In the contest to build better supplier relations, the Big 3 are still losing ground to the Japanese import brands.
A study released Monday finds that for the fourth straight year, Big 3 suppliers are unhappy with their customers. They also are more mistrustful of Big 3 business methods. And they are less willing to share technology with them or invest in their products than the suppliers of Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co.
And it is definitely a contest, says supplier consultant John Henke Jr., who conducts the annual survey.
"The suppliers are saying that the Big 3 are doing nothing to improve supplier relations, and in fact, are falling further behind the Japanese in their relationships," says Henke, president of Planning Perspectives Inc.
The Birmingham, Mich., company surveyed 223 Tier 1 suppliers about 852 different business contracts with carmakers.
Henke says the message is clear. "If the Big 3 don't change their ways, their competitiveness is going to slowly erode," he says.
Suppliers say they are shifting resources from the Big 3 to better serve Toyota, Honda and Nissan in North America.
The suppliers also say the biggest reason they agree to give price concessions to the Big 3 is a fear that the customer will cancel business or take other retaliatory measures against the supplier.
Suppliers to Honda, Toyota and Nissan say they offer price concessions because it will help them increase or maintain market share.
On the same question, more than 25 percent of Honda's North American suppliers said they grant price concessions out of loyalty to Honda.
Only 3.6 percent of Ford Motor Co.'s suppliers said they granted price concessions out of loyalty.
The fallout from this type of relationship turmoil is serious, Henke says.
The survey indicates that suppliers are compensating for their Big 3 product price reductions by reducing r&d spending to support those projects.
By contrast, suppliers for the import brands say they are either maintaining funding or increasing their investment - despite granting their customers price reductions.