If the industry wasn't already deep in the throes of one crisis, a tornado strike on an important supplier plant in Seneca, S.C., this month would have handed it another — suddenly limiting the supply of BorgWarner transfer cases used by several automakers in the production of many of their highly profitable four-wheel-drive pickups and SUVs.
The fact that idled assembly plants give automakers more time to find a workaround qualifies as a silver lining to the pandemic.
It also brings to mind a long-overdue task automakers and suppliers should be aggressively pursuing while they wait for full production to return: fully and transparently mapping out their supply networks.
This industry learned a hard and valuable lesson in 2011 when the earthquake and tsunami that devastated Japan revealed that a single factory in Onahama — within 30 miles of the ill-fated Fukushima-Daiichi nuclear reactor — was the sole source of the aluminum-flaked paint pigment Xirallic, used extensively by global automakers in metallic paints for vehicle exteriors.
In the aftermath of that disaster — after months of lost, limited or slowed production — Tier 3 supplier Merck KGaA, which operated the plant, spread out its stockpiles globally and developed alternatives to Xirallic to safeguard against a repeated interruption.
And automakers, many of which were unaware that the Onahama plant was such an important piece of their supply networks, vowed to finally figure out just who was supplying the components in their vehicles and from where they were coming.
It was a noble gesture, and one sincerely undertaken. But for many automakers, the mapping project ultimately fell victim to the low-cost demands of mass production. Tier 1 and Tier 2 suppliers remained opaque about their own purchasing habits, and automakers failed to secure alternative sources for key inputs.
But as this industry prepares to eventually resume production around the globe after weeks of shutdown from the COVID-19 pandemic, think of how valuable such a map would be to each automaker.
Getting the wheels of production moving again would be much less fraught if each automaker knew in advance that all of the spokes were ready to go.