Supply Chain Risk = early exit?

[Guzz226]

With all 3 majors now declaring their exit strategies, what risk is there of a supplier going under earlier and bringing everyone down with them ahead of time??

We have seen issues in the past where issues with an odd supplier has caused production delays - I'm wondering if all the required suppliers will be able to stay in business long enough to keep feeding Ford, Holden and Toyota the parts they need for the next 3 years given they will all be facing the same fate or trying to reinvent their business to stay afloat.

When you see the numbers of how many suppliers are involved to support the bug 3 and presumably a large number of them are shared across the board it is quite a worry how much has to go right over the next 3 years for the exit strategies to go to plan.

I hope I am well wrong but I think it is a risk that really hasn't been considered given the top down focus to date.

[Soulsearcher]

It's been 10 years since I've worked at an automotive supplier, but even back then there was a fair amount of consolidation happening where locals were being purchased by multinationals.

For these suppliers, I don't think that there's going to be too much of a risk of them leaving early, only because these multinationals will have contracts in place worldwide with Toyota / GM & Ford & won't want to run the risk of losing future contracts.

As for the genuine locals though, I'm not sure how many are still left & of those which ones are specialised enough that they can't be fairly quickly replaced by another supplier even if it is overseas based one (Toyota in particular having a world car wouldn't be affected to a large degree, although it'd be at a cost).

All of the tooling and dies that we used (worked for two different suppliers) were owned by the car companies, and if anything ever happened we would have to hand them back.

[SB076]

I know of one company that has decided to sell of a particular machine that is used in the automotive industry, that will cause minor issues for the industry. It will cause some issues but basically the machine was running at a loss so they have decided to get rid of it whilst they can.

P&A will be interesting as a lot of the supply chain will simply shut up shop and won't exist

[Dauphin]

I was thinking about this. People in this industry will already be considering what to do next and one by one will drop off into another job while they can find one (before it becomes even more competitive for jobseekers in this country). The companies may have to beg people to stay with lucrative pay which they just can't afford to provide.