Case: Toyota, Ford, Gm and Volkswagen- Some Differing Opinions About Working with Suppliers

Topics: General Motors, Automotive industry, E-procurement Pages: 3 (1223 words) Published: February 12, 2008
CASE: TOYOTA, FORD, GM AND VOLKSWAGEN- SOME DIFFERING OPINIONS ABOUT WORKING WITH SUPPLIERS. CASE SUMMARY: The main issues at stake in this case is the working relationship Toyota has with its suppliers, compared to other Auto manufacturers such as ford and General Motors. Another critical issue is which sets of parts should be standardized. Both Ford and GM have embraced the concept of an electronic market place for motor vehicle parts. The AutoX-change as it is called would bring automakers and their suppliers together. The rational for this e-market place is that it would drastically reduce costs by providing suppliers with more business opportunities. Toyota on the other hand tends to see its suppliers as partners. By engaging suppliers in long-term contracts, it is hoped that they would reduce prices. Toyota's fear is that engaging in the AutoX-change would create and adversarial relationship with themselves and suppliers. The sub-plot to this case is the standardization of auto parts sold in Europe. Toyota has been experiencing lagging sales in Europe. Once again, Toyota is at difference with VW and Ford. The main point of contention as it related to standardization resulted from the definition of "competitive components". Toyota had a much wider range of parts in this category than GM and VW. SWOT ANALYSIS. STRENGTH This market place will provide manufactures with more components to choose from. The online marketplace could help reducing costs to the manufacturer. It also has the potential to provide suppliers with more business, considering that they would be able to view the needs of the manufacturers online. Another strength of the proposed e-procurement site is the financial strength and backing it would have considering that it is being spearheaded by the likes of GM and Ford. This would create a "click- and-mortar" type company. WEAKNESS The main weakness of such a system is that companies like Toyota would no longer be able to treat suppliers as...
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