Montreux, Switzerland – A lack of communication from carmakers and poor visibility in the supply chain is harming logistics providers and suppliers in the economic downturn, according to comments made at the Automotive Logistics Europe conference. The growth in car sales and global production prior to the recession also created lengthy and complex supply chains that have become unsustainable in some cases.
Nearly 200 delegates from the European automotive logistics industry attended the event, including executives from OEMs such as Ford, Renault-Nissan and Audi, and tier-one suppliers and logistics service providers of all kinds.
Transport providers and suppliers criticized OEMs for not being more transparent as the financial crisis decimated vehicle sales, with one provider complaining that it was not informed when commercial vehicle sales dropped from 26,000 to 600 in one month. Tier-one supplier Honeywell said that while carmakers were delaying new model launches, they did not always communicate that along the supply chain, leaving suppliers needlessly producing or shipping parts.
IT supplier i2 presented research indicating that manufacturers will look to shorten and re-engineer their supply chains, which were often created by chance rather than design, as companies expanded. DualproLOG said that while low-cost sourcing is not expected to end, in Europe there will be less focus on Asia, and more on Eastern Europe.
Positive projects undertaken by carmakers included successfully outsourced logistics by Jaguar Land Rover, and lower inventory and improved cash flow through synchronized logistics and productions by Renault.