Manufacturing preserve & recalibrating to protect operational stability in automotive supply chains

Manufacturing preserve & recalibrating to protect operational stability in automotive supply chains

Situation:

  • COVID-19 is causing unprecedented risks and challenges to global automotive supply network

  • OEMs are monitoring inbound material with task team to find parts and prevent shortages in their supply chains as the spread of the coronavirus rattles markets and threatens to roil manufacturing processes globally

  • It is difficult to predict where this crisis is going or how it will impact operations

  • Consumer behavior and demand will also be affected by the crisis and the global financial consequences

  • Shortages of critical components may slow down production or prevent restart

  • Some regions may be affected more than others at different times opening up windows to mitigate risk

    Advice:
     

  • Perform cost benefit analysis on identifying alternate modes of transport to cut lead times and replenish critical inventory items
  • Work with suppliers to co-develop plans, resolve bottlenecks, support liquidity issues, and achieve supply stabilization, include extended chain as required
  • Act swiftly to identify and build relationships with alternate suppliers especially in less impacted regions to secure additional inventory and capacity 
  • Prioritize production plan based on customers, product margins, available inventory, and ability to secure supplies from the extended supply chain
  • Continuously update and monitor supplier health indicators to enable developing  suitable mitigation plans and minimizing potential impacts

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