OEMs begin plans for supply chain contingency fearing disruption from Icelandic volcanic eruptions
Emergency logistics expertise helps safeguard automotive industry production amid ash cloud uncertainty
A number of major OEMs have begun looking at contingency planning, as the automotive industry fears a repeat of the Icelandic ash cloud that devastated global flight schedules and led to costly production line delays. With news that the Bardarbunga volcano eruptions continue to increase in magnitude and lava spews 60 metres into the atmosphere, vehicle manufacturers are keen to avoid a repeat of the disruption caused by grounded flights in 2010, advises emergency logistics specialist Evolution Time Critical.
“September is a traditionally busy period for automotive logistics as OEMs and suppliers work to replenish buffer stocks that have been heavily drawn on during seasonal shutdowns,” says Evolution Time Critical managing director, Brad Brennan. “Lean supply strategy and the requirement of a diversifying range of components to meet broadening model ranges, means that 2014 buffer stocks have needed to be smaller and therefore won’t stretch as far as in previous years.
“The possible threat of flight disruption means that it is crucial for vehicle manufacturers to work harder than ever to ensure contingencies are in place where possible,” continues Brennan. “The inflexibility of lead times provides an obstacle for suppliers keen to get ahead and protect against potentially disruptive flight cancellations. In such cases, the strategic use of emergency logistics expertise offers potential solutions to build up reserve stocks in advance, or find alternative routes during a crisis.”
Current forecasts are unclear as to whether a resultant ash cloud is imminent, but a number of OEMs are taking no risks, advises Evolution Time Critical. “We have spoken with a number of customers that are proactively looking at contingency planning to secure robust processes, as vehicle manufacturers and suppliers are increasingly aware of the cost of supply chain failure,” says Brennan. “The globalised production footprint of automotive supply chains means that the ramifications for being unprepared for widespread flight disruption could affect markets worldwide. The worst case scenario of utilising proactive contingency is that there is no direct impact from the Bardarbunga volcano, but OEMs are heavily protected against future supply chain nuances; whereas the cost of failure through lack of preparation could run into millions.”
www.evolution-timecritical.com
About Evolution Time Critical
Evolution Time Critical is the world’s leading specialist in emergency logistics for the automotive industry. Analysts are available 24 hours a day, ready to develop and implement solutions in any part of the world within a 15-minute response window, calling on a vast range of techniques, skills and contacts to ensure that goods reach their destination on time.
The skills of Evolution’s team are also available for consulting projects, helping clients to achieve additional savings in their supply chains while also strengthening and improving manufacturing efficiency. Increasingly, Evolution has found that emergency logistics is playing an integral role in lean strategies as the automotive industry returns to higher production volumes, allowing further inventory reductions while maintaining the reliability of deliveries to manufacturing plants.
The expertise and techniques developed by Evolution for the automotive sector are also benefitting the aerospace and marine industries, where the company helps clients to release capital trapped in spare parts by facilitating urgent parts deliveries, and return aircraft and ships to service more quickly.
Press Contact
Gareth Charlton at Market Engineering
+44 (0)1295 277 050
gareth.charlton@m-eng.com
Sales and Marketing Contact
Brad Brennan at Evolution Time Critical
+ 44 (0)1332 814 914
bbrennan@evolution-timecritical.com
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