Tuesday, May 4, 2021

Just in Time, Isn't

New Ford F-150 pickup trucks were unableto be sold because of the global
 shortage of semiconductor chips
From the Wall Street Journal

Tuesday taunts me.

As I wake in the morning, Tuesday says to me, I am not Monday and I am not Wednesday--what are you going to do today? 

I struggle with that. 

This Tuesday is seems that the auto industry is struggling with something that the U.S. military did away with a decade ago--Just in time logistics. 

According to an article in this morning's The Wall Street Journal titled, 

It doesn't work during wartime because there are too many things that need to be controlled for it to work. 

COVID-19 has exposed the weakness in the system and that in resulting in production problems for manufacturers. From the article:

The hyperefficient auto supply chain symbolized by the words “just in time” is undergoing its biggest transformation in more than half a century, accelerated by the troubles car makers have suffered during the pandemic. After sudden swings in demand, freak weather and a series of accidents, they are reassessing their basic assumption that they could always get the parts they needed when they needed them.

“The just-in-time model is designed for supply-chain efficiencies and economies of scale,” said Ashwani Gupta, Nissan Motor Co.’s chief operating officer. “The repercussions of an unprecedented crisis like Covid highlight the fragility of our supply-chain model.”

It is fascinating to watch manufacturing giants relearn what they thought they knew as the global economy becomes more entwined. 

The manufacturers are moving to a hybrid system where the most critical parts are stockpiled. Toyota, according to the article, is stockpiling a 4 month supply of some of its critical parts. 

"Just in time" is used by other corporations as well and the pandemic coupled with the Texas weather event is forcing a rethinking of how supplies should be stockpiled. 

Maybe "just in time" is finally becoming "in the right amount." Just a thought.

-- Bob Doan, Elkridge, MD

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