Suppliers rank BMW as No. 1 auto innovator

BIRMINGHAM, Ala.--North American parts suppliers consider BMW AG the best automaker for adopting innovations into vehicles, according to an Automotive News study compiled with J.D. Power and Associates.

Toyota Motor finished second and Honda Motor ranked third in the Automotive News 2009 OEM Supplier Innovation Study.

Ford Motor showed a huge improvement from the last study in 2007. The company vaulted from last among the major automakers into fifth place.

Bankrupt General Motors was ranked as the worst automaker in North America for incorporating innovations into vehicles. Chrysler LLC dropped dramatically and finished just ahead of GM.

Tuned to technology

Here's how suppliers ranked automakers on openness to and implementation of innovation, and willingness to share the rewards.

Source: Automotive News 2009 OEM Supplier Innovation Study, based on a 1,000-point scale

Getting innovations first

It is clear from the study that automakers with a culture for trying innovations and rewarding suppliers for those breakthroughs obtain the newest technologies first, said Mike VanNieuwkuyk, executive director of J.D. Power's automotive product solutions unit.

"Innovations are supposed to benefit both parties," said a supplier executive who participated in the Web-based survey. "They will be offered to OEMs that are willing to share the benefits."

Suppliers judged each automaker's North American operations on five factors related to innovation: openness to ideas, trust, ease of working with the automaker, willingness of the carmaker to share financial rewards, and ability to implement innovations.

BMW was the best automaker to approach with new technology, suppliers decided. The company saw its index rise 29 points from the last study, to 716 out of a possible 1,000 points.

Supplier executives were effusive in their praise of BMW's approach to innovation. "Extremely proactive in leading technological innovations," said one executive.

Said another: "Team player. Strives to be the best. Pays more money for more value/technology."

Remarkable rise

Ford's rise was remarkable this year, VanNieuwkuyk said. The company posted a record 108-point gain over its index performance in 2007.

In the 2007 and 2004 surveys, Ford was viewed as uncompetitive in all five categories. Supplier executives saw a turnaround; Ford is viewed now as above average for innovation.

"Ford recognizes that new ideas are necessary to compete in the new economic environment and with the increasing pace of technology," one supplier executive said.

Another executive still sees limitations, though, in what Ford is willing to pay for technology. Ford, that respondent said, "tries to lock profits for Ford rather than share, even though the supplier brings the innovation."

(Source: Automotive News)