The March 2014 OESA Automotive Supplier Barometer: Focus on Supply Chain was recently published. The 96 survey respondents told a story of an industry still feeling good about itself, but with a little more concern than in 2013. Pessimism increased and inventory levels were up (for finished goods and raw materials). However, overall, the survey paints a relatively positive view of the Automotive industry.
Some highlights:
- The March Supplier Sentiment Index declined slightly to 56 from a January 2014 level of 60. This included a “modest shift in opinions from somewhat more optimistic to someone more pessimistic.” Optimism arises from new business and an expectedly better European economy. Conversely, global political unrest, higher inventories and the tapering of new model programs fed pessimism.
- Just over half (51%) of suppliers saw finished good inventory levels increasing. Just under half (44%) saw the same issue with raw materials inventory levels.
- Suppliers noted that capacity, customer requirements, manpower, capital and equipment, and materials all led to internal risks with meeting production requirements. On the flip side, their own supply chain risk concerns focused on capacity, raw material and component availability, lead times and deliveries, customer and supplier requirements, tooling and equipment, financials, quality and weather.
- To manage supply chain risks, companies are increasing inventory, increasing dual sourcing, increasing investments in IT and technologies and validating alternate materials. While none of these activities are new, the survey showed them to be more predominate now than in 2013.
- Lastly, companies no longer consider traditional “low cost countries” to be the actual lowest cost to source from – 69% of suppliers noted this trend. Regionalization and localization are taking root. As noted in this blog recently, Mexico will soon be the No. 2 supplier of vehicles to the U.S., in part due to its regional location.
Disclaimer
This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.
Related Insights
13 February 2025
Energy Current
Texas’ Power Transmission Infrastructure: Addressing Growing Demand from Data Centers and Crypto Mining
Texas is facing a rapidly evolving energy landscape, driven in part by the surging power demands of data centers and cryptocurrency mining operations.
13 February 2025
Blogs
Foley Kicks Off 2025 at Infocast Projects & Money: Industry Insights and Policy Predictions
A large number of key players in the renewable energy industry kicked off their 2025 in New Orleans, Louisiana for the Annual Infocast Projects & Money conference.
13 February 2025
Health Care Law Today
Understanding the Legal Pitfalls of Virtual Second Opinions: What You Need to Know
Virtual medical second opinion programs continue to roll out across the country, delivering expert recommendations to better help patients’ diagnoses or treatment options.