     confirmed.  The liens and  security  interests  granted  to Agent and Banks
     under the Loan  Documents and the  Forbearance  Agreement are also ratified
     and confirmed by Company and  Guarantors.  This Second  Amendment  shall be
     binding  upon and shall inure to the benefit of Agent,  Banks,  Company and
     Guarantors, and their respective successors and assigns.

3.   Company  and  Guarantors  acknowledge  that  Agent  and  Banks are under no
     obligation  to advance  funds or extend  credit to Company  and  Guarantors
     under the Forbearance Agreement,  as amended, the Credit Agreement or other
     Loan Documents, or otherwise.

4.   Subject to  maintaining  the advisory  Advance  Formula equal to or greater
     than the  aggregate of (i) Advances  under the  Revolving  Credit and Swing
     Line and (ii) the Letter of Credit  Obligations,  and provided there are no
     defaults under the terms of the Forbearance  Agreement,  as amended, and no
     further  defaults  under  the Loan  Documents,  Banks  may,  in their  sole
     discretion, continue to advance to Company under the Revolving Credit Loan,
     in accordance with the Loan Documents,  as amended,  through  September 11,
     1998. Company and Guarantors agree that:

     (a)  from August 31,  1998  forward,  the portion of the funds  borrowed by
          Company  for the  benefit  of PTI  and/or  SBI shall be limited to the
          aggregate  amount of funds collected by PTI and SBI and applied to the
          Indebtedness  from and after  August  31,  1998 (both  borrowings  and
          collections shall be computed on a cumulative basis); and

     (b)  neither  Company  nor any of the  Guarantors  shall make  intercompany
          transfers  of any kind to or for the benefit of PTI and/or SBI,  other
          than as permitted by subparagraph (a) above.

<PAGE>

5.   COMPANY,  GUARANTORS,  AGENT AND BANKS ACKNOWLEDGE AND AGREE THAT THE RIGHT
     TO TRIAL BY JURY IS A CONSTITUTIONAL  ONE, BUT THAT IT MAY BE WAIVED.  EACH
     PARTY,  AFTER  CONSULTING  (OR HAVING HAD THE  OPPORTUNITY TO CONSULT) WITH
     COUNSEL OF THEIR CHOICE,  KNOWINGLY AND  VOLUNTARILY,  AND FOR THEIR MUTUAL
     BENEFIT  WAIVES  ANY  RIGHT  TO TRIAL  BY JURY IN THE  EVENT OF  LITIGATION
     REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED TO, THIS
     SECOND  AMENDMENT,  THE  FORBEARANCE  AGREEMENT,  THE LOAN DOCUMENTS OR THE
     INDEBTEDNESS.

6.   COMPANY AND GUARANTORS,  IN EVERY CAPACITY,  INCLUDING, BUT NOT LIMITED TO,
     AS SHAREHOLDERS,  PARTNERS, OFFICERS, DIRECTORS, INVESTORS AND/OR CREDITORS
     OF COMPANY  AND/OR  GUARANTORS,  OR ANY ONE OR MORE OF THEM,  HEREBY WAIVE,
     DISCHARGE AND FOREVER RELEASE AGENT, BANKS, AND THEIR EMPLOYEES,  OFFICERS,
     DIRECTORS, ATTORNEYS,  STOCKHOLDERS AND SUCCESSORS AND ASSIGNS, FROM AND OF
     ANY AND ALL CLAIMS,  CAUSES OF ACTION,  DEFENSES,  COUNTERCLAIMS OR OFFSETS
     AND/OR ALLEGATIONS COMPANY AND/OR GUARANTORS MAY HAVE, OR MAY HAVE MADE, OR
     ARE BASED ON FACTS OR  CIRCUMSTANCES  ARISING,  AT ANY TIME UP THROUGH  AND
     INCLUDING  THE DATE OF THIS  SECOND  AMENDMENT,  WHETHER  KNOWN OR UNKNOWN,
     AGAINST ANY OR ALL OF AGENT, BANKS, THEIR EMPLOYEES,  OFFICERS,  DIRECTORS,
     ATTORNEYS, STOCKHOLDERS AND SUCCESSORS AND ASSIGNS.

Agent and  Banks  reserve  the right to  terminate  their  forbearance  prior to
September 11, 1998 in the event of any new defaults  under the Loan Documents or
a default under the Forbearance  Agreement as amended by this Second  Amendment,
in the event of further  deterioration in the financial  condition of Company or
Guarantors or further  deterioration in Agent's or Banks'  collateral  position,
and/or in the event Agent or Banks,  for any reason,  believes that the prospect
of payment or performance is impaired.

Very truly yours,

COMERICA BANK, Agent


By:  /s/ Cynthia B. Jones
     Cynthia B. Jones
     -------------------------
Its: Vice President
Special Assets Group
P.O. Box 75000
Detroit, Michigan 48275-3205
(313) 222-3780
(313) 222-5706 Fax


COMERICA BANK                               NBD BANK

By:  /s/ Cynthia B. Jones                   By:  /s/ Phillip D. Martin
     -------------------------                   ------------------------- 
Its: Vice President                         Its: Vice President


NATIONAL BANK OF CANADA                     HARRIS TRUST and SAVINGS BANK

By:  /s/ Duane K. Bedard                    By:  /s/ Sandra J. Sanders
     -------------------------                   -------------------------
Its: Vice President                         Its: Sr. Vice President

By:  /s/ Angus White
     -------------------------
Its: Vice President


BANK ONE, DAYTON, N.A.

By:  /s/ Scott E. Roman
     -------------------------
Its: Assistant Vice President

<PAGE>

ACKNOWLEDGED AND AGREED:

JPE, INC.                                   DAYTON PARTS, INC.

By:  /s/ Donna L. Bacon                     By:  /s/ Donna L. Bacon
     -------------------------                   -------------------------
Its: President                              Its: Vice President
Date: 9/4/98                                Date: 9/4/98


ALLPARTS, INCORPORATED                      SAC CORPORATION

By:  /s/ Donna L. Bacon                     By:  /s/ Donna L. Bacon
     -------------------------                   -------------------------
Its: Vice President                         Its: Vice President
Date: 9/4/98                                Date: 9/4/98


STARBOARD INDUSTRIES, INC.                  BRAKE, AXLE AND TANDEM
                                            COMPANY CANADA INC.

By:  /s/ Donna L. Bacon                     By:  /s/ Donna L. Bacon
     -------------------------                   ------------------------- 
Its: Vice President                         Its: Vice President
Date: 9/4/98                                Date: 9/4/98


INDUSTRIAL & AUTOMOTIVE                     JPE FINISHING, INC.
FASTENERS, INC.

By:  /s/ Donna L. Bacon                     By:  /s/ Donna L. Bacon
     -------------------------                   -------------------------
Its: Vice President                         Its: Vice President
Date: 9/4/98                                Date: 9/4/98


PLASTIC TRIM, INC.

By:  /s/ Donna L. Bacon
     -------------------------
Its: Vice President
Date: 9/4/98