Bill Ford: Fewer suppliers but ''they will be much more strategic.''
Company CEO Bill Ford has blanketed TV airwaves with commercials in which he brags about the company's technological innovations. But that promise will be hard to fulfill if Ford suppliers withhold their best technology.
So Bill Ford says he is trying to win back their trust. "We will have fewer suppliers, but they will be much more strategic," he said. "Their pledge to us is yes -- we will get their latest and greatest technology."
In October, the automaker launched a multimedia advertising campaign pledging that innovation will be the hallmark of its brands. Last week, Bill Ford said suppliers' lack of trust is "one of the last stumbling blocks" to fulfillment of that pledge.
Ford Motor's combative purchasing policies have been a chronic irritant. Parts makers sometimes retaliate by offering Ford's competitors first crack at their latest technology.
On Sept. 29, the automaker made a major bid to mend relations. Ford Motor will cut the number of its key suppliers in half.
Those that remain will start working with Ford earlier in the vehicle development process, and they will have an opportunity to win more business.
So far, Ford Motor has named 12 companies on its preferred supplier list. On Dec. 1, it is expected to add about 10 more suppliers to the list. And Ford will quietly drop some suppliers, too. Over time, Ford Motor will whittle its key suppliers down from 200 to 100 or fewer.
It won't be enough simply to ask Ford Motor purchasers to be nicer to suppliers, Bill Ford acknowledged. The automaker must demonstrate it with its actions.
"Until they see that and until they live it, there will probably be a natural, healthy level of skepticism," Bill Ford said. "But we are committed to proving that to them."
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