Marques promise fair deals with suppliers

Japanese carmakers have announced they are adopting a policy to treat smaller companies and parts makers more fairly.

The Japan Automobile Manufacturers Association (JAMA) says the approach advocates that the business transactions of its members with suppliers be “conducted fairly and equitably”.

The move comes as the practice of big corporations using their market dominance to try to contain prices charged by subcontractors remains a concern, reports the Japan Times.

Masanori Katayama, pictured, JAMA chairman, says: “We take this matter very seriously. Our 14 member companies are committed to shaping up to promote business transactions throughout the entire supply chain based on the premise of legal compliance.”

JAMA’s new policy states original equipment manufacturers will accept the passing on of all basic costs and energy and raw material price increases incurred by their subcontractors.

Carmakers have also agreed to consult with suppliers about possibly absorbing labour-cost increases.

JAMA notes it is also working with the Japan Auto Parts Industries Association across the supply chain to ensure the competitiveness of Japanese manufacturing and to maintain a sound and sustainable trading environment. 

In March, the Japan Fair Trade Commission reported that Nissan unlawfully slashed payments by about ¥3 billion (about NZ$31 million) to 36 subcontractors between January 2021 and April 2023. Nissan has settled this amount with the suppliers, reports the Japan Times.

The commission warned the company not to engage in unfair bargaining and asked JAMA to instruct its members to take measures against such behaviour as similar cases involving parts makers have occurred in recent years.