Parts Shortages? BMW has Supply Chain Breakdown

Discussion in 'MINI' started by Nathan, Aug 21, 2013.

  1. Nathan

    Nathan Founder

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    Could we be seeing an issue with MINI parts availability too? Might this be some of the cause of the Power Steering Parts that dealers are waiting on?

    From Automotive News


    MUNICH (Bloomberg) -- BMW is struggling to deliver spare parts on time because of a new supply-management system, forcing customers to wait for repairs.

    About 10 percent of the parts are not immediately available in the central warehouse in Dingolfing, Germany, due to the changeover, Manfred Grunert, a spokesman for the automaker, said.

    BMW has workers on extra shifts to help shorten the wait, and aims to have the new system working properly by early September.

    The delays, which started more than two months ago with the switch to the new logistics system, have caused ripple effects globally because orders for BMW's 40 parts-distribution centers originate at the Dingolfing facility. The warehouse also directly supplies about 300 repair shops in Germany.

    "We have to disappoint about 180 customers per month; that means 20 percent of our customers with major repair work," said Burkhard Weller, owner of Osnabrueck-based Weller Gruppe, one of the two biggest BMW dealers in Germany. "The problem is present at all 16 of our locations. It is impossible to appease a customer who can't use his car."

    The issue is especially sensitive for BMW because of its premium reputation. "The ongoing problems on the spare parts supply might tarnish BMW's image," Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch Gladbach, Germany, said. "I don't remember any comparable case that a problem like that is dragging on over months."

    Profit boost

    The after-sales business is important for carmakers because it contributes substantially to their profitability, ties customers to their brand and has a high influence on customer satisfaction, according to the Nuertingen, Germany-based Institute for Automobile Industry, a state-funded think tank.

    "BMW has always been among the best companies regarding the supply of spare parts," said BMW distributor Weller, who is also a dealer for other brands, including Lexus, Toyota and Audi. "At the moment, they're bringing up the rear."

    The logistics project -- named ATLAS -- was started in Dingolfing in 2009, with a target to complete the new system within three years, according to a joint press release at the time from International Business Machines Corp. and SAP AG.

    Dropping out

    IBM, which was the main contractor and is still advertising the project on its Web site, is no longer involved in setting up the program, said Dagmar Domke, an IBM spokeswoman. She declined to say when or why IBM pulled out. SAP is supplying the software for the warehouse management system, said Marcus Winkler, a spokesman for the company.

    "The originally envisioned time frame for completion of the project had been somewhat postponed a while back as some parameters had changed," Winkler said, without providing additional details.

    BMW declined to comment on its suppliers.

    BMW delays in the United States are mostly with special order parts, said Kenn Sparks, a spokesman for the carmaker in the country. In China, some dealers are facing the same issue as well, among them China Zhengtong Auto Services Holdings Ltd. Zhengtong, which has 20 BMW dealerships in the country, is supplied by warehouses in Shanghai, Beijing and Foshan, which in turn mainly get their parts from Dingolfing, the company said. Zhengtong, in some cases, has needed to negotiate directly with component makers for special orders, the company said.

    Left waiting

    Markus Zollner, owner of the car repair shop Zollner Karosserie in Regensburg, Germany, said that one missing part can mean that the entire repair is delayed. "The worst is that when a delay happens, BMW is not able to tell us a delivery date," Zollner said. "Sometimes cars are standing there for weeks."

    BMW's distribution centers all increased their inventory before the system changeover, allowing for normal delivery of most orders, Grunert said. "A very high percentage of our dealers worldwide don't have any spare parts problem."

    Employees in Dingolfing have been working extra shifts since the beginning of June to get the spare parts to the distribution centers as quickly as possible and are already clearing the backlogs there, according to Grunert. Workers will likely be putting in extra hours until the end of the year to alleviate the delays, Erwin Gegenfurter, head of the works council in Dingolfing, said in an interview.

    For cases where parts supplies are not arriving on time, BMW is providing replacement vehicles for customers. For dealers like Weller, that's not enough. "I can't tell the customer that he will get his car back within one week; I have to say, 'I don't know,'" Weller said. "This is very unsatisfactory because, normally, we have a client satisfaction rate of 92 percent."



    Read more: http://www.autonews.com/article/20130821/ANE/308209953/#ixzz2cbqK5EjW
     
  2. beken

    beken Well-Known Member
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    AH! That explains why I've been waiting for 2 months now for parts for my car.
     
  3. DneprDave

    DneprDave Well-Known Member
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    Dingolfing, What a goofy name for a town!:lol:

    Dave
     
  4. Metalman

    Metalman Well-Known Member
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    They developed the breed for those hardy little dogs there...:D

    [ame=http://youtu.be/ghCTZF61ey0]Maybe the Dingo Ate Your Baby - YouTube[/ame]
     
  5. Motoring Magic

    Motoring Magic New Member
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    R56 Thermostats, the most sold part in all MINI dealerships, as it is used on EVERY N14 and N18 as well as all coopers with the peugot based engines, have been on backorder for weeks. I used my last one saturday and now have cars waiting. no word on when we get more-what an idiotic boondoggle
     
  6. AM_AUTOS

    AM_AUTOS New Member

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    Waited a month for OEM noise maker delete pipe to come from germany

    I am in the UK

    I guess production is ramping up for the 3rd Gen mini
     
  7. Nathan

    Nathan Founder

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    BMW has made significant changes in the software used for the parts distribution process. Reports are that it has not been going well, hence the parts shortages.
     
  8. Metalman

    Metalman Well-Known Member
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    Rumor has it that MINI is shipping extra vehicles to all the dealers.... These will be parked behind the building and will be used as parts donor cars.... If there is a run on thermostats.... Expect to see lots of MINI's parked out back...:p
     
  9. beken

    beken Well-Known Member
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    When I first saw the title of the article, I thought to myself, "I bet they're migrating to a big enterprise system like SAP and have outsourced the project thinking they're going to save some costs". Those projects rarely, if ever, come in on budget and on schedule. There's way too much scope creep and unexpected or missed requirements.

    I wished they would just ship my parts and worry about the inventory count later.
     
  10. Norm03s

    Norm03s New Member

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  11. Crashton

    Crashton Club Coordinator

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    As funny as this sounds it has happened in the past. A friend who was service manager at a Land Rover store told me after BMW bought Land Rover there were no parts for Freelander's. They kept 3 in the back lot & cannibalized them to keep the customer cars on the road. :crazy:
     
  12. nxtMINI

    nxtMINI Active Member

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    I got really lucky: My check engine light came on in my 2011 JCW a few weeks ago. Checked code: thermostat. Went to dealer, they checked the code and told me in fact it is the thermostat, but it's on a huge back order. Won't have my car for weeks most likely. Called up Detroit Tuned and they had 2 in stock! They made some arrangement with the dealer and in 24 hours I was back to driving my MINI :)
     
  13. Nathan

    Nathan Founder

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    This got more print in Automotive News today

    BMW owners vent anger at months-long wait for spare parts

    MUNICH (Bloomberg) -- South African Neels Kilian was as proud as any BMW owner could be when he got his new 3 series in May. After getting into an accident a few weeks later and still waiting today for repairs, he's reconsidering that sentiment.

    The resident of Gauteng, South Africa, needs a rear fender replaced before the car is driveable again. In the meantime, he's still making a monthly payment of 8,000 rand ($770) and has to bear additional costs for work travel because he hasn't been offered a loaner.

    "This is shocking!" Kilian wrote in an e-mail. "It is impossible to repair my vehicle; why is BMW unable to issue a warning to customers when buying this brand?"

    Kilian is among customers across the globe angered by BMW's failure to promptly deliver spare parts to fix their vehicles.

    BMW has struggled since the beginning of June to ship components on time because of a new supply-management system being introduced in its central warehouse in Germany. The delays have caused ripple effects globally because orders for BMW's 40 parts-distribution centers originate at the main facility in Dingolfing. The warehouse also directly supplies about 300 repair shops in Germany.

    Raimund Nestler, who lives in Ingolstadt, Germany, has been waiting six weeks for a new part that controls engine speed. "I have always been a die-hard BMW driver and am currently driving my seventh BMW, but will consider which brand I'll buy the next time," he said. "For a premium carmaker like BMW, this is particularly disappointing."

    About 10 percent of parts are not immediately available in Dingolfing because of the logistics changeover, Manfred Grunert, a spokesman for the automaker, said on Tuesday. BMW has workers on extra shifts to help shorten the wait, and aims to have the new system working properly by early September. "We deeply regret any inconveniences caused to our customers," Grunert said.

    Image tarnished

    The logistics troubles come as BMW is under pressure to maintain the global luxury sales crown with both Audi and Mercedes-Benz vowing to take the top spot by the end of the decade. The longer the delays drag on, the more BMW's image as a high-end automaker is tarnished.

    "The logistics problem is comprehensible, but three months is too long," said Juergen Pieper, a Bankhaus Metzler analyst in Frankfurt. "Damage has certainly occurred. I see a hit to their reputation and a financial burden of tens of millions."

    The logistics project -- named ATLAS for Advanced parTs Logistics in After Sales -- was started in Dingolfing in 2009, according to a joint press release at the time from International Business Machines Corp. and SAP AG. IBM, which was the main contractor, said last week that it's no longer involved in setting up the program. SAP is supplying the software for the warehouse management system, the German company said. BMW declined to comment on its suppliers.

    Australia woes

    Australian Eric Gibson said repairs on his BMW motorcycle have been dragging on for three months.

    "I can now ride the bike, but I'm still waiting for one more part, a driving light," Gibson said.

    Fellow Australian Lisa Stephenson, who lives in Coolamon, a farming community 480 kilometers (298 miles) northeast of Melbourne, isn't as fortunate. Her mechanic has advised her not to use her BMW, which she needs to get around in her rural area, because the part that needs replacing could cause a fire.

    "I've been waiting for five weeks for a fuel elbow," Stephenson said. "My mechanic informed me this week that the part won't arrive until sometime in October. This is extremely frustrating. Shame on BMW. I am one very unhappy customer."

    BMW is sending components via airfreight to speed up delivery times and is trying to provide replacement vehicles for waiting customers, Grunert said.

    Stephenson and Kilian both said they haven't been offered a loaner.

    "BMW is unable to inform me when to expect this part in South Africa or when my vehicle would be repaired," Kilian said. "It could be another four months or so."


    Read more: http://www.autonews.com/article/20130828/COPY01/308289961/bmw-owners-vent-anger-at-months-long-wait-for-spare-parts#ixzz2dIXnYkda
     
  14. DneprDave

    DneprDave Well-Known Member
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    -snerk- Dingolfing:biggrin5:
     
  15. Nathan

    Nathan Founder

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    BMW will fix supply-chain delays by month's end, execs say

    FRANKFURT (Bloomberg) -- BMW will resolve the supply chain problem that has delayed the delivery of spare parts around the world by the end of this month, top executives said.

    "We regret this and will resolve the problem in September for sure," CEO Norbert Reithofer said at a press briefing at the Frankfurt auto show.

    "By the end of September," the spare parts supply will function again as usual, Peter Schwarzenbauer, head of after sales and parts, said in an interview at the show.

    Thousands of customers have suffered long waits for BMW components because of a changeover to a new logistic management system in the central warehouse in Dingolfing, Germany, at the beginning of June. The delays have caused ripple effects globally because orders for BMW's 40 parts-distribution centers originate at the main facility in Dingolfing.

    Customers from Australia, South Africa, Belgium, Romania, Canada and the U.S. have cited waiting times of as long as three months for components to fix their vehicles.

    In Germany, where some dealers are supplied directly by Dingolfing, about 3,000 BMW customers had to wait an unusually long time to get their cars repaired because of missing parts, Schwarzenbauer said. In the rest of the world, a smaller proportion of customers was affected because BMW had filled up its 40 global distribution centers before the system change.

    Six-day shifts

    A couple of managers traveled from Munich to Dingolfing on a Saturday in July voluntarily to help employees fill the central warehouse, Schwarzenbauer said. Workers there have worked in three shifts six days a week since June to get parts to the distribution center and repair shops as quickly as possible, he said.

    "This was the biggest data change-over at BMW in the last 20 years," Reithofer said.

    About 10 percent of parts aren't immediately available in Dingolfing because of the logistics changeover, Schwarzenbauer said. "Parts logistics is among the most complex topics I know," he said. "Looking back, we should have completed this two to three weeks earlier."

    The logistics project -- named ATLAS for Advanced parTs Logistics in After Sales -- was started in Dingolfing in 2009, according to a joint press release at the time from International Business Machines Corp. and SAP AG.

    IBM, which was the main contractor, said last month that it's no longer involved in setting up the program. SAP is supplying the software for the warehouse management system, the German company said.

    BMW declined to comment on its suppliers.

    Read more: http://www.autonews.com/article/20130911/COPY01/309119960/bmw-will-fix-supply-chain-delays-by-months-end-execs-say#ixzz2ecZxrNmz
     
  16. Motoring Magic

    Motoring Magic New Member
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    Received our first two t stats on Fri and got 2 customers back on the road, only 4 to go......
     
  17. Systemlord

    Systemlord New Member

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    Are the thermostats still made from plastic? No that plastic components belong in a cooling system!
     
  18. Spa2k

    Spa2k Well-Known Member

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    This is definitely Not Normal

    I became a victim of this in June and again today. Mid-June, I ordered a GP2 front under tray that was "in stock" in a BMW warehouse; it arrived last Friday, almost 3 months later. After discovering this weekend that only half the necessary installation hardware was included, :mad5: I made the trip to the MINI dealer to order the parts. Most are available immediately, but two clips showed as not being available - even though the computer also showed there are 600 in the U.S! Apparently it's beyond BMW's ability to figure out how to get these parts to their warehouses across the country so they can be distributed to dealers.

    At least I'm only suffering from not being to install nonessential parts that only will enhance the enjoyment of driving my MINI. If I were waiting weeks for a thermostat or crash-repair parts, I don't know what I'd do - except remember all of this when it's time to buy a new car. :incazzato:
     
  19. beken

    beken Well-Known Member
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    Still waiting for factory tailpipes and toll hook kit ordered back in early July. When they ordered them, the dealer said two weeks.

    Also parts guy told me I was one of the shorter waits so far, he has a JCW front bumper on order for almost 4 months now.

    This is really poor. Any other company in this situation would just ship the parts and worry about their inventory counts later by doing a physical inventory.
     
  20. minirab

    minirab Well-Known Member

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    Just ordered a new set of tail lights (black center not chrome) from the

    dealer, the computer said there is one set in Germany no where else &

    the parts man said one to two weeks. Anybody want to buy a bridge?!
     

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