Nissan, FCA lag in study of North American auto supplier relations

DETROIT, May 16 (Reuters) - Fiat Chrysler Automobiles (NYSE:FCAU)
FCHA.MI FCAU.N and Nissan Motor Co 7201.T are lagging
behind top North American competitors in the health of their
working relationships with suppliers, an annual study found on
Monday.
As in prior years, Toyota Motor Corp 7203.T and Honda
Motor Co 7267.T ranked first and second in the study, which
looked at the six biggest automakers in North America. Ford
Motor Co F.N was ranked third and General Motors Co (NYSE:GM) GM.N
fourth.
Automakers' profitability is linked to good working
relations with their suppliers, said study author John Henke,
head of Planning Perspectives, a firm that focuses on
company-supplier relations in various industries.
Major automakers spend 70 to 80 percent of their revenue on
parts, components and materials from suppliers. Henke's research
has shown that automakers make more profit when they have better
working relations with suppliers, in part by getting price
concessions and gaining access to the best products.
"Strong, profitable industry-leading companies are those
with the strongest, collaborative supplier relations," said
Henke.
The study covered 2015 and does not offer a figure for
profit lost due to poor supplier relations. A year ago, Henke
estimated that in 2014, automakers collectively could have added
$2 billion in operating profit by improving working relations
with their suppliers.
Since the study began in 2002, Toyota has been first and
Honda second in supplier relations, except for two years when
the two Japanese automakers swapped the two top spots.
The study shows the results of surveys of 647 salespeople at
492 suppliers to the six automakers. The study uses survey
responses to illustrate basic business practices and automaker
behavior in buying and purchasing situations involving
automotive materials, parts and components.
Using a point system devised by Henke and based on survey
responses, the six automakers were ranked.
GM, which last year was tied for last place, improved the
most in its relations with suppliers in the past year, Henke
said.
Fiat Chrysler was at the bottom of the six automakers
studied, closely behind Nissan. FCA has been either last or next
to last in the study since 2008. Nissan dropped the most in the
past year, partly because Nissan representatives became
adversaries with suppliers and applied intense pressure to drop
prices, Henke said.