Whether buying computer chips directly from manufacturers, restructuring cars, or producing with missing spare parts, automakers need to be creative in tackling the global shortage of spare parts. The shortage, due to supply problems and rising demand during the pandemic, has hit the auto industry hard, with millions of vehicles around the world not being produced because of significant spare parts.
With the problem taking longer than originally expected, manufacturers, including Daimler and Volkswagen, had to rethink production strategies.
Car manufacturers usually buy spare parts from major suppliers such as Bosch and Continental, who in turn buy from raw material suppliers.
German carmaker Mercedes-Benz has set up a direct line of communication with all chip suppliers, including manufacturers in Taiwan, it said at the IAA Auto Show in September. Volkswagen boss Herbert Diess talks about “strategic partnerships” his company has with manufacturers in Asia. Chip suppliers need to be treated differently, given their strategic importance to the industry, said Stefan Bratzel of the Management Center. Car.
McKinsey’s Burkacky said automakers should consider direct investment in production or longer contracts with terms of more than 18 months.
Meanwhile, manufacturers are changing technology and strategy to manage the supply problem. Annette Danielski, finance director at Volkswagen’s Traton truck division, said the company was trying to free up space on motherboards from control systems.
“If we change the software, we can use fewer semiconductors and achieve the same functionality,” he said. “This sometimes takes a long time, because regulators intervene, but there are areas where something can change quickly.”
Daimler relies on new designs for control units. Instead of using a specific chip, they are designed to work with an alternative that can be used in case of delivery problems, said Schäfer, the company’s head of purchasing.
Tesla is considered the model for this.
The company reprogrammed the software within three months so that other rare chips could be used, enabling the US electric car maker to overcome the crisis better than many others.
General Motors said it would work with chipmakers such as Qualcomm, STM and Infineon to develop microcontrollers that combine various functions previously controlled by individual chips.
Some automakers store inventories – or what BMW calls “hole shoring”. The whole car is built except for a missing part and can then be completed relatively easily when required.
Other automakers are also using this strategy. Sometimes vehicles are delivered without certain chip-controlled functions. Semiconductors are also reserved for high-quality vehicles, such as electric cars, while customers face even longer waiting times for low-cost internal combustion engines.
This strategy is slowly reaching its limits. Volkswagen was recently forced to temporarily suspend production of electric cars at its Zwickau plant in Germany.
How well these coping strategies work is not yet clear. We hope, however, that they are effective and that cars do not become a luxury product for societies.