As automakers ramp up production, a third of North American suppliers say they don't have capacity to meet their customers' requirements.
Of the 100 parts makers surveyed by consultancy A.T. Kearney this year, 37 percent say their ability to make parts is below their customers' capacity planning volumes -- what they are obligated to be able to supply if the automaker raises output beyond initial forecasts. Within that group, a third are more than 20 percent below requirements.
"Because they significantly reduced capacity" during the downturn, said Daniel Cheng, head of Kearney's automotive practice, "the question is how many didn't make the investments they were supposed to make for this uptick in volume."
He added: "The critical period is pretty much now as volume starts to increase."
Options beyond working overtime are limited for many suppliers.
"If capacity is needed, 64 percent of surveyed suppliers said access to capital would be difficult," meaning they might not be able to fund the extra capacity that automakers want from them, Cheng said.
Production is growing as auto sales recover. Kearney expects U.S. sales to rise to 13.2 million light vehicles this year from 11.6 million in 2010. And it forecasts 16 million sales in 2013, 38 percent higher than 2010.
Automakers must change how they manage their supply-chain risk, Cheng said. He urged manufacturers to monitor second- and third-tier suppliers actively instead of delegating that authority to their Tier 1 suppliers and to "know where the choke points are."
Because the survey was completed before the March 11 earthquake in Japan, it may understate supplier capacity limitations.
"The Japan earthquake and some of the slowdown has actively masked some of the capacity risk," Cheng said. "As production starts to increase to make up for lost production, you're going to see more and more of the capacity risk start to manifest itself."