Honda Motor Co. (7267) and Toyota Motor Corp. (7203) plummeted in a survey on relations with suppliers, while gains by Chrysler Group LLC and General Motors Co. helped close the gap between top and bottom performers.
While no company changed places on an annual list with the six largest automakers by U.S. sales, the gulf from Chrysler at No. 6 in supplier relations to Toyota at No. 1 was 19 percent, the narrowest in 12 years of research by Planning Perpectives Inc. In 2005, Toyota’s score was more than triple that of GM (GM), then No. 6. All six companies now are in the “low adequate range,” the researcher said in a statement today.
Collaboration with suppliers can help automakers lower costs, improve quality and spur innovation. When sales drop, as in the recession and last year’s tsunami and earthquake in Japan, automakers have leaned on suppliers to cut costs, said John Henke, Planning Perspectives’ chief executive officer. Starting with the 2008-09 downturn, Toyota and Honda became “a little more adversarial” with suppliers, he said.
“It has gotten worse, but they’re well above everybody else,” Henke said in an interview.
Toyota’s rating fell 9.5 percent, the biggest decline, while No. 2 Honda’s dropped 5.2 percent, according to Birmingham, Michigan-based Planning Perspectives. Toyota, based in Toyota City, Japan, and Honda, based in Tokyo, lost points in scoring for five straight years.
Chrysler gained 12 percent, the biggest increase. The Auburn Hills, Michigan-based company, which is run by Fiat SpA (F), improved for the third straight year. While Chrysler remained in last place, the difference between it and both GM and Nissan Motor Co. (7201) isn’t statistically significant, Henke said.
Ford Motor Co. (F) fell 1.5 percent while remaining in third place for the second straight year. It is the only non-Japanese automaker ever ranked in the top three in the survey.
GM rose 6.4 percent and ranks fifth. The Detroit-based automaker, which exited bankruptcy in 2009, has more than doubled its standing with suppliers since bottoming out in 2005. Nissan Motor Co., based in Yokohama, Japan, rose 3.6 percent and ranked fourth.
Comments from the companies show they pay attention to the survey results.
“While we appreciate our ranking position, we clearly understand we have work to do in strengthening our relationships,” Robert Young, Toyota’s head of purchasing for manufacturing operations in North America, said in a statement.
“There has been this convergence and all the relationships are improving overall,” Ron Lietzke, a Honda spokesman, said in an interview. “It validates what Honda started 30 years ago that developing cooperative partnerships with suppliers has perhaps become mainstream in the industry.”
At Chrysler, “we are very pleased to see evidence that the work we are doing to improve our relationships with our suppliers is making an impact,” Scott Kunselman, senior vice president for purchasing, said in an e-mailed statement. “The survey results make it clear that while we are on the right track, we still have a long way to go.”
Ford, which had $30.1 billion in losses from 2006 through 2008, earned $20.2 billion last year. The turnaround helped the Dearborn, Michigan-based automaker boost its ranking 65 percent since 2007. The company hit a plateau in supplier relations in 2010, Tony Brown, Ford’s global purchasing chief, said in a statement.
“This year’s results tell us we have more work to do to regain our momentum,” he said.
Planning Perspectives surveyed 564 salespeople and engineers from 439 direct suppliers, on areas such as trust, communication, helpfulness in engineering and the opportunity to make a profit.
The parts produced by suppliers, such as instrument panels, seats, axles and navigation systems, typically make up more than two-thirds of a vehicle’s value, Planning Perspectives has said.
While the survey collected data on European automakers, Planning Perspectives said it didn’t have enough information to rank those companies. If rankings had been made on what data were collected, Bayerische Motoren Werke AG (BMW) would have placed first among the Europeans, followed by Daimler AG (DAI) and Volkswagen AG. (VOW) BMW and Daimler would have topped all of the automakers in the U.S. and Japan, and VW would have ranked last, according to the research.
2012 Automaker 2012 2011 Rank Score Score 1 Toyota 296 327 2 Honda 293 309 3 Ford 267 271 4 Nissan 256 247 5 GM 251 236 6 Chrysler 248 221
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