Editorial: The path to an all-EV future depends on strong automaker-supplier partnerships

The path to an all-EV future is muddier than it was three years ago. One thing, however, is abundantly clear: Automakers and suppliers must make progress as partners and not adversaries.

That sentiment was echoed as recently as Aug. 6 by a panel of executives — who are tasked with finding that elusive balance between government regulations and consumer demand — at the CAR Management Briefing Seminars in Traverse City, Mich. Electric vehicle sales aren't taking off as initially planned, with high costs and questions about charging infrastructure weighing on consumers. Automakers have been forced to pivot and temper initial outlooks, delaying some EV production and putting more emphasis on hybrids.

Suppliers are caught in the middle.

This month, Magna International Inc. took the unusual step of lowering its 2026 financial outlook because of EV uncertainty and contract assembly woes. Magna CEO Swamy Kotagiri put it succinctly: "The market has shifted drastically."

Other suppliers have said the rapidly changing plans will weigh down earnings. Add to this a tight labor market, costly raw materials and high interest rates and it's not difficult to imagine a stressed supplier base.

As those red flags are raised, we're reminded of the good and bad on the latest supplier scorecard from Plante Moran's annual survey. It was encouraging to see five of six automakers tracked by the survey improve their scores from a year ago. More discouraging was seeing Ford Motor Co.'s score fall and Stellantis remaining at the bottom of the pack, despite a small year-over-year improvement.

The race to profitable, mass-market electrification is going to take every ounce of brain power the industry has to muster. The days of automakers driving all the innovation and suppliers simply fulfilling orders have long passed. Suppliers are a significant source of new ideas.

If there ever was a time for automakers to play the long game with suppliers, this is it.

Toyota has prioritized collaborating with suppliers for years and leads the Plante Moran survey. In February, the carmaker said it would pay higher prices to Japanese suppliers to incentivize faster production and better working conditions.

As challenges mount, the prize is greater than ever, and we'd like to see more of that kind of leadership.