Keep these complaints in mind when GM and the UAW start asking for Billion$$ in tax payer bailouts in the near future...
Posted on 05/31/2005 7:46:35 AM PDT by Last Dakotan
Detroit - Auto-parts suppliers' trust in General Motors Corp. is at its lowest level in 15 years, according to a survey by a Michigan consulting firm.
Eighty-five percent of the suppliers questioned who work with GM reported a poor working relationship and just 3% said they have a good or very good relationship. Fifty-three percent of suppliers said they prefer not to work with the world's largest automaker, saying the company has little regard for suppliers' financial stability.
Planning Perspectives Inc. questioned 259 suppliers in March and April about whether automakers help or hinder them, how well they communicate and how much potential they have to make a profit. The employees questioned were generally sales people who work directly with automakers. Planning Perspectives President John Henke said the company has been studying automaker-supplier relations since 1990. The latest survey is to be released today.
(Excerpt) Read more at jsonline.com ...
As someone who has sold to GM and Chrysler, I can certainly understand why. The auto makers like their suppliers to cut the price for the same product every year, sometimes 10-20 percent a year for each year of an agreement. Yet, their finished products cost more every year.
GM has for years now been downright abusive to their suppliers, including key suppliers with whom they have long relationships.
I have been in the past a supplier to GM, and I have friends who are today, and the consensus is that dealing with GM is just not worth the aggravation any more.
They haven't realized that it's not their suppliers' fault they can't make money - it's the miserable products they offer!
You know a company is in trouble when both the customers and suppliers don't think too highly of it...
I spent fifteen years as an automotive supplier rep. GM directives were quite simple:
1: diversify your work force to meet their equality requirements.
2: Undercut your profit margins by a minimum of 5% per year
3: Move your operations off shore to approved economic development areas.
Do all of this and they may let you stay on as a supplier.
In the end, it's a losing proposition to bid on any work for GM.
Japanese transplant operations are the best customers a US supplier can work with now.
Does is seem strange that the only people surveyed were the sales people?
All the auto manufacturers do it. The trick is to not let them become your sole source of income.
GM is not in the business of making cars, GM is in the business of paying union benefits and pensions. The car "thing" is incidental.
No. They usually know first what is happening.
Keep these complaints in mind when GM and the UAW start asking for Billion$$ in tax payer bailouts in the near future...
I have often wondered why GM has always reserved the stick for their suppliers, never for the UAW?
We quit bidding, except for spot sales. We also required payment in net 10 days.
any thoughts on hyundai and its new plant outside birmingham?
The UAW is the only one that can really hit them where it counts. They will shut a line down at the drop of a hat. If a supplier shuts a line down, it's an $80K/hour hit.
I've seen operators shut down lines if you look at your watch while on the floor claiming unapproved time-study activities.
Same thing has happened to Maytag in Newton, IA. Management has been particularly stupid and the UAW has offered no help.
Between this and the outsourcing, GM deserves anything they get.
GM is plenty nasty to it's white-collar contract employees.
The Southeast is the new hot bed for supplier/transplant operations. Favorable tax structures and a break from the rust belt union mentality make it the place to be these days. As for Hyundai, I've not looked there enough to have an informed opinion.
True.
But CEOs change frequently and a good customer can become a bad one overnight.
Some new CEOs want to maximize current stock values by short term schemes to increase cash flow. They drift from company to company getting millions annually in stock options, bonuses and severance packages while leaving devastated companies in their wake.
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