In 17 measures ranging from trust to perceived opportunity to make acceptable profits, Japanese vehicle makers consistently outperform their US rivals, according to an annual survey of supplier attitudes toward the six biggest car manufacturers in North America cited by the weekly trade newspaper Automotive News.
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The paper said the 2003 survey shows Toyota, Honda and Nissan climbing even higher in suppliers’ eyes while Ford and General Motors slipped, while the Chrysler group gained slightly. Generally, the Japanese are known for taking a more cooperative approach with their suppliers than the Big Three, Automotive News noted.
Of the 17 issues measured, the most important to suppliers is trust, survey author John Henke told Automotive News. He is an Oakland (Michigan) University professor of marketing and president of Planning Perspectives, a management-consulting firm in Birmingham, Michigan.
In the area of trust, suppliers gave Toyota a score of 3.59 out of a maximum of 4.0, up from 3.4 a year earlier. At the other end of the spectrum, GM rated 2.12, unchanged, the paper said.
“We have top (Big 3) management saying to us that supplier relations are extremely important,” Henke told Automotive News. “There’s no question in my mind that they’re sincere about it.
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By GlobalData“But when you get down to the buyer level, they’re paid on the basis of getting the piece-price down. What top management would like to see in its supplier relationships is not being reinforced from a behavioural standpoint at the lower levels,” Henke reportedly added.
According to Automotive News, Henke said the Japanese are every bit as demanding as the Big Three on costs, but they employ cooperative efforts to obtain price cuts and reward suppliers with long-term relationships. That approach, in turn, yields cost and quality advantages, the report notes, the paper said.
“GM and its suppliers are continuously driving to forge more collaborative relationships by collectively focusing on performance and common goals,” GM spokeswoman Renee Rashid-Merem told Automotive News.
Chrysler group spokesman David Barnas told the paper his company’s relations with suppliers are based on performance.
“Our goal is to develop an All-Star team every time we select suppliers,” he reportedly said. “All of our suppliers are measured on quality, cost, technology and supply.”
Stuck with higher labour and warranty costs, older and less efficient plants and postretirement costs that the import brand transplant factories do not have, and spending more heavily on incentives to sell their vehicles than the transplants because of perceived differences in quality and resale values, the Big Three turn to their suppliers, the easiest targets, to generate cost savings, Automotive News said.
