TOKYO— Toyota Motor Corp. is stockpiling up to four months of some parts. Volkswagen AG is building six factories so it can get its own batteries. And, in shades of Henry Ford, Tesla Inc. is trying to lock up access to raw materials.
The hyperefficient auto supply chain symbolized by the words “just in time” is undergoing its biggest transformation in more than half a century, accelerated by the troubles car makers have suffered during the pandemic. After sudden swings in demand, freak weather and a series of accidents, they are reassessing their basic assumption that they could always get the parts they needed when they needed them.
“The just-in-time model is designed for supply chain efficiencies and economies of scale,” said Ashwani Gupta, Nissan Motor Co.’s chief operating officer. “The repercussions of an unprecedented crisis like Covid highlight the fragility of our supply-chain model.”
Consider Ford Motor Co. and its F-150 pickup, the bestselling vehicle in the U.S. The latest version is crammed with technology including a hybrid gas-electric drive and automatic Tesla-style software updates.
With vaccinations beginning to beat back Covid-19, customers bought around 200,000 F-150s in the first quarter of this year, its best retail start in 13 years. Yet now supply is short. Truck factories were shut down or had limited production for all of April and the slowdown will likely continue through at least mid-May. The hit to pretax profit is as much as $2.5 billion.
