Supply Chain Managers Face Resource Shortages

The world’s growing population, an increase in GDP levels and changing lifestyles are causing consumption levels of renewable and nonrenewable natural resources to rise globally. The result is increasing scarcity of raw materials, causing many manufacturers to walk the line separating “just in time” from “just not there,” according to a new report from PricewaterhouseCoopers.

“Metals Scarcity in Manufacturing: The Ticking Timebomb” analyzes the impact minerals and metals scarcity is likely to have on seven different manufacturing industries: infrastructure, high-tech, automotive, renewable energy, chemical, energy & utilities and aviation. PwC interviewed senior executives in these industries, and for the majority, efficiency and collaboration throughout the supply chain are seen as essential to responding to the risk of shortages.

Most respondents saw resource efficiency as the most effective response to address resource scarcity (75%). However, strategic alliances with suppliers (68%), supplier diversification (67%), more R&D (65%), more re-use (64%) and more geodiplomacy (61%) also rate highly. More extraction (55%) and relocating production (42%) scored less strongly.

In Europe, end-users play a greater role in dealing with scarcity because of the greater possibility of re-using minerals and metals (92%). Re-use was a less viable solution among respondents in the Americas and Asia Pacific. They are more focused on resource efficiency.

By industry, companies in the renewable energy sector unanimously highlighted the importance of resource efficiency, followed by the automotive sector with a response rate of 82%. Responses peaked at 82% in the case of geopolitics as a measure for the infrastructure sector, whereas only 17% of the aviation sector is convinced about this option. The high-tech industry perceives more substitution as the most suitable measure (89%), followed by the automotive segment.

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