Bosch, the world’s largest automotive parts supplier, is calling for changes in how the supply chain operates as a result of the semiconductor crisis.
The COVID-19 pandemic sparked a chain of events that have led to a massive semiconductor shortage. It began with factories shutting down as a result of lockdowns and continued due to pandemic-fueled increases in demand for computers, tablets and gaming consoles. The impact has spread beyond the computer industry and is wreaking havoc on the automotive industry as well. Many automakers have had to close plants, reduce production, delay models or ship vehicles without their usual complement of electronics.
Bosch’s management believes the inherent nature of the supply chain is a large part of the problem, according to CNBC.
“As a team, we need to sit together and ask, for the future operating system is there a better way to have longer lead times,” said Harald Kroeger, a member of Bosch’s management board. “I think what we need is more stock on some parts [of the supply chain] because some of those semiconductors need six months to be produced. You cannot run on a system [where] every two weeks you get an order. That doesn’t work.”
Kroegen also emphasized the fact that cars are becoming even more dependent on semiconductors than in the past, making these issues more likely to occur in the future.
A company as large and important to the industry as Bosch calling for improvements is sure to get attention, and may very well lead to the kind of changes the industry needs.