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Break Down in BMW Supply Chain Leaves Customers and Dealers in a Lurch

Image via Flickr by HighTechDad

The new logistics system BMW has implemented moves parts from their Dingolfing manufacturing and warehouse facility to 40 distribution warehouses and about 300 automotive repair shops around Germany. The system has broken down, causing a ripple effect and leading to about 180 BMW owners per month who are unable to get the parts they need to repair and drive their vehicles. According to dealerships affected by the supply chain break down, this is hurting their stellar record of customer satisfaction.

BMW parts makers are working extended shifts to try to resolve the parts shortages. The company hopes to have the backlog of orders caught up by the end of September. About 20 percent of BMW’s customers are in need of major repair work, and the lack of a single part can delay service. Though the company is providing these customers with replacement vehicles while waiting for repairs, this is not satisfactory to many of the customers, especially since the company can’t give them a date for when the part should become available.

After market parts sales are an important part of customer service, according to the Institute for Automobile Industry in Nuertingen, Germany. These sales boost the company’s profits, but also build a stronger loyalty in the customer for the brand name. Parts delays are also hindering BMW’s “silent recall,” a process which replaces faulty parts during regular maintenance before the customers even know there’s a problem with the part.

For U.S. customers of BMW, most of the parts delays involve specially ordered parts, not parts required for major repairs. BMW also maintains that a large percentage of their dealerships around the world are not experiencing any parts delays at all. BMW dealerships in China have also had problems getting the parts they need to serve customers. BMW owners normally reward the company with very high satisfaction ratings.

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