Suppliers may block sales momentum, says Bmw’s Martin Schueble

Article by Christian A., on December 22, 2010

BMW AG's North American vice president of procurement, Martin Schueble, said some of his suppliers cut too deeply during the recession and, now that the industry is recovering, those suppliers cannot meet demands.

He adds that access to financing is also a problem. However, he did say that only “very, very few companies” are actually struggling.

He believes the problem is more severe in the U.S. than in Europe. Many in the industry are concerned that this problem will worsen as consumer demand is expected to rise further in 2011.

U.S. sales forecasts for 2011 are around 12.7 million vehicles, up from an estimated 11.7 million finish this year. Some analysts predict sales of more than 13 million. However, if suppliers struggle to rebuild capacity, then that could impede the sales recovery and that problem could play out in showrooms if carmakers cannot meet consumer demand.

Chairman of Nissan Americas Carlos Tavares encountered that problem in 2010. Because of strong sales of SUVs and pickups, Nissan increased production of body-on-frame vehicles in Canton, Miss., and Smyrna, Tenn.

A European supplier of generic semiconductors simply ran out of capacity and then the supply line stopped. [via autonews - sub. required]

Topics: bmw, sales

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