Suppliers Love Toyota and Honda

Customer satisfaction is always the most important thing for automakers. The more their customers love them, the easier it is for them to sell more of their vehicles. An overlooked component of satisfaction, at least by most outside of the industry, is vendor satisfaction. How do the companies that supply the parts and materials feel about each manufacturer.

For the 14th consecutive year, Honda and Toyota topped the list of manufacturers that their vendors love. The ratings are supplied by Planning Perspectives of Birmingham, AL. They look at the various relationships between automakers and their suppliers and rank companies based upon sentiment.

“If supplier relations at Ford, Nissan, Chrysler and GM also improved by 8.7% they each would have realized significantly higher operating income — an estimate $2.02 billion collectively,” said John Henke, CEO of Planning Perspectives.

The concept is that the worse a relationship is with the supplier, the more it can cost consumers because of increased expenses that result. Infrastructure and communication are the biggest potential pitfalls.

According to Detroit Free Press:

In fairness to automakers, their purchasing departments are under pressure from management and Wall Street investors to pay less even as production increases and new models with enhanced technology are introduced.

Being regarded as the most cooperative manufacturer might not achieve those savings. But Henke suggests that focusing on price cuts doesn’t always save money, especially when a supplier decides to not offer its best engineering talent or newest innovations.

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