Ada Tiveman Ufacturian
Great topic! Challenges posed by the increasing winds of isolation do not bode well for North American industry. I agree with Jason as well that CapEx investments at this point do not make much sense. Undoing NAFTA will not happen overnight and GM should buy as much time as possible before taking significant action to change the supply chain.
That being said, planning to do nothing is not ideal either. GM should fully understand the cost, schedule, and quality implications of having to in-source sub-components or whole vehicle manufacturing. Much like Jide’s article about Toyota in the UK with Brexit, I find it hard to see a situation where the North American consumer benefits from this scenario.
Great topic! Food security is a not often discussed but critically important topic. In particular with regards to the looming consequences of global warming, ensuring that our communities have safe, secure access to food sources that don’t further degrade our environment is very important. Plenty’s approach of providing premium ingredients that can be charged a premium is an interesting strategy. Much like early Tesla, where they developed their core technology using a luxury low production run roadster, plenty is doing all the early heavy lifting using a high end client. This will in turn allow them to “grow” and scale quickly, enabling them to serve more markets effectively.
I would be concerned about vertical farmings ability to compete with low cost industrialized agriculture. Particularly since the current food supply chain is optimized to service large mono-culture farms. This goes to the earlier point of the importance of getting a foothold serving the premium market. My other concern is whether or not vertical farming can be developed to grow larger quantity staple crops in an economic way.
Interesting article and take on a less discussed part of the automotive supply chain. As you mentioned, its very important for Adient to be able to differentiate itself in order to maintain some of the riskier contracts. Generally speaking, since its so easy for OEMs to switch over, keeping track of KPIs that you are measured against is very important. I think that digital technology like block-chain can help facilitate the tracking of these KPIs such as on time delivery and in-process quality. Ensuring that you keep on top of these key metrics in real time and demonstrate to you customer that you can do so at the best cost can be a great way to propagate a customer relationship.
To adjust for the macroeconomic environment, I think it would be interesting to prioritize certain types of strategic customers, such as high end European manufacturers to lock in more complex products.
Fascinating! I suffered during the great Chipotle Closure of 2016, not having access to my favorite fast casual restaurant was painful. Seeing Chipotle let its customers down was disappointing.
On a serious note, I had never guessed blockchain could be implemented within the context of a supply chain to track and verify goods, but the implications are now clear. Permanent, immutable, and instantaneously retrievable knowledge of exactly when and where an item has been has tremendous implications. Better quality control, lower overhead costs, and better management of recalls.
I also see applications in other food sectors, such as seafood origin and authenticity tracking. “Fake” and illegal seafood is a huge problem in the food industry and at this point in time almost impossible to fix. Aside from DNA testing, there is not real way to verify whether your Costco 5 lb family pack of frozen cod is actually cod. World fish stocks are severely threatened from unauthorized fishing fleets that catch fish outside of fishing season, severely hurting their ability to reproduce. Requiring legal fishing fleets to use blockchain to track their catch could make it much easier for reputable companies (like Costco) to only source seafood with a verifiable chain.
A very compelling piece, indeed! I was surprised to learn how significant the automotive sector is for the UK (10% of GDP is very large). My biggest concern however with these turn of events, is that the populists who propagated the thought of Brexit being good for the country might get exactly what they wanted, i.e. a return of certain types of manufacturing back to the UK. While this is undoubtedly good for the average UK auto worker, it generates the impression within the general public that these types of policies will deliver on their promise and be good for the country in the long term.
On the other side of the coin is the issue of talent and migration to/from the EU. Any product that is heavily engineered and relies somewhat on progressive R&D to improve and compete will require a fresh stream of technical talent which I understand the UK is not able to provide on its own . I could see a situation where Toyota might have to outsource some level of R&D to the EU if it cannot fill its engineering vacancies. Additionally, the automobiles produced in the UK for the EU market (~75% according to your essay), need to be designed with the EU consumer in mind. If it becomes more difficult for Toyota (or any other auto manufacturer) to import design talent they will most likely have to send that work to the continent. Both of these cases see high paying jobs leave the UK.
On your question about supply chain consolidation, I fear this is much easier said than done. Automotive supply chains are complex for a reason. Forcing Toyota to source new parts from local suppliers could: increase costs, require engineering level re-designs, complicate the spare parts business and obsolescence planning, reduce quality, and place additional risk on manufacturing. I think the cumulative effect of these risks will be to increase the cost of Toyota vehicles to the consumer and potentially reduce quality. It will be a huge challenge for them to transition their supply base.
At the end of the day though, Toyota has a massive amount of investment tied up in the UK, and as you said will not pick up and leave for the Rhineland. Besides, where else can you enjoy mediocre football and warm beer at your local pub?
Yohann, as a fellow caffeinated connoisseur, I was very troubled to read your essay on global warming’s impact on the coffee supply chain. While I was aware that global warming would have an impact generally on arable land, I was not aware of the magnitude of the problem for coffee. I was also pleasantly surprised to learn about the efforts that Nespresso is going through to shore up its own supply chain and reduce its environmental footprint. That being said, I am skeptical that their efforts or the recommendations you mentioned would do enough to shore up future coffee supply. While honorable, providing financial stability to low income coffee growers does nothing help them utilize their land when it is no longer suitable for coffee. Additionally, Nespresso reducing its own emissions on its own will not change the course of environmental change.
I believe, as you said, that the worlds coffee producers must all take action in concert to deal with this issue. One thing that should be on the table is funding research on how to genetically modify coffee plants to exists in warmer/dryer climates. I would also love to see more public/private partnerships addressing this issue. Coffee is important not only to the individual consumers and growers, but also to society as a whole.
Another issue which was not brought up was the impact of Coffee Rust, a fungus that kills coffee plants which spreads in warmer weather. Coffee rust has decimated plantations in the Dominican Republic, to the point where the country is now a net coffee importer instead of exporter. This disease, coupled with the reduction is usable farmland would likely make things even worse for us coffee lovers.