Shortage May Send Auto Manufacturing Into Free Fall
The supply of an important resin used in auto manufacturing processes worldwide has all but disappeared following an explosion at a critical German chemical plant.
With the chemical no longer available, there is likely to be a severe disruption in the global supply that could have far-reaching effects on the industry at large.
“The shortage has the potential to disrupt global auto production, which could have spillover effects across the entire supply chain,” said Neil Forster, an industry analyst with Scotia Capital. Yet he also cautions that it's "too early to tell what the likely impact will be."
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All major auto manufacturers have issued statements on the shortage, but so far none have reported any disruption in their supply chain. It remains to be seen what the full fallout of the crisis will be.
Speculation is nearly impossible at this point, but it's an issue supply chain managers should be keeping a close eye on in the coming months.