The Evolution of the Multi-tier Supply Chains in the EU Automotive Industry Driven by Covid-19 - A case study at a large automotive OEM
Examensarbete för masterexamen
Supply chain management (MPSCM), MSc
Covid-19 has impacted global supply chains in an unprecedented way. It is fair to say that the automotive industry took the hardest hit when the pandemic first striked due to sensitive supply chain (SC) characteristics. During the crisis, the importance of a seamless, connected, agile and transparent multi-tier SCs is recognized by stakeholders and major original equipment manufacturers (OEMs) are called for taking more responsibilities to govern their multi-tier SCs through the development of supply chain risk management (SCRM). Being initiated and driven by the focal company, an OEM, this thesis describes the impacts of Covid-19 on the EU automotive industry in detail. It also provides recommendations on how the focal company can better manage its SCRM efforts and increase SC transparency as one of the core SCRM strategies in order to enhance SC resilience and prevent future disruptions. The focal company’s multi-tier SC is studied in this report which included the focal company, two of its tier-1 suppliers and two of its tier-2 suppliers. The impacts of Covid-19 experienced by the studied companies are categorized as direct and indirect effects of which the companies’ corresponding counter measurements are analyzed. Further, the SCRM strategies used by the studied companies during Covid-19 are analyzed using presented theoretical frameworks. The findings suggest that the focal company needs to increase SC transparency by addressing several key barriers mentioned by the interviewed suppliers, specifically information utilization, business process and power structure; and increase the level of information sharing with the identified key suppliers based on the characteristics of the business relationships. The analysis and recommendations of this thesis are made based on empirical data collected through conducting semi-structured interviews with companies’ representatives and a thorough literature review on the subject of Covid-19, SCRM approaches and SC transparency. The collected data are then analyzed based on several comprehensive frameworks in the related subjects established by antecedents. This thesis contributes to the sponsor OEM and industrial research in applying existing framework to map the various SCRM methods implemented by different tier suppliers, understanding the barriers needed to be addressed to allow efficient information sharing in an EU automotive supply chain and providing suggestions on how to increase transparency based on the OEM’s current SC settings.
Covid-19, Supply chain Risk Management, Supply Chain Transparency, Information sharing, Automotive Industry, Multi-tiers, Supply Chain Resilience