Toyota Motor Corp (NYSE:TM) And Honda Motor Co Ltd (ADR) (NYSE:HMC) Lead The Charts Of Having The Best Supplier Relations Within The Auto Industry

For the longest time possible, and according to a study that has just been concluded, Toyota Motor Corp (NYSE:TM) and Honda Motor Co Ltd (ADR) (NYSE:HMC) have continued to lead the charts of being the best in supplier relations. This is the fifth year in a row that Toyota is being named followed closely by Honda and Ford Motor Co getting the third position.

Nissan Motor Co was categorized in the fourth place while General Motors Company (NYSE:GM) and Fiat-Chrysler Automobiles NV had a tie for the fifth position. The six companies are not only the largest automakers in terms of sales in the US market, but they are also the strongest within the auto industry.

Applauding the two leading companies, the study’s author, John Henke, emphasized that for any Company to make profits, it must be in good relations with its suppliers. Henke, who is the president of Planning Perspectives and a marketing professor, stated that Toyota Motor Corp (NYSE:TM) and Honda had notable improvement of 8.7% average score.

However, he added that the other four still had a chance to improve their relations as much to hit a margin of $2 billion operating profit collectively. The study showed that had GM earned another $750 million as at last year; they would have been at 8.7% in their score of improved supplier relations.

In the recent past, suppliers have become more particular and keen of what Companies they are dealing with. A majority of them will not just go for business from any automaker, according to Henke, who has conducted a study of relations of automakers for the last 15years.

The truth is as a human you want the best technology that will serve you best. Hence, the tight competition between the automakers. Parts suppliers are no longer building plants for automaker business.

For this reason, suppliers are playing it safe and will not support any business that comes their way. Their reasoning is that they don’t know what to expect for tomorrow, especially after the 2008-2009 recession.

 

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David Barry

David Barry

Barry is a senior journalist at Us Markets Daily. He reports, shoots and edits many of his own stories by himself.