VW production

One Supplier Isn't Nearly Enough

ARCHIV - Auszubildende arbeiten am 14.05.2013 in Anchieta (Sao Paulo, Brasilien) im Werk Volkswagen do Brasil an einem VW Golf. Foto: Soeren Stache/dpa (zu lni "Kein Verlass mehr auf die BRIC-Staaten - Autobauer suchen neue Märkte von morgen" vom 13.10.2014) +++(c) dpa - Bildfunk+++
Volkswagen could have avoided having to cut working hours by using more than one supplier.
  • Why it matters

    Why it matters

    • Carmakers usually rely on several suppliers for each part but to cut costs VW apparently failed to do so but is likely to change its strategy in the future.
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  • Facts

    Facts

    • VW’s supplier Prevent provides seat covers and gear components for VW’s Golf and Passat models but stopped doing so in protest at the terms of its agreement with the carmaker, forcing VW to interrupt production.
    • In addressing the diesel emissions scandal, VW has cut costs and expects its suppliers to help by lowering prices.
    • The just-in-time principle means that companies like Volkswagen rely on having products delivered to the assembly line precisely when they are needed, eliminating warehouses.
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  • Audio

    Audio

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Volkswagen has enough problems and the last thing Germany’s largest automaker needs is more conflict.

First the diesel scandal crippled large parts of the VW Group. Now a relatively small supplier has managed to shut down Golf production in Wolfsburg and Passat production in Emden after suspending deliveries.

Crisis has become a permanent state at the Wolfsburg-based automaker. Instead of focusing on VW’s long-term strategy and its transition to a mobility service provider and seller of electric cars, its management is forced to fight one fire after another.

But the fact that Prevent, a group of suppliers consisting of two subsidiaries, Car Trim and ES Guss, is forcing the giant Volkswagen Group to its knees by stopping the delivery of seat covers and gear components could have been avoided.

To put it another way, VW is partly to blame when a problem with a supplier has major consequences like a production shutdown.

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