Managing Risk in the Automotive Supply Chain

With automotive just-in-time production, every minute counts when you have supply disruption. Learn how Toyota Boshoku America was able to react faster to events and secure supply using The riskmethods SolutionTM.

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How can you steer clear of supply chain risk? Let us take the wheel.

Some 75% of all car parts are sourced from third parties. How do you make sure you get the right quality and quantity just in time, and compliant to lean manufacturing processes? In the auto industry, shortfall is a no-go.

Three Reasons Why Your Automotive Supply Chain Is at Risk

How Automotive Original Equipment Manufacturers (OEMs) and Suppliers Master Supply Chain Risk

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“The riskmethods Solution saved us hundreds of hours. We demonstrated to a key customer how quickly we can identify high-risk suppliers, and how this information helps us mitigate potential disruptions. This boosted our reputation and cemented our relationship with the customer.”

Allen Holcomb, Director, Global Electronics Supply Chain, Nexteer Automotive

Why Manage Risk with The riskmethods Solution?

be-riskaware

Be risk aware

Get sub-tier visibility. Uncover risks in your complex global supply chains to make better business decisions.

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React faster

Gain competitive advantage. Manage the challenges that come with just-in-time inventories.

be-proactive

Be proactive

Protect your business. Anticipate threats from geopolitical tension, disruption, or regulatory change.

Use a Total View of Risk to Overcome Your Supply Chain Challenges

Risk #1: Geopolitical Risk

Trade barriers, political conflicts, and currency fluctuations can lead to disruption

Challenges: Tariffs, China’s market influence, Brexit, growing protectionism. Automotive supply chain performance is highly vulnerable to geopolitical risk.

Consequences include:

  • Material shortfalls (such as semiconductor shortages)
  • Rising prices for commodities (for example, PA66)
  • Delays and higher costs for customs handling, quality control, monitoring geopolitical situations


With The riskmethods Solution, you stay up to date on geopolitical risk. Supply chain managers and procurement experts can respond quickly and take preventative measures:

  • Stay informed of country-related tariff changes
  • Get early warnings about emerging material or product shortages
  • Quickly visualize the affected suppliers and other risk objects on a world map
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Risk #2: Lack of Sub-Tier Transparency

Eight in ten automotive manufacturers list visibility as their top hurdle

Challenges: Automotive OEMs and suppliers realize that transparency of their supply base, vendors, and third parties is critical. According to the Business Continuity Institute, more than half of supply chain disruptions occur below tier 1.

With The riskmethods Solution, you can:

  • Get visibility into your sub-tier suppliers (also called tier 2 suppliers), third parties, and all transportation routes on a world map
  • Monitor your end-to-end supply chain from n-tier suppliers to end customers in real-time
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Risk #3: Evolving Technology, Standards, and Requirements

Regulations and revisions accompany technology shifts. Exposure to a resurgence of audits.

Challenges: Automotive suppliers must adhere to strict industry standards, as well as to requirements set by OEMs and key suppliers. Additional challenges facing supply chain managers and procurement experts include rapidly changing technologies, resulting in many new or updated regulations.

With The riskmethods Solution, you can:

  • Install proactive measures to ensure you meet customer demands, including on-time delivery and quality requirements
  • Ensure that suppliers, vendors, and third parties are compliant with regulations, such as cybersecurity and environmental directives, and that you avoid conflict minerals 
  • For continuous improvement, directly collaborate with your business partners proactively to avert negative impact

Customers all over the world rely on The riskmethods Solution

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“Thanks to The riskmethods Solution we instantly saw which of our suppliers were impacted when the coronavirus hit northern Italy. This allowed us to switch to alternative sources before our competition to ensure business continuity.”
Josip T. Tomasevic, Senior Vice President & Chief Procurement Officer, Global Purchasing and Materials Management, AGCO Corporation

Have a question about managing risk in the automotive supply chain?

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