According to reports on Bloomberg, the likes of Ford and GM plan to introduce up to 61 new models this year, a 50% increase on any year since 2006. With suppliers having cut back production capacity during the economic downturn they are now find themselves in a difficult position to keep up with any uptick in demand.
Recent studies by the Original Equipment Suppliers Association found that auto suppliers are using 82% of their production capacity while more suppliers this year anticipate manufacturing capacity constraints, overtime pay for production workers and shortages of skilled labour.
Speaking to Bloomberg Kimberley Rodriguez, a principal at KPMG’s auto-consulting business in Detroit said: “We have fewer suppliers, we have less management talent, less engineering talent inside those suppliers, so it makes it that much more difficult to do even the same number of launches.
“That speed creates its own problems, backs things up, particularly if the suppliers can’t deliver.”
Following a speech at the Automotive News World Congress in Detroit, Ford CEO said that suppliers “really had to restructure so the issues that we’re seeing are mainly associated with them just being able to go back up and come back up”.
