The True Cost Tooling Project Delays
According to a recent report, more than half of automotive tool shops have had more than half of their projects delayed. The total cost? $1.7 billion.
The cost of idle time adds up.
Late engineering changes. Designs that are difficult to manufacture, or even can’t be manufactured. Lack of purchase orders. Lack of communication. These problems and more—and the headaches that come with them—are no doubt familiar to many readers of this blog. However, what might not be as familiar is just what these issues cost not just the tool shop, but the overall industry. According to one recent report, that figure comes to about $1.7 billion.
That report is the third edition of the Automotive Tooling Barometer, a joint venture to evaluate automotive supply chain health from the Original Equipment Suppliers Association (OESA) and Harbour Results Inc. (HRI). The Barometer indicates that 66 percent of tool shops had more than half of their projects over the past four months delayed two weeks or more. On an annualized basis, almost 15 percent of business is on hold; based on the size of the tool and die industry, that translates to the aforementioned $1.7 billion, or the equivalent of 80 tool shops sitting idle at any given time.
To learn more, read the full report.
To learn more about the OESA Tooling Forum, a peer group dedicated to addressing these and other concerns of automotive vendor tool suppliers, read this profile article.
