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Ford Launches New Supplier Program Amid Strained Relations

The COVID-19 pandemic had a tremendously destructive impact on Ford – not to mention many of its peers and companies in other industries – one that continues to perpetuate to this very day, particularly in regards to supply chain issues. Even after making numerous executive changes and taking steps to mitigate these impacts, Ford has seen its rankings in the Plante Moran North American Automotive OEM – Supplier Working Relations Index (WRI) Study decline over the past few years, shedding more points than any other U.S.-based automaker and landing in next to last place for 2024. Now, shortly after Ford asked suppliers for help in regard to finding cost savings for EV components, the automaker has launched a new supplier program aimed at improving relations, according to Automotive News.

Ford F-150 Lightning Rouge Electric Vehicle Center Expansion - Exterior 002 - Rear Three Quarters

As it works to improve communication with suppliers and address quality and cost concerns, Ford is ditching its Aligned Business Framework, which it has used since 2005, according to Liz Door, the company’s chief supply chain officer. That program was initiated with the intentions of handing out long-term contracts to a smaller group of suppliers in exchange for more details pertaining to their production capabilities and finances.

That program is being replaced with what FoMoCo calls Engage, which aims to round up more suppliers, make communications deliberate and goal-oriented, and measure performance based on quality, cost, and delivery metrics, according to Door. Engage will lead to more meetings, in-person visits, and business reviews with suppliers, all with an increased focus on advanced product quality planning.

Ford Rouge Electric Vehicle Center F-150 Lightning Production Process - Exterior 001 - Front Three Quarters

“It’s absolutely paramount that we have strong relationships with our supplier partners,” Door said. “Those interactions, they have to be quality interactions and they have to be focused on execution and collaboration and getting things done in a timely manner. We get ideas around feature content, reduction in mass and materials perhaps that we’re using that may not be aligned with the industry. There’s lots of different ways to do value engineering. Ultimately the win-win is when we find a mutual benefit with the suppliers.”

We’ll have more on Ford’s supplier relations soon, so be sure and subscribe to Ford Authority for continuous Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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Comments

  1. John Markee

    Remember the Deming Quote, “Before you can find two good suppliers, you must first find one.” Adding multiple suppliers can adversely affect the vehicle quality. Be careful as you proceed.

    Reply
  2. Bruce Holberg

    Ever see more trite business jargon in one statement? OMG.

    Reply
  3. Bob Z

    when you depend so heavily on outside suppliers there is always a chance that some will take advantage of that needy disposition or slack off on quality control to meet the contract demands. it is the way it has always been, just now, with the nuances of the pandemic still affecting most industries it has grown more common and insidious.

    Reply
  4. Scott

    Ford has bankrupt more suppliers than can be counted. You notice it’s not about improving quality,it’s about reducing cost. That cost reduction is not passed on to the consumers. As a vendor when you sign a contract to supply Ford ,before you have even made the first part Ford wants %20 cost reduction every year of the contract. The suppliers have to negotiate those numbers but it usually runs around a %7 reduction yearly on average. And Ford continues to come after you with charge backs for “bad parts” that’s why alot of the vendors have thrown in the towel and have gotten out of the Automotive supplier business. It’s not profitable

    Reply
    1. Scott

      Sorry it was supposed to read %10 not % 20

      Reply

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