Suppliers just say no to this automaker most often
|David Sedgwick is a senior writer for Automotive News.|
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If a recent survey by IRN Inc. is any indication, suppliers are learning to just say no when their customers demand price cuts. And you might be surprised which automaker gets rejected by suppliers most often.
Last month, the survey asked 130 suppliers how they responded when customers sought price reductions on existing contracts.
Thirty-six percent of those who supplied Toyota said they gave the automaker a price cut of zero percent. As in none at all.
Twenty-nine percent of Nissan suppliers granted price cuts of zero, and 27 percent of Ford suppliers did likewise. Twenty-two percent of General Motors suppliers rejected any price cuts, while 19 percent of Chrysler suppliers did so.
Suppliers were most accommodating with Honda. It got flat rejections from only 17 percent of the suppliers in the survey.
Granted, suppliers are rejecting price cuts at a time when North America's auto industry is straining to keep up with rising production. It will be interesting to see how quickly this trend reverses when production starts to decline.
You can reach David Sedgwick at firstname.lastname@example.org.