Toyota, Honda rapport with auto suppliers at 11-year low

Detroit: Auto suppliers' relations with Toyota and Honda have soured to the worst level in 11 years, but US automakers have won more trust, a survey showed.

The two largest Japanese automakers managed to retain the top two slots, respectively, in an annual survey of suppliers about their rapport with automakers that make cars and trucks in North America.

But their scores fell to the lowest point since the study introduced its "working relations" index in 2002. General Motors and Chrysler continued to occupy the bottom two slots, but they achieved their highest marks yet.

The narrowing gap suggests that the six major automakers in the United States are "converging toward mediocrity," said John Henke, president of Planning Perspectives, which conducted the survey released yesterday.

Major contribution

Salespeople from 439 major suppliers were polled in late March and early April. There were 564 respondents. About 70 per cent of the parts in a car are provided by suppliers, which make everything from seats to screws to sensors. Having good relationships with the supply base can help automakers build better vehicles more efficiently.

Ford and Nissan held their spots at No 3 and No 4, respectively.

From 2004 to 2008, Toyota and Honda earned high marks from suppliers because of their willingness to work with companies to lower costs. During that period, the three US auto-makers adopted a more combative approach. But during the recession, Toyota and Honda offered buyouts for employees, leaving them with a less-experienced workforce, Henke said. The supply crunch triggered by the tsunami in Japan last year exacerbated the problem.

"The buyers, the folks who have the day-to-day responsibilities, just aren't doing the right thing," he said. "We've had suppliers tell us in a couple cases that they don't know the Toyota Way. That's creating some problems for them."

At the same time, Chrysler and GM have adopted a more collaborative approach. The gap between top-rated Toyota and Chrysler, which was ranked last, shrank to 48 points in 2012 from 106 points in 2011.

Automakers with scores above 350 are considered to have ‘good' or ‘very good' relationships with the supply base. For the fourth straight year, not one of the six automakers in the survey showcased a good relationship with the supply sector.