# The Death of Just-In-Time Manufacturing? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [May 18, 2021, 8:26pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392 "2021-05-18T20:26:46Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 8:26pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/1 "2021-05-18T20:26:46Z")
This _might_ not be appropriate for GQ since I’m not sure there’s a factual answer, but I figured I’d start here and see what happens. The pandemic has exposed serious, gaping holes in the supply chain, which have been exasperated by things like globalization and specialization. Across many industries there are dire shortages of critical components and raw materials. Some of the prominent ones are in computer chips, mostly from Taiwan, which is killing game systems, smart devices and car manufacturing. Lumber which is spiking prices for home construction/remodeling. Various shelf-stable foodstuffs, which at least in the US were never seasonal, have been difficult to find (anecdotally, Clausen Pickles have been unavailable for months here). Some of these items could be considered critical strategic resources. Certainly they are crucial for constant economic development. How much of this scarcity is exacerbated by Just-In-Time Manufacturing/Supply Chain principles? Should companies move towards keeping more inventory on hand to better absorb disruptions to the supply chain? How should things change to prevent a recurrence? Should anything change or do we just cross our fingers and pray that we don’t have another global pandemic or other massive disruption? ---
**Author:** ![What\_Exit](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/what_exit/32/10652_2.png) [@What\_Exit](https://boards.straightdope.com/u/What_Exit)\ **Post date:** [May 18, 2021, 8:30pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/2 "2021-05-18T20:30:03Z")
JIT manufacturing was always risky. _But it maximizes profits so it must be good._ As a programmer for manufacturing companies I always hated it. ---
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 8:38pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/3 "2021-05-18T20:38:33Z")
> [@What\_Exit](#): > > But it maximizes profits so it must be good. This is the suspect part though. It maximizes profits by reducing costs _when the supply chain is performing_. I would argue that a lot of industries are seeing some pretty horrendous balance sheets as a result of this gamble, so it’s not always profitable. Will companies do the math and come to the conclusion that this is a one-off event, or will they look at what might end up being 2-3 years of losses and a maybe permanent loss of market share and adjust their risk assessment? ---
**Author:** ![What\_Exit](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/what_exit/32/10652_2.png) [@What\_Exit](https://boards.straightdope.com/u/What_Exit)\ **Post date:** [May 18, 2021, 8:41pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/4 "2021-05-18T20:41:10Z")
I hope so, but car companies are the ones that led us down this path to start with and I suspect they won’t stop JIT. They might try to identify vulnerabilities where the don’t control their vendors though, like the Chip Makers. ---
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 8:46pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/5 "2021-05-18T20:46:22Z")
I’ve found the car company thing a little surprising to be frank. Aside from maybe Tesla, few cars will require anything close to bleeding edge technology. Seems like an amazing opportunity for them to take advantage of recycled smart phones/computers and eliminate entirely the dependence on new chip production. I’m pretty sure an iPhone 5 could run a Ford Focus with plenty of horsepower to spare. ---
**Author:** ![What\_Exit](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/what_exit/32/10652_2.png) [@What\_Exit](https://boards.straightdope.com/u/What_Exit)\ **Post date:** [May 18, 2021, 8:48pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/6 "2021-05-18T20:48:43Z")
As I recall from my JIT training back in the dark ages (the 90s), the car companies were so use to lording it over their vendors, I think they were honestly caught completely off guard by a vendor that didn’t really care about their business that much. ---
**Author:** ![Hampshire](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hampshire/32/4887_2.png) [@Hampshire](https://boards.straightdope.com/u/Hampshire)\ **Post date:** [May 18, 2021, 8:49pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/7 "2021-05-18T20:49:31Z")
If you try to combat shortages by building up an inventory how much is enough and does it really matter? Say company A is running JIT and keeps a weeks worth of raw materials at a time. Company B keeps 5 weeks worth of safety stock. A global shortage hits and neither company can get supplied properly for the next 12 months. Is that extra 4 weeks of production for company B worth the extra $$ of sitting materials and the space used to store them? ---
**Author:** ![Kent\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kent_clark/32/105_2.png) [@Kent\_Clark](https://boards.straightdope.com/u/Kent_Clark)\ **Post date:** [May 18, 2021, 8:51pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/8 "2021-05-18T20:51:38Z")
> [@Omniscient](#): > > I’m pretty sure an iPhone 5 could run a Ford Focus with plenty of horsepower to spare. Probably, but an iPhone 5 chip is not designed to operate for 6 years/100,000 miles, much of which is next to a hot engine block, subject to constant vibrations, and temperatures extremes which can range from \<0 to \>100. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [May 18, 2021, 8:54pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/9 "2021-05-18T20:54:11Z")
> [@Omniscient](#): > > Aside from maybe Tesla, few cars will require anything close to bleeding edge technology This is a major misconception. Modern cars are incredibly complex carefully engineered machines that require computer control for optimal efficiency. > [@Omniscient](#): > > Seems like an amazing opportunity for them to take advantage of recycled smart phones/computers and eliminate entirely the dependence on new chip production. I’m pretty sure an iPhone 5 could run a Ford Focus with plenty of horsepower to spare. You can’t take a modern automotive component and slot in some random used cpu that wasn’t designed for it. It’s not about cpu power on some artificial benchmark. The cpu in the automotive part has a whole set of capabilities that are extremely likely not present on the Apple chip. It’s also crazy to design an automobile around the idea that you’ll use whatever chips happen to be lying around after people upgraded their phones. ---
**Author:** ![nightshadea](https://avatars.discourse-cdn.com/v4/letter/n/7ba0ec/32.png) [@nightshadea](https://boards.straightdope.com/u/nightshadea)\ **Post date:** [May 18, 2021, 8:55pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/10 "2021-05-18T20:55:09Z")
> [@Omniscient](#): > > Lumber which is spiking prices for home construction/remodeling just today a relative of mine just about dropped dead and has to shelve a project until lumber prices go down He bought a “build your own storage shed kit” for about 250 or so … and all he has to buy is about 10 or so 2x4s and about 10 smaller blocks of wood for support, now normally he says this wood purchase would be between 80-125 or so … Well he went in today and said if he’d bought the wood at current prices it would be around 300 dollars …so the sheds now on hold ---
**Author:** ![ratatoskK](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ratatoskk/32/2987_2.png) [@ratatoskK](https://boards.straightdope.com/u/ratatoskK)\ **Post date:** [May 18, 2021, 8:57pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/11 "2021-05-18T20:57:04Z")
> [@iamthewalrus\_3](#): > > It’s also crazy to design an automobile around the idea that you’ll use whatever chips happen to be lying around after people upgraded their phones. LOL! 🧐 ---
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 9:01pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/12 "2021-05-18T21:01:42Z")
I regret starting this hijack. But obviously I know you can’t just swap parts ad hoc. My point is that a car manufacturer could design their systems from the ground up to use a specific chip/SOC that is known to have a very high availability on the wholesale recycling market. There are literally hundreds of millions of Intel/Apple/ARM chips in known specs floating around. And no, no car on the market except for Tesla requires even close to what a modern smart phone requires. ---
**Author:** ![mbh](https://avatars.discourse-cdn.com/v4/letter/m/a6a055/32.png) [@mbh](https://boards.straightdope.com/u/mbh)\ **Post date:** [May 18, 2021, 9:07pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/13 "2021-05-18T21:07:48Z")
Just-in-time has worked relatively well for several decades. One bad year, caused by a once-in-a-century epidemic, does not necessarily invalidate the concept. ---
**Author:** ![Omar\_Little](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omar_little/32/269_2.png) [@Omar\_Little](https://boards.straightdope.com/u/Omar_Little)\ **Post date:** [May 18, 2021, 9:11pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/14 "2021-05-18T21:11:29Z")
> [@Omniscient](#): > > And no, no car on the market except for Tesla requires even close to what a modern smart phone requires. ~~Deleted animated GIF, not allowed according to board rules.~~ ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [May 18, 2021, 9:12pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/15 "2021-05-18T21:12:12Z")
> [@Omniscient](#): > > And no, no car on the market except for Tesla requires even close to what a modern smart phone requires. I work in the embedded software industry. Among the customers I work with are numerous automotive component manfuacturers. I assure you that you are extremely incorrect about this. There is a lot more custom silicon with varying uses in a modern car than there is in a smart phone. ---
**Author:** ![Omar\_Little](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omar_little/32/269_2.png) [@Omar\_Little](https://boards.straightdope.com/u/Omar_Little)\ **Post date:** [May 18, 2021, 9:13pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/16 "2021-05-18T21:13:58Z")
> [@Omniscient](#): > > The pandemic has exposed serious, gaping holes in the supply chain, which have been exasperated by things like globalization and specialization. I think what you should have said is that the pandemic caused some gaping holes in the supply chain. The global supply chain should not be set up to constantly handle a once a century pandemic. ---
**Author:** ![Driver8](https://avatars.discourse-cdn.com/v4/letter/d/b5a626/32.png) [@Driver8](https://boards.straightdope.com/u/Driver8)\ **Post date:** [May 18, 2021, 9:29pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/17 "2021-05-18T21:29:32Z")
There’s a built in assumption in some of these responses that there is a problem here that must be solved. That may be true, but I’m not sure we have all the data yet to support that. Or, we certainly don’t have it in this thread. Reducing JIT to “maximizing profits” is something you can say about _any_ more efficient way of doing something and it seems overly cynical to frame it like that unless you’re making a claim of price collusion between automakers too. Incentivizing efficient production is one of the central claims to fame of the market economy system. So, are the shortages and corresponding price hikes of components more costly than the benefits accrued by using JIT for however long we’ve been using it? The answer isn’t obviously “yes”. It’s not obviously “no” either. If I just shrugged the whole situation off and said “yeah, it’s expensive to build a house or buy a car right now, but so what?” and that we can just wait for it to resolve itself given enough time along with continuing with JIT, would I be wrong? If so, why? And would mandating not using JIT make us better off? I can see the case for stockpiling and “strategic reserves” of basic items that threaten national security or could cause starvation or massive societal disruptions. But just for large temporary blips in the economy? That’s a justification that needs some numbers behind it. If you optimize for the once in a century event you’re doing a worse job during normal times. Have enough saved so that you survive the once in a century event, sure. But “survive” encompasses quite a lot, including having to put off that kitchen renovation for another year. ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [May 18, 2021, 9:42pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/18 "2021-05-18T21:42:53Z")
Also don’t forget that JIT gives you more flexibility to react to sudden changes. How many companies now are making masks and hand sanitizer? How many companies were doing so two years ago? If your business is built around the assumption of warehousing things for a year, then it’ll take you at least a year to pivot your business. ---
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 9:43pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/19 "2021-05-18T21:43:11Z")
> [@iamthewalrus\_3](#): > > There is a lot more custom silicon with varying uses in a modern car than there is in a smart phone. That’s a different statement than what I said. Custom yes…more demanding, no. For a simple example, the ECUs use something in the range of 1-5 MBs of RAM. These don’t NEED to be custom, but as @What_Exit noted car companies are very used to expecting this kind of stuff from their suppliers. In general, the computer chip recycling industry is under-utilized across most industries. ---
**Author:** ![Omniscient](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/omniscient/32/3290_2.png) [@Omniscient](https://boards.straightdope.com/u/Omniscient)\ **Post date:** [May 18, 2021, 9:46pm UTC](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392/20 "2021-05-18T21:46:22Z")
> [@Omar\_Little](#): > > I think what you should have said is that the pandemic caused some gaping holes in the supply chain. The global supply chain should not be set up to constantly handle a once a century pandemic. Other events can impact supply chains. This is an extreme event, but that doesn’t mean it doesn’t expose vulnerabilities to different events. [Next page](https://boards.straightdope.com/t/the-death-of-just-in-time-manufacturing/942392.md?page=2)