A study of OEM-Supplier relations in North America shows strong gains for Toyota and Honda, with Ford, Nissan, FCA and GM falling well behind.
That’s one of the significant conclusions from the 15(th) annual North American Automotive – Tier 1 Supplier Working Relations Index Study that looks at the automakers’ supplier relations and how they impact OEM profits. This year, 435 suppliers participated.
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The study found that Ford, General Motors, FCA US and Nissan collectively would have earned US$2bn more in operating profit last year had their supplier relations improved as much as Toyota’s and Honda’s did during the year.
Results of this year’s study show Toyota and Honda clearly on top and continuing to distance themselves from Ford, Nissan, FCA and GM who are “headed in the opposite direction” according to the study’s authors.
“This year, Toyota and Honda improved their WRI ranking a combined average of 8.7 percent over last year’s levels,” said the study’s author, John W. Henke, Jr., Ph.D., president and CEO of Planning Perspectives, Inc. “Using our economic model, we know that if supplier relations at Ford, Nissan, FCA and GM also improved by 8.7 percent, they each would have realised significantly higher operating income – an estimated US$2.02bn collectively.
“At the low end, Nissan would have generated another US$261m and at the high end GM would have earned another US$750m, with Ford and FCA in between.”
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