GM, Chrysler work on supplier relations

Published: May 31, 2013 2:37 pm ET
Updated: May 31, 2013 2:53 pm ET

Image By: Rich William

Related to this story

Topics Automotive
Companies & Associations Ford Motor Co., General Motors Co.

Are General Motors and Chrysler Group playing hardball with suppliers again? The latest automaker-supplier relations study by consulting firm Planning Perspectives Inc. was troubling.

The big jump in their scores in last year's study appeared to show that GM and Chrysler had learned a hard lesson during the 2009 bankruptcy proceedings: Better supplier relations pay dividends.

But after Toyota and Honda made real progress toward closing the gap with suppliers, the two Detroit companies seemed to stall during the past year. They didn't lose ground, but neither did they continue their progress, as reflected in the study of 441 suppliers. In fact, all of North America's six major automakers made zero progress.

John Henke, who conducts the study and has long been a strong advocate of close partnerships between suppliers and carmakers, was frustrated by the results. He says better relations lead to lower pricing, quicker sharing of technology and better-quality parts.

But are the bad old days back? It seems too early to write off the progress GM and Chrysler have made. Both have begun working with supply chains to ensure successful vehicle launches. That's a critical step because quality and productivity problems involving suppliers have hurt launches throughout the industry in the past year.

Last fall, Chrysler said it would start involving key suppliers earlier in product-development projects and would de-emphasize competitive bidding. It's too soon to assess the results of that effort. Chrysler also is helping suppliers adopt its "World Class Manufacturing System," a concept of continuous improvement.

GM has enlisted its retired engineers to help suppliers with the launch of its new full-sized pickups. The engineers are working mainly at GM's Tier 1 suppliers to ensure quality on key subsystems, but they also are keeping an eye on the readiness of Tier 2 and Tier 3 suppliers.

Those moves resemble the way the Japanese have long worked — successfully — with suppliers.

Yes, parts makers have been grumbling more in 2013. It's a stressful time. They have been under pressure to keep up with rising demand. More vehicles will be launched in the next year or so than at any other time in the industry's history.

Henke is right to alert carmakers to the danger of letting relations with suppliers slip. But these aren't the bad old days.

This column originally appeared in the May 20 issue of Automotive News, a sister publication to Plastics News.


Comments

GM, Chrysler work on supplier relations

Published: May 31, 2013 2:37 pm ET
Updated: May 31, 2013 2:53 pm ET

Post Your Comments


Back to story


More stories

Image

Smartphone work adds 52 percent to sales for China's Eva Precision

September 18, 2014 4:37 pm ET

Growth in supplying the smartphone and automotive industries helped Chinese processor Eva Precision Holdings Ltd. push injection molding sales up 52...    More

Image

Lawmakers target plastic bags, bottles

September 18, 2014 2:19 pm ET

California is poised to ban single-use plastic bags. At this point Gov. Jerry Brown could still veto the bill, but that seems extremely unlikely.    More

Image

Cascade Engineering founder Keller to step down as CEO

September 16, 2014 8:33 pm ET

Cascade Engineering Inc. is undergoing a transition as President Mark Miller will also add the role of CEO, replacing founder Fred Keller, who has...    More

Image

Canadian, Mexican injection molders form auto supply joint venture

September 16, 2014 2:26 pm ET

A new automotive parts manufacturer will open in Querétaro, Mexico, through a joint venture between Canadian automotive supplier Papp Plastics and...    More

Image

Increased capacity in the US helps Zeon Chemical supply seals globally

September 16, 2014 9:46 am ET

The automotive industry continues to be one of the driving forces of Zeon Chemicals LP., which specializes in heat-resistant and oil-resistant elastom...    More

Market Reports

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Thermoformed Packaging 2014 Market Review & Outlook – North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events