FCA has poor relations with its auto suppliers, study shows image

Fiat Chrysler keeps on staying behind its main US rivals when it comes to the collaboration with auto parts makers, according to an annual study on the matter.

The Planning Perspectives firm is conducting every year a survey that examines the working relations between auto parts makers and their North American-based customers from the suppliers’ perspective. And the recent study, which covered 2015, has showed that Fiat Chrysler continues to lag behind its competition, followed closely by Nissan, which surprisingly dropped the most. According to John Henke, head of Planning Perspectives, Nissan’s fall is a consequence of its aggressive approach toward suppliers, by applying intense pressure to force them to drop their prices. As for FCA, it has been either last or next to last in the survey since 2008 because “they’re doing the wrong things,” as Henke said. For the past year, General Motors improved the most in its relations, finishing on fourth after it was tied for last place for 2014, while Ford was ranked third.

The leading automaker in its connections with suppliers is still Toyota, with Honda just behind it, as both have been in these spots since the study began in 2002, except for two years when they swapped places. This study, which gathered responses from 647 salespeople at 492 suppliers to the six biggest US automaker, shows that “strong, profitable industry-leading companies are those with the strongest, collaborative supplier relations,” said Henke. Even if the recent report did not provide any estimates of profit loss because of poor supplier relations, the study last year, which covered 2014, showed that Ford, General Motors, FCA US and Nissan would have collectively earned 2 billion dollars more in operating profit if they had improved their relations with suppliers as much as Toyota and Honda did during that year.