Factors combine to create perfect storm threat to North American automotive supply chain robustness
Emergency logistics expert Evolution Time Critical has been working with automotive manufacturers and their suppliers to move vital components from Europe and China as a result of cargo being delayed at North American ports. A number of factors are combining to put the region’s infrastructure under increasing pressure to create a perfect storm for the automotive supply chain: continued recovery from natural disasters and poor weather, the new Electronic Logging Devices (EDL) mandate and shortage of available trucks and drivers has led to a threat of critically short supply to some suppliers.
“Seafreight is a vital aspect of the automotive supply chain, but due to lean inventory or stock availability there is often minimal margin for error,” explains Brad Brennan, managing director of Evolution Time Critical, which operates a control centre in Atlanta, GA. “Customers are currently telling us that they are experiencing delays of weeks caused by this perfect storm of events, resulting in the need to secure new parts from the origin suppliers and bring them in as fast as possible.”
Infrastructure in the area is still recovering from significant weather damage, and a number of factors that would normally be more easily manageable in isolation are combining to cause more widespread problems – an issue facing many US importers is a physical inability to move containers on.
“The shortage of truck drivers and available chassis is exacerbated by a lack of flexibility in the new EDL mandate, meaning it is more difficult for standard logistics providers to implement innovative fleet-based on-road solutions,” he explains of the breadth of the current problem.
The new ELD mandate strictly controls driver hours and freight movement availability, and its phasing-in has coincided with one of the tightest freight capacity markets on record to put the industry under increasing strain. OEMs have been working with Evolution Time Critical throughout the capacity shortage, but the latest development has led to increased uptake of its time sensitive expertise.
“To compound worries about potential delays, we are nearing a traditional pre-Easter peak season for airfreight, which will hamper some initial attempts to expedite cargo effectively,” concludes Brennan. “We have already encountered an airfreight capacity crisis in recent months, during which time we worked with OEMs to deliver innovative programs that ensured completion of transatlantic shipments on time. During such times, OEMs have found that working with a dedicated emergency logistics partner enables ongoing movement of cargo and continuity of supply. Operating during especially testing or turbulent times is standard practice for emergency logistics; a network of trusted suppliers and ability to deliver an agile solution maintains component flow through the tightest of bottlenecks and safeguards vehicle production.”