Material shortages are forcing a supply chain rethink in automotive

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In the face of material shortages across the board, carmakers and their suppliers are looking a range of radical alternatives as part of drive toward more sustainable closed-loop supply chains

Shortages in electronic components and semiconductors are costing OEMs dear in production and logistics. Losses in output are likely to impact overall new vehicle sales volumes as well. However, headlines around semiconductors and computer chips can miss the fact that many other commodities are currently in short supply, from leather and fabrics, to steel and rubber.

These supply chain issues may not be shutting down production lines but they are likely to hit the bottom line of many manufacturers with significant price increases. That is leading to a serious rethinking of many current supply chains. OEMs are already making more use of control towers, asset tracking and other data, as well as digital tools to improve visibility of the supply chain. However, manufactures are also looking at changes in sourcing, including having additional supply options, or new alternatives altogether.

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