Supply Chain Issues Update for Metalfab Fire Trucks
- January 7, 2022
- Posted by Ryan Stacey
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Supply Chain Issues Update for Metalfab Fire Trucks
With 2022 comes a new year and many signs that supply chain issues will be rectified in time. However, even with some resolution in sight, it will unfortunately take some time to get everything back to normal. We currently have a backlog of demand for components like chassis, electrical parts, fire ladders, and various other items that will take time to address. In the meantime, we continue to see price increases for these parts that reflect continued supply restrictions.
Amid closures, travel restrictions, employee and product shortages, and dissension about how to beat COVID, there have also been less dollars available to fund important fire department initiatives like manufacturing safety equipment and apparatus. We understand this may be impacting our fire chiefs. Many of our suppliers are suffering from these same issues.
Since COVID has decimated the workforce, simply hiring more people to keep up with demand isn’t an option for most suppliers. The people are just not there. However, even with a stable workforce, suppliers would likely feel the effects of their own supply chain issues at full capacity.
In spite of these challenges, demand for fire apparatus soared in 2021. After dropping 8% in 2020, orders rose 60% in the second quarter of 2021 for the United States and 88% for Canada, while the export market remained down at 74%. Through the frustration, it’s important to maintain an understanding of the situation. Some key supply chain issues to continue to watch in 2022 are LED lighting, which has recently become restricted, and semiconductor production, where we may see delays extend into 2023.
As you likely already know, semiconductor shortages have led to major production cuts and fierce competition in the auto industry, which lost $210 billion in revenue in 2021. In the early months of the pandemic, semiconductor factories slashed production in anticipation of a long-term reduction in demand. When demand surged again, these factories struggled to respond as a result.
Semiconductor chips take a lot of water to produce, and natural events have made recovery an ongoing challenge. Severe summer drought in key manufacturing locales like Taiwan place heavy restrictions on production. Winter storms like the one that affected Texas Instruments freeze factories and damage semiconductors headed to market. The chip market has also had to contend with a fire that damaged a chip factory in Japan. All of these natural events combined have had an enormous impact on the market.
The Biden Administration has allocated $52 billion through the Build Back Better campaign to boost chip production in the United States. Similarly, the European Union has pledged the equivalent of $160 billion for chip production. While the worst is over and the supply of chips has already started to recover, the effects are still expected to be felt throughout 2022 at least. Other shortages like tires, interior plastics, and seat foams are also impacting the industry’s ability to deliver in a timely manner.
The United States is also using its Build Back Better campaign to encourage businesses and consumers to consider electric alternatives. With aggressive fuel economy standards, President Biden hopes to see electric vehicles account for 50% of auto sales by 2030. If more people pick up on electric vehicles, it will free up more resources for emergency response vehicles to be produced. It also presents an opportunity to explore electric vehicle options for your fleet, which may cut production costs and accelerate delivery.
Finally, LED lighting, which is essential for manufacturing our trucks, is experiencing an unrelated influx in demand recently because early adopters are seeing their LEDs reach the end of their lifespan and need to upgrade. While this is not related to the pandemic, it has created a backlog for these products, driven prices up, and pushed production out an additional month or so as a result.
Keep Up to Date with Metalfab
Your team at Metalfab continues to monitor the supply chain situation very closely and will act quickly to reflect any improvements. When prices begin to decrease and parts become more readily available again, our valued fire chiefs and customers will be the first to benefit. That’s a Metalfab promise you can trust.
In the meantime, while we are still experiencing these difficulties, we do recommend ordering sooner in the purchase cycle to ensure a timely delivery for your new fire truck. We are adapting our production schedule daily to account for supply chain challenges and investing in innovative products to better support first responders.
If you have any questions about the Metalfab supply chain or if you are interested in manufacturing a new custom fire truck at this time, please give us a call at 1-800-561-0012 or reach out to Business Development Manager Ryan Stacey directly by email at firstname.lastname@example.org. We look forward to working with you.