Production Stops Suppliers send employees on short-time work

From Alexander Stark

Production stops at car manufacturers are causing difficulties for German suppliers. According to a survey, 70 percent of respondents have to put their employees on short-time work because of this.

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According to a survey, many automotive suppliers are currently dissatisfied with their customers.
According to a survey, many automotive suppliers are currently dissatisfied with their customers.
(Source: Volkswagen)

The Corona year 2021 was not an easy one for the industry: chip shortages, rising resource and energy costs and now incidence rates in Germany are rising rapidly again. But production stops at car manufacturers have far-reaching consequences, as a survey conducted by the German sheet metal industry association “Industrieverband Blechumformung (IBU)” has revealed. The association represents around 240 companies nationwide.

“Suppliers are left high and dry”

According to the survey, 90 percent of the respondents are already affected by fluctuating call-off figures. 70 percent of the suppliers surveyed have to put their employees on short-time work because of this. “OEMs cancel orders at short notice and the suppliers are left high and dry,” says Bernhard Jacobs, managing director of the industry association. Accordingly, most of the suppliers surveyed give their customers a grade of five in the “reliability” category. More than 23 percent even rate them as “inadequate”.

Around 70 percent of the participants complain that manufacturers are not willing to contribute to the additional costs caused by production stops. The consequences are short-time work and wage losses for employees of supplier companies, according to the association.

Fifty percent of the participants in the survey are Tier 2 suppliers. Just under 20 percent are Tier 1 suppliers, and a similar number belong to the Tier 3 category.

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