Posted Apr 17th 2012 8:28AM
Economies of scale, globalization and production efficiencies continue to exacerbate any disruptive incident in an automaker's supply chain. The latest snafu is due to a fatal explosion at Germany's Evonik Industries, which arrested that company's ability to produce cyclodecatriene (CDT). In turn, the production of the resin Vestamid Polyamide 12 (PA-12) is threatened by the loss of CDT, one of its key components. And a crimp in PA-12 supplies threatens the manufacture of crucial components like brake-line coatings and flexible hoses.
Auto-industry analysts have described the issue as "serious," but no one, including automakers and suppliers, is sure of how grave the issue will be. Michigan-based Tier One carmaker supplier TI Automotive is hosting a conference later this month with competitors and carmakers to discuss the issue. The major car manufacturers have said they are monitoring the situation, but no disruptions have been planned for yet.
News Source: Bloomberg
Image Credit: Patrik Stollarz/AFP/Getty