Toyota and Honda Roll in Suppliers’ Eyes

Published Date : May 18, 2015

In the North American car supply business, Honda and Toyota are known as gold standards, while Fiat Chrysler, General Motors, Ford, and Nissan are no behind. 

In the last annual survey carried by Planning Perspectives Inc., about 435 suppliers opined the purchasing operations of Honda and Toyota. This is credited to high grades of its top executives and effort s to develop long term relationships.

The German luxury car brand BMW AG which received separate ratings also got high grades.
However, sadly, Ford, FCA, Nissan, and GM each of the car brands received worse grades than what they received last year. This brought an end to a six year stretch in which the car brands had closed gap with Toyota and Honda. Volkswagen was also rated separately along with BMW, and performed worst of all. 

The survey did not receive adequate responses for Mercedes-Benz and Hyundai to receive ratings. 

As per president of Planning Perspectives, the three car makers showcased willingness to venture with suppliers during recession period and their survival was risky. 

Currently, buyers at GM and FCA  are predominantly focusing on price cuts, as per the president.

If internal statutes are all about price cuts, purchasers are simply going back to their old ways of receiving reductions, as quoted in a written statement by the president.

As per the president each carmaker received grading based on five factors, namely relations with suppliers, efforts to aid suppliers with price cuts, sharing savings willingness, communications, and avoiding hindrances such as engineering changes at the end. 

The purchasing chief at GM commented, he was working to improve relationships with suppliers. Although there is work to be carried, the objectives have been set clear and implemented also in order to have mutual business targets.