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3,491 Posts
Before you start lobbing the rotten produce, hear me out...
With the backlog and pent-up demand the way they are, GM will make money as long as the line keeps building SKYs - regardless of the particular orders fulfilled. If we are getting no Red Lines this week, and no cars with painted rims, that just means that base SKYs with Chrome and Polished rims move to the front of the line. This could mean that later on there will be a week when the plant only builds Red Lines to catch up (they did that in the past one week, didn't they?) Also, you can expect some time when the percentage of painted wheels goes up and the percentage of chrome and polished wheels goes down. In fact, I remember when I was waiting on my SKY that there was a constraint on chrome rims, so I skated on through with my painted selection. This week with no painted rims just serves to balance that out...
When you manage a supply chain, you want to make sure that you have enough parts to meet the overall demand over time. There are too many options and too many unpredictable events that prevent you from being able to sustain every option at every point in time. The costs to do this would add significantly to the price of the car. Instead, it's more cost-effective to allow short-term shortages as long as the long-term targets are met.
How would you like to get this message: "We had the truck carrying your chrome rims plunge into a river when the driver swerved to avoid a baby on the roadway, so it looked like we weren't going to be able to build your car until next week instead of this week as we had originally planned. But, good news! We got the rim supplier to run an extra shift, and we air-freighted the rims to our plant, and so we built your car on time - and we are only charging you $982 to cover the overtime and the rush freight charges!"
I, for one, would respond "No... Please! I can wait a week or two. No need to rack up crazy expenses just to meet the original target date."
Before you argue that this is an extreme case, I just wanted to illustrate a simple example with a single component. The SKY, of course, has tens of thousands. You want to keep just enough of a supply to guarantee that the line never shuts down. If you want to keep an extra supply of every component on hand, then that would raise your material costs - and this increased cost would be passed on to you (er, US), the consumer.
And when it comes to problems - like the turbo issues - we all get to pay for that, too. If there is a recall or some rework required to fix the cars already delivered, then the costs of doing this will be added onto the price that the rest of us pay. It's better to have the plant solve the problems before producing any more cars, so they don't have to pass along those extra costs to us as well.
In the software industry, we have a saying: "Good, fast or cheap - pick any two." We want good cars, and we want to keep them affordable. Sometimes that means we have to wait a little longer. From the howling that I see over pricing, we should all be okay with that.
So, for those of you waiting for non-turbo SKYs with upgraded rims, this may be your lucky day! For me, I'll just keep on waiting knowing that my day will come. It will come... And, when it does, I am confident that my car will be right and I will still be able to afford it.
That's how I feel about it, anway. And now, I am going to exit stage left as I sense a rotten tomato about to be lobbed my way...
:leaving:
With the backlog and pent-up demand the way they are, GM will make money as long as the line keeps building SKYs - regardless of the particular orders fulfilled. If we are getting no Red Lines this week, and no cars with painted rims, that just means that base SKYs with Chrome and Polished rims move to the front of the line. This could mean that later on there will be a week when the plant only builds Red Lines to catch up (they did that in the past one week, didn't they?) Also, you can expect some time when the percentage of painted wheels goes up and the percentage of chrome and polished wheels goes down. In fact, I remember when I was waiting on my SKY that there was a constraint on chrome rims, so I skated on through with my painted selection. This week with no painted rims just serves to balance that out...
When you manage a supply chain, you want to make sure that you have enough parts to meet the overall demand over time. There are too many options and too many unpredictable events that prevent you from being able to sustain every option at every point in time. The costs to do this would add significantly to the price of the car. Instead, it's more cost-effective to allow short-term shortages as long as the long-term targets are met.
How would you like to get this message: "We had the truck carrying your chrome rims plunge into a river when the driver swerved to avoid a baby on the roadway, so it looked like we weren't going to be able to build your car until next week instead of this week as we had originally planned. But, good news! We got the rim supplier to run an extra shift, and we air-freighted the rims to our plant, and so we built your car on time - and we are only charging you $982 to cover the overtime and the rush freight charges!"
I, for one, would respond "No... Please! I can wait a week or two. No need to rack up crazy expenses just to meet the original target date."
Before you argue that this is an extreme case, I just wanted to illustrate a simple example with a single component. The SKY, of course, has tens of thousands. You want to keep just enough of a supply to guarantee that the line never shuts down. If you want to keep an extra supply of every component on hand, then that would raise your material costs - and this increased cost would be passed on to you (er, US), the consumer.
And when it comes to problems - like the turbo issues - we all get to pay for that, too. If there is a recall or some rework required to fix the cars already delivered, then the costs of doing this will be added onto the price that the rest of us pay. It's better to have the plant solve the problems before producing any more cars, so they don't have to pass along those extra costs to us as well.
In the software industry, we have a saying: "Good, fast or cheap - pick any two." We want good cars, and we want to keep them affordable. Sometimes that means we have to wait a little longer. From the howling that I see over pricing, we should all be okay with that.
So, for those of you waiting for non-turbo SKYs with upgraded rims, this may be your lucky day! For me, I'll just keep on waiting knowing that my day will come. It will come... And, when it does, I am confident that my car will be right and I will still be able to afford it.
That's how I feel about it, anway. And now, I am going to exit stage left as I sense a rotten tomato about to be lobbed my way...
:leaving:
