Summary
- Over the past few years, different regions experienced different levels of disruption to their supply chains
- North America was the hardest hit, as it is the farthest away from most major supply sources
- Conversely, Asia-Pacific and European markets were able to remain relatively stable
- The E.U. saw the least disruption, as buying a vehicle there is often a long decision making process due to the abundance of viable public and long distance, high speed transport
- We think that if the North American manufacturers had relied less on “just in time” supply, as well as had a stockpile of parts for mass production models, the disruptions in production of the past few years could have been economically minimized
A while back, we did an analysis on the supply chain “ripple effect” from the global pandemic. The key takeaways from that analysis was that “just in time” supply and the silicon shortages after the pandemic were driving prices up, as well as decreasing overall inventory of new cars.
What we did not properly dig into at the time, however, was that there is a third and very significant impact on the supply chain: Region.
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