Tech tock

19 May 2015 By Antony Currie Follow @AntonyMCurrie

A new study claims Chrysler, Ford and GM could have made $1.8 bln more last year if they hadn’t been so mean to parts makers. History shows haranguing suppliers is mutually damaging. It’s especially short-sighted when they’ll be the source of tech innovations for connected cars.

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Ford Motor, General Motors, Fiat Chrysler Automobiles and Nissan would have earned $2 billion in extra operating profit between them last year if they had better relations with their suppliers, according to a study by Planning Perspectives that was published on May 18.

The four companies fared worst in the research firm’s 15th annual North American Automotive – Tier 1 Supplier Working Relations Index. The survey tracks how suppliers rank their relationships with the major U.S. and Japanese automakers operating in the region.

For the first time the study included “an economic model that proves a direct cause-effect relationship between an automotive OEM’s supplier relations and the OEM’s operating profit,” according to Planning Perspectives’ President John Henke.

Toyota and Honda performed best in the survey. A total of 435 suppliers responded, representing 59 percent of carmakers’ annual spending on car-parts makers.

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