BERLIN (Reuters) -Volkswagen is entering into direct purchase agreements in unprecedented areas to tackle the worst supply chain shortages the company has seen, its purchasing chief Murat Askel said at a conference in Berlin on Tuesday.
The carmaker was also building a database to help predict geopolitical, natural and supply chain risks ahead of time, as it did for financial risks after the 2008 financial crisis, Aksel added.
“We never used to talk to mining operators – now we know their business model,” Aksel said. “It is no longer enough to rely on Tier 1 suppliers – we need to look behind the curtains ourselves.”
Volkswagen was experiencing a shift in power from a buyer’s market to one where the carmaker was increasingly a smaller and less powerful customer for suppliers in newly important areas like software, Aksel said in his speech at the Automobilwoche Kongress conference.
Other companies would order a million chips a week or day where the carmaker was looking for a million a year, he said, dampening its negotiation power.
“For the software providers, we’re the small player, not the big one,” he said.
(Reporting by Victoria Waldersee, Editing by Miranda Murray)
