COVID-19 Pandemic Could Lead to Lasting Manufacturing Changes, Panelists Say
Companies that import components or finished goods are reevaluating their supply chains in the wake of the novel coronavirus pandemic, said Andrea Little Limbago, vice president of research and analysis for Interos, a supply risk management company. Little Limbago, who spoke at an Atlantic Council webinar Sept. 23 on how technology can improve global supply chains, said that Interos surveyed 450 executives across many industries, and 98% had disruption during the COVID-19 surge this year. She said that while logistics were a major part of the disruption -- and those are starting to get worked out -- 25% of the executives said they work with vendors who went bankrupt. “We're just on the tip of that,” she said.
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She said the survey found that more than one-third of executives plan to start moving way from just-in-time production. She also said that many companies that want to bring some production to the U.S. will rely on automation to make those operations cost effective. She said that in some fields, such as aerospace manufacturing, more than 85% of executives say they want to return more work to the U.S. She said that both the risk calculations and the cost calculations that drove offshoring are being overturned.
But importing will still be a major part of how supply chains work, and companies are looking to remedy vulnerabilities by learning more about their whole supply chains, not just tier 1 suppliers. She said many companies thought they didn't have any connection to a region that was undergoing a pandemic lockdown, but it turned out, they did.
Matthew Putman, CEO of Nanotronics, said his company decided to start making a non-invasive breathing device for COVID-19 patients, and they were able to design a product in just a couple of months by 3D-printing parts, trying them out, and trying again if the design didn't work. He said the device received emergency use approval within 90 days. “We couldn’t have done it with a larger supply chain,” he said.