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You’re exactly right. Somebody at a major chip company told me that they went looking for, and found, new customers after the automotive customers canceled the
by TomVDB 5y ago
You’re exactly right.
Somebody at a major chip company told me that they went looking for, and found, new customers after the automotive customers canceled their orders.
So not only did the car companies ordered more than before after they realized that demand was not dropping, even if demand for them had returned to what it used to be, the total demand from other customers is now higher too.
- sroussey 5y agoBlame this on just-in-time supply chains where no one wants to hold inventory. It’s been MBA dogma for the last two decades.
- notananthem 5y agoNeither JIT nor many other things factors in "global pandemic," but proper JIT that knows how to scale up/down theoretically could handle things, its just the human element that fucks up the system. Yeah beancounters are beancounters but trying to blame JIT is really off course.
- kmonsen 5y agoIsn't the problem that is is not easy to scale some things up and down? This sounds a lot like no true scotsman.
- Dylan16807 5y ago> This sounds a lot like no true scotsman. The claim is more that they are bad planners, orthogonal from whether they use JIT or not. They're not doing proper supply management. You can do proper supply management with JIT or without JIT. You can also do improper supply management with JIT or without JIT. For it to be "no true scotsman" they would have to be claiming that "doing JIT" is a solution to supply management. And they're not claiming that.
- kmonsen 5y agoI guess you are partly right, but parent said "proper JIT" would work well without any evidence to what that means. Surely not everyone is doing the "improper" JIT.
- sroussey 5y agoI disagree, respectfully. Not that I think everyone should inventory a year of everything. But the ethos of JIT is that you can treat your supply chain as if it’s infinite, and this keep it close to your projections. Automotive got hit especially hard since any feature that requires electrics has the microprocessor embedded in that feature. Very cost effective-you don’t ship extra cpu power for unused features. Tesla did the opposite though—centralized processing and over allotted cpu cycles by also made it easy to upgrade via software only.
- ummonk 5y agoSeems like we are dealing with the opposite issue here where factory production is booked many months in advance and can’t quickly adapt to new demand.
- BBC-vs-neolibs 5y agoThe factory is not in trouble, their customers are.
- depereo 5y agoTAM for semiconductors turned out to be wayyyyyy bigger than the world's manufacturing capacity for semiconductors. I don't know how this caught manufacturers by surprise, but perhaps there's bottlenecks in talent, supporting industry and infrastructure that I'm not aware of that would have made additional expansion difficult previously.
- colechristensen 5y agoThere’s just not flexibility built in to the supply chain because flexibility adds cost. When things go well this just in time manufacturing is lauded as a huge money saver, when they aren’t… you get now. The business of running everything to the wire on credit and working “cost of capital” so much into business decisions gets us here.