MORE than half of German companies doing business abroad are hit by severe problems in their supply chains or logistics, pushing them to diversify suppliers, shorten delivery routes and also relocate their own production, a survey showed Tuesday. The German economy, Europe’s largest, has boomed on the back of globalization over the past decade. But pandemic-related disruptions in the worldwide network of supply chains that used to turbo-charge its growth engine are now proving a critical weakness. Shortages of semiconductors and other industrial components are threatening to bring Germany’s economic recovery to a standstill, forcing executives to re-think supply lines and try to reduce reliance on a handful of Asian and U.S. suppliers. The survey by the DIHK Chambers of Industry and Commerce among 3,200 of its members doing business abroad showed that the supply chain woes in world trade have become worse: More than half of the companies reported problems in their supply chains or logistics, up 14 percent compared to the spring. “Rising global demand is currently coupled with insufficient production capacities and transport problems,” DIHK trade expert Volker Treier said. The reasons for the disruptions are manifold, ranging from a lack of containers and freight capacities on ships as well as production stoppages caused by COVID restrictions as well as missing components. The supply chain disruptions can also be traced back to serious trade policy distortions by other governments, such as regulations forcing German companies to produce certain intermediate goods only locally, Treier said. In view of those problems, 54 percent of companies are planning to adapt supply chains or have already done so, the survey showed. Of those companies, 72 percent are looking for new or additional suppliers, 32 percent are planning to shorten or change delivery routes and 15 percent are determined to relocate their own production. (SD-Agencies) | 