VDI survey on logistics
29. May 2020
by Martin Ciupek
The lockdown of factories results in restrictions on cross-border deliveries in the international movement of goods. According to a survey by the VDI, the consequences for German companies have so far been minor.
Foto: panthermedia.net / mike_kiev
Due to the international travel and delivery restrictions, companies from German-speaking countries are increasingly concentrating on shortening supply chains and have done well with it so far. This is the result of a survey by the VDI-Fachgesellschaft Produktion und Logistik together with the management consultancy Agiplan from Mülheim an der Ruhr. Specifically, companies are focusing on additional regional or European suppliers, alternative suppliers for critical parts and in some cases have also increased the proportion of in-house production. A transparent supply chain is essential for the company – across the suppliers and their subcontractors – in some cases this was already the case before the lockdown, which has now led to fewer consequences. This supply chain should be monitored more closely in order to identify and prevent risks of supply failures in production in good time. In addition, the consolidation of the storage levels or the warehouses will be an issue for a long time to come.
Protective measures reduce productivity
The authors of the market study assume that taking the Corona safety measures into account in production also means productivity losses – possibly over a period of a year or more. The waiting times for production start-ups from suppliers in Europe or worldwide will hinder local restart processes. The authors consider the solution to be the optimization of the production mix between different locations, the increase in the degree of automation in production and a further reduction in throughput times in connection with a possible increase in stocks of preliminary products.
A quick survey in German mechanical engineering by the industry association VDMA comes to similar results. According to this, almost all companies (98%) are affected by the economic effects of the corona pandemic, but there are fewer and fewer supply-side disruptions. For 81% of those surveyed, the supply chains are now intact. At the beginning of May, however, the value was 61%.
Global production networks have an advantage
Companies with global production networks were more flexible than others. For example, the automation technology specialist Pilz from Ostfildern relocated parts of its production there to Germany during the closure of Chinese plants. Later, when production in China started up again, production shares were relocated from Europe to China, explained Managing Director Thomas Pilz this week. Companies with a presence in China have also benefited from the experience with the protection concepts. For example, Volkswagen used this when ramping up production plants in Germany and Europe.
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