(From the June 27, 2011, issue of Rubber & Plastics News)
AKRON—Maybe—just maybe—Detroit's auto manufacturers finally have learned the Golden Rule, “do unto others as you would have others do unto you.”
The “others” being their suppliers, like the many makers of tires, hose, belts, weatherstripping and various components found in vehicles. The standard operating procedure for the Detroit 3 during most of their history was “do unto others whatever benefits you, and the heck with them.”
The latest version of an annual study by a Detroit research firm indicates General Motors, Ford and Chrysler all have improved their relationships with their suppliers immensely during the past two years.
Nothing like a near-death experience—bankruptcy for GM and Chrysler, a virtual collapse of auto sales for all three companies during the Great Recession—to cause an attitude change.
Chrysler, for example, had an awful reputation among its suppliers just two years ago, according to the report from Planning Perspectives Inc. Now, with Fiat in the driver's seat, and a major effort to promote harmony with its suppliers, Chrysler has much better relations with its vendors.
Chrysler and GM—the company that once unleashed Jose Ignacio Lopez on its auto suppliers, a name that still lives in infamy to them—are tied with Japanese auto maker Nissan in the latest report. Ford actually is barely behind Honda Motor Co.'s North American manufacturing arm—an amazing feat considering Honda is second only to Toyota Motor Co., and the Japanese transplants long have led the way in good supplier relations.
It makes good business sense for the Detroit 3 to develop positive relationships with their suppliers. The auto companies—as the report states—will get higher quality and lower prices from them, and innovative vendors will be more willing to share new technology.
If the Detroit auto makers want more proof of the value of their suppliers, they just need to see what has happened to the Japanese companies when the earthquake, tsunami and nuclear disasters struck Japan. The auto companies made it through the upheaval fairly well, but some suppliers didn't. That has caused significant disruption in vehicle production.
Automotive suppliers are one link in a chain—a very valuable link. It's looks like the Detroit auto makers finally have realized that.