Bloomberg News

BMW to Fix Supply-Chain Delays by Month’s End, Executives Say

September 10, 2013

Bayerische Motoren Werke AG CEO Norbert Reithofer

Bayerische Motoren Werke AG Chief Executive Officer Norbert Reithofer. Photographer: Krisztian Bocsi/Bloomberg

Bayerische Motoren Werke AG (BMW), the world’s biggest maker of luxury cars, will resolve the supply chain debacle that 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,” Chief Executive Officer Norbert Reithofer said at a press briefing at the International Auto Show in Frankfurt. “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 Munich-based 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 e-mailed Bloomberg News citing 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 100 kilometers (62 miles) northeast 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. (IBM:US) and SAP AG. (SAP)

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 Walldorf, Germany-based company said. BMW declined to comment on its suppliers.

To contact the reporter on this story: Angela Maier in Frankfurt at amaier8@bloomberg.net

To contact the editor responsible for this story: Chad Thomas at cthomas16@bloomberg.net


Race, Class, and the Future of Ferguson
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • IBM
    (International Business Machines Corp)
    • $190.41 USD
    • -0.82
    • -0.43%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus