Lean Supply Chains Fail to Scale Quickly

(p. A1) American factories are running short of parts.
Suppliers of everything from engines to electronic components aren’t keeping up with a boom in U.S. manufacturing, which has lifted demand in markets such as energy, mining and construction. As a result, some manufacturers are idling production lines and digesting higher costs.
. . .
(p. A4) Years spent making supply chains as lean and efficient as possible are hurting big customers now as demand climbs, industry consultants said.
“Suppliers have not been willing to jump on adding capacity because they’ve been burned badly before,” said Shiv Shivaraman, a managing director at consultant AlixPartners LLC who advises auto and machinery makers on supply chains and production processes. “You will see many people limping for a while.”
Some companies are stockpiling parts to head off future challenges, potentially exacerbating the supply pressures.
“We built some inventory last quarter because we had seen the lead times extend and we are trying protect our customers,” said Andrew Silvernail, CEO of Idex Corp. , a maker of pumps, valves and meters that is based in Lake Forest, Ill.

For the full story, see:
Doug Cameron and Austen Hufford. “Parts Makers’ Shortages Tap Brakes on Industrial Boom.” The Wall Street Journal (Saturday, Aug. 11, 2018): A1 & A4.
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 10, 2018, and has the title “Parts Shortages Crimp U.S. Factories.”)

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