[omasou]

I recently ordered a X6. I started researching the site to learn about features and unfortunately deletions. I'm tracking deletions here MY 2022 X5/X6 Option Casualties.

As I read other threads, a larger picture started to emerge showing that the problems we are experiencing are not solely related to "a chip shortage" that there is a perfect storm hitting us composed of raw materials, labor, logistics, off shore containers, etc.

I started this thread in an attempt to help understand the larger picture and how it may or may not even start to improve until 2023.

So if you're really that upset that BMW deleted your touchscreen and only provided a $500 credit, it may be time to take a step back and realize the grass is not any green, so go ahead cancel your order and try MB, Audi, etc. Good luck. I'll remain thankful that I can even consider to purchase this car and hope that those who build them will continue to have parts to continue making them in any form b/c the alternative is worse than the deletion of an option or two or three...

Global shortage of magnesium could cripple car industry

Magnesium Crisis Is Showing Signs of Easing

The global chip shortage is continuing to wreak havoc for the car giants

Why are so many Americans quitting their jobs?

Another 4 million workers quit in the 5th month in a row of record exits, and it shows how the pandemic is still making people rethink what they want out of work and life

No end in sight for labor shortages as U.S. companies fight high costs

ANALYSIS: Where Are All The Truckers?

Nearly half a million shipping containers are stuck off the coast of Southern California as the ports operate below capacity

[taek]

A lot of it is traced back to an energy crisis in China.

The irony is that in all the demand for more cars, including EVs and and more fuel efficient cars, we're going to be massively increasing coal production meet the worldwide demand.

https://www.forbes.com/sites/arielco...-consequences/

China also ordered coal production to expand significantly. Over 100 mines have received approval to expand production, with a possible 55 million tons of coal to be mined in the forth quarter. Share values of coal mining companies such as China Coal Energy and Shanxi Coking Coal Energy have nearly doubled this year as prices hit record levels.

The rollout of green energy sources in China did not replace coal – the backbone of China’s power sector.

[GrussGott]

Originally Posted by taek

A lot of it is traced back to an energy crisis in China.

There are many factors, though I'd say the largest for the auto industry is the JIT bomb (no planning for contingencies cuz lower quarterly bonuses) that's been warned about for at least a decade, combined with the sudden post-covid demand spike which has stressed all aspects of the supply chain (production, shipping, ports, distribution, etc).

Supply chain experts have been literally forecasting this problem for YEARS.

[omasou]

Originally Posted by GrussGott

There are many factors, though I'd say the largest for the auto industry is the JIT bomb (no planning for contingencies cuz lower quarterly bonuses) that's been warned about for at least a decade, combined with the sudden post-covid demand spike which has stressed all aspects of the supply chain (production, shipping, ports, distribution, etc).

Supply chain experts have been literally forecasting this problem for YEARS.

Agreed when reading the logistics section of the BMW Manufacturing at Spartanburg it's easy to see how one supplier can upset the entire process.

At BMW, it takes a strong logistics team to orchestrate a complex operation, bringing together the 20,000 fine detailed parts needed to build each vehicle. There are over 600 suppliers delivering parts to BMW from all around the world. Approximately 1300 truckloads, 2 air freight deliveries and 60 sea containers bringing around 7 million parts to the Spartanburg plant daily. Innovative production technologies and experienced associates ensure that these parts result in a premium quality product.

From what I have read companies have been attempting working around shortages not by inventorying product but instead by pre-buying a year's worth of product that is still manufactured and delivered using JIT. But when todays problems extend past those forecasts purchases or get stuck off shore or cannot be transported it throws a monkey wrench into the best made plans.

[GrussGott]

Originally Posted by omasou

JIT. But when todays problems extend past those forecasts purchases or get stuck off shore or cannot be transported it throws a monkey wrench into the best made plans.

yeah - it's a whole ironic thing but when Deming, Toyoda, Ohno and others designed JIT/LEAN/Kaizen/whatever the whole point was to work intelligently & eliminate waste such that the OUTCOME was minimal inventory including planning for contingencies & shortages...

Over the last 3 decades most automakers skipped over the parts about working intelligently, eliminating waste, and planning for contingencies; why do all that dumb stuff when you can just arm-twist your suppliers and get to low inventories without it??

The chip shortage is a direct result of:

(1.) Automakers use ancient chips (200mm derived) because they didn't want to pay for the testing of newer silicon

(2.) Automakers used to be able to skate by with vendors by just ignoring their requests for estimated volumes; true story: historically the chip makers used outside consulting firms to estimate volumes for their own customers because said customers felt comfy just staying mum until an emergency (cuz cheaper - why make a commitment before you know you absolutely have to have it??).

(3.) In 2020 covid killed auto demand

(4.) So when the very few 200mm chip makers asked their customer - automakers - for 2021 estimates, guess what? Auto makers said

(5.) So the 200mm chip makers just guesstimated lower volumes based on 2020 volumes and made commitments to other customers


And because demand for those old chips threatens to crater every year there's not much investor incentive to build new factories for ancient chips ... so capacity is pretty much locked.

And there's your JIT bomb, for just one part. And, because of EVs AND demand spikes, it's going to start happening with ever more parts ...

For example, if you're one of those 600 BMW suppliers who makes fuel pumps ... and you know BMW is planning chopping down ICE numbers what are you gonna do: make = or fewer fuel pumps?

These vendors aren't just gonna keep making ICE parts until BMW no longer needs them - they're going to start transitioning their capabilities to other stuff before BMW cuts orders and puts them out of business.

[omasou]

Some articles that I recently found.

BMW says chip shortage, raw material prices to hit second half

BMW has been less affected by the chip shortage than some of its peers which has been attributed to its strong relations with its suppliers.

"In light of a number of prevailing risks, including raw materials prices and a shortage of semiconductors, the second six-month period is likely to be more volatile for the BMW Group," Zipse said in a statement.

Chief Financial Officer Nicolas Peter said in a statement that BMW was able to offset the challenges of the chip shortage through "sheer hard work" but added "the longer the supply bottlenecks last, the more tense the situation is likely to become."

High prices, steady supply chain protect BMW from industry woes

"We have always had good oversight over our supply chain. That is paying off now - right down to the raw materials

[3Wagon]

Does anyone remember the Michael Keaton movie Gung Ho? When I think of what is going on at the BMW plant, I think of the end of that movie.

[TCBavarian]

Very good thread. I am glad you wrote this up.

[dananelson1]

Meanwhile, surging profits. There is some interesting and related comments imbedded in this longer article.

https://g80.bimmerpost.com/forums/sh....php?t=1871618

[LSU_Man]

Originally Posted by GrussGott

Over the last 3 decades most automakers skipped over the parts about working intelligently, eliminating waste, and planning for contingencies; why do all that dumb stuff when you can just arm-twist your suppliers and get to low inventories without it??

This. This. This.

I was an engineer at an auto plant a few years back. The vendors were made to dance for their money. If the auto company didn't want to deal with something, a vendor would do it - every time.

There is plenty of blame to go around, from the automakers to the unions to the suppliers. It doesn't matter who is blamed, the companies that figure out how to navigate this the best, will recover the quickest.

[omasou]

Seems like the aluminum/magnesium shortage is becoming serious and touchscreen will be the least of our concerns.

The chips crunch is easing. Now companies are warning of a new ‘international supply crisis of unprecedented magnitude’

The good news is the worst of the global chip shortage seems to be behind the auto industry.

Carmakers from Ford to Mercedes-Benz and Volkswagen have all indicated that the supply hiccups that were caused by recent COVID-related stoppages in Malaysian chip packaging plants appear to be easing in the fourth quarter.

The bad news is the next shortage of a key raw material could already be on its way.

Manufacturers are keeping a close eye on production levels of magnesium coming out of China, where a lack of power has led to rolling blackouts that hobble supply from energy-intensive smelters. Annual demand for the strong, lightweight material weighs in at 1.2 million metric tons, and it is found in many aluminum alloys to reduce the weight of car components ranging from body parts to engine blocks and wheel rims.



Volkswagen Group purchasing manager Murat Aksel told analysts on Thursday that his team was already taking countermeasures in the likely event that the supply becomes tighter.

“We cannot forecast right now if the shortage in magnesium and aluminum, which will happen definitely according to planning, will be bigger than the semiconductor shortage,” he said during a conference call.

Magnesium production dropped sharply in September, with analysts from Bank of America pointing in particular to smelters in coal-rich Inner Mongolia that were forced to shut down. Today’s remaining magnesium imports are trading at prices of about $10,000 to $14,000 per metric ton, up from just around $2,000 earlier this year.

Europe, the most exposed region, with 95% of supply sourced from China, is currently expected to deplete its magnesium stocks by the end of November, according to the investment bank.



“If aluminum producers ran out of magnesium, this would quickly feed through downstream, further exacerbating supply-chain issues,” they wrote.

“Crisis of unprecedented magnitude”

No less than a dozen different European lobby groups, including those representing the interests of vehicle manufacturers and component suppliers, warned of an “international supply crisis of unprecedented magnitude” in a statement.

“Without urgent action by the European Union, this issue—if not resolved—threatens thousands of businesses across Europe, their entire supply chains, and the millions of jobs that rely on them,” they wrote.

Despite the manufacturing industry's impassioned plea for help, individual corporations have avoided sounding so desperate. Executives at BMW, which navigated the chip crisis better than most, even dismissed the concerns over magnesium and alloyed aluminum outright this week.

Mercedes-Benz finance chief Harald Wilhelm told reporters on Friday the carmaker was evaluating the risk to its supply chain and examining whether to divert purchases to materials with reduced magnesium content or none at all.

"To my understanding this is due to power shutdowns in certain Chinese provinces that need to reach CO2 targets," he said. "I don't want to sound naive and overly optimistic, but in our view there's no structural problem (as is the case with semiconductor chips), nor do we see the threat that China no longer intends to supply the world with magnesium."



Stellantis, the Franco-American carmaker that emerged from PSA Group's acquisition of Fiat Chrysler, doesn’t expect its inventories of magnesium-alloyed aluminum will run out soon.

“In the short term we’re not seeing any issues. The sourcing of aluminum is relatively localized in our major markets,” finance chief Richard Palmer told analysts on Thursday. “Unfortunately China is not a major market for us at this stage. If the issues there start to [spread to] other markets in the medium term, we’ll see. But we’re not seeing anything at the moment.”

Carmakers are not the only ones exposed. The shortage could also affect another key transport industry that requires lots of lightweight materials: aerospace manufacturing.

For now, Airbus CEO Guillaume Faury told analysts that there have not been any significant disruption to his operations.

“I know it’s on the radar of our teams,” he said.

[GrussGott]

Originally Posted by omasou

Seems like the aluminum/magnesium shortage is becoming serious and touchscreen will be the least of our concerns.

The good news is the worst of the global chip shortage seems to be behind the auto industry.

Heard from some Toyota supply chain guys including one of the key SVPs, so take this with a grain of salt, but it matches what I've previously heard/read/discovered:

(1.) The chip shortage was caused by 1 thing: poor planning by legacy auto
On the part of auto manufacturers - which, of course, they're not going to disclose. Basically everyone's known for over a decade that 200mm derived chips are finite supply so if you want them you have to pre-order them, i.e. ahead of production need. If you don't and the supply goes elsewhere you lose. Well, automakers in 2020 didn't order any chips for 2021 so the chip makers extrapolated 2020 depressed orders into 2021 ... not only wouldn't that have been enough for a normal sales year, 2021 was a HUGE GROWTH year. Had auto makers put in orders with some decent forecasting they'd have been fine. We shouldn't expect auto makers to disclose that.

(2.) That poor planning wasn't just for chips
Auto makers have a long history of screwing their suppliers; i.e., not placing orders for contracted volumes since that's less certain to get an exec a yearly bonus, so they've just skipped that step and then threatened to move suppliers. Well, that shit don't fly any more. As the auto industry is ramping up to record proportions for EVs, companies willing to contract for guaranteed volumes - Tesla - are ... and slow stupid backwards auto companies - legacy auto - are getting forgotten. If BMW won't contract for 20 tons of magnesium for 2022, Tesla (or Toyota or Geely) surely will, so BMW has lost all its previous negotiating leverage its used for the last 20 years. Again, we shouldn't expect legacy auto makers to disclose these facts to us, instead we'll get BS stories about Malaysia

(3.) Toyota will ramp to normal prod 1Q22 and full prod 4Q22
Toyota is another company willing to contract for minimums, and they do! (since that's what TPS is all about) and they planning for "regular" production & sales by Q4 2022, with a "mostly regular" as early as spring 2022 ... what does "regular" mean? All vehicles & all options widely available for normal pricing.

[Firedad]

Maybe I’m in the minority here. But I don’t NEED a new car.

I WANT a BMW. I like the way it looks, how it drives, etc…
I have a really nice truck and it would last me the next 10+ years.

I’ve got a 1k deposit down, waiting for an allocation to order.

If the X5 isn’t what I ordered, or what I want. I’ll wait until it is. Doesn’t really matter to me.
Other than if they don’t figure their stuff out, I’ll start looking at Porsche/Audi/Mercedes instead if they’re able to provide what I want.

[omasou]

Originally Posted by Firedad

Maybe I’m in the minority here. But I don’t NEED a new car.

I WANT a BMW. I like the way it looks, how it drives, etc…
I have a really nice truck and it would last me the next 10+ years.

I’ve got a 1k deposit down, waiting for an allocation to order.

If the X5 isn’t what I ordered, or what I want. I’ll wait until it is. Doesn’t really matter to me.
Other than if they don’t figure their stuff out, I’ll start looking at Porsche/Audi/Mercedes instead if they’re able to provide what I want.

Might as well start looking at those other brands now and decide which one will disappoint you the least or wait until 2024 and hope thing are better by then.

[Firedad]

Originally Posted by omasou

Might as well start looking at those other brands now and decide which one will disappoint you the least or wait until 2024 and hope thing are better by then.

Oh I’ve been poking around. Will see how this order process shakes out. If it takes til 24 to get what I want, so be it. I’m not going to compromise though.

[omasou]

Biden Team Says Global Chip Shortage to Stretch Through 2022

[2022X6]

Took delivery of X6 today- No luxury seating meaning no massage, no cooled seats-
- and 2 days ago on Genius it Was On the build. Very very mad.

Car is loaded - looks great- but I've hit a back that hurts after a while in a car-

Unbelievable on a 90k car to drop this at last minute & no one tells you.

Seats are Merino extended leather.

Also- not able to write on the i controller, which I can live without

No soft close doors, which not necessary but sure are nice.

Beautiful car, but—

Very unhappy

[nZtiZia]

Originally Posted by 2022X6

Took delivery of X6 today- No luxury seating meaning no massage, no cooled seats-
- and 2 days ago on Genius it Was On the build. Very very mad.

Car is loaded - looks great- but I've hit a back that hurts after a while in a car-

Unbelievable on a 90k car to drop this at last minute & no one tells you.

Seats are Merino extended leather.

Also- not able to write on the i controller, which I can live without

No soft close doors, which not necessary but sure are nice.

Beautiful car, but—

Very unhappy

appears to be a bit of both dealer not disclosing as much as he could've in addition to your lack of research on what's standard or optional.

1) did you order the luxury seating package THEN it was dropped without telling you? if so then you should be given a credit, but it sounds like you didn't order the package in the first place. test: if you don't have the 20-way adjustable power seats, then you never ordered it because there's no shortage for those. for it to "disappear" from the build sheet would infer the dealer didn't order or forgot to order the package if you had wanted it. that's between you and the dealer to work out, especially if you paid for it
2) the non-touch iDrive controller has been known for a while now. it's not new news so to be expected.
3) soft close doors for G05/G06 aren't standard and have not been available as an option since MY21 started production mid-2020, so again, not new news.

[2022X6]

Originally Posted by nZtiZia

appears to be a bit of both dealer not disclosing as much as he could've in addition to your lack of research on what's standard or optional.

1) did you order the luxury seating package THEN it was dropped without telling you? if so then you should be given a credit, but it sounds like you didn't order the package in the first place. test: if you don't have the 20-way adjustable power seats, then you never ordered it because there's no shortage for those. for it to "disappear" from the build sheet would infer the dealer didn't order or forgot to order the package if you had wanted it. that's between you and the dealer to work out, especially if you paid for it
2) the non-touch iDrive controller has been known for a while now. it's not new news so to be expected.
3) soft close doors for G05/G06 aren't standard and have not been available as an option since MY21 started production mid-2020, so again, not new news.

Originally Posted by nZtiZia

appears to be a bit of both dealer not disclosing as much as he could've in addition to your lack of research on what's standard or optional.

1) did you order the luxury seating package THEN it was dropped without telling you? if so then you should be given a credit, but it sounds like you didn't order the package in the first place. test: if you don't have the 20-way adjustable power seats, then you never ordered it because there's no shortage for those. for it to "disappear" from the build sheet would infer the dealer didn't order or forgot to order the package if you had wanted it. that's between you and the dealer to work out, especially if you paid for it
2) the non-touch iDrive controller has been known for a while now. it's not new news so to be expected.
3) soft close doors for G05/G06 aren't standard and have not been available as an option since MY21 started production mid-2020, so again, not new news.

Neither correct, dealers have no say in why's dropped during production processes.

Up to 2nd last day of production My bmw production timeline showed Luxury package was on the list, then 2 days it later it shows at dealer without it. I have spec sheet from the dealer when I ordered it showing with the luxury package . I read Bimmerpost every day for 3 months, I'm in top of it. I complained to the dealership today and they are at a loss as of why it happened.

Of course soft close have not been avmbke on the 40 for a long time. I can live wo those And scrolling on the control is not really needed, I also have a 2020 X5 that has all that, I think I've used it twice in two years

It's a drag this happened, but COVID finally affected me- Good news is I have a new X6, panzer grey / blacked out- 22' black rims , and as soon as the New Model X6 comes out I'm ordering it- biggest engine & all options.


Turtleboy is the master & I would like to hear what he says about why the luxury package was nuked at the last minute.

[TurtleBoy]

Originally Posted by 2022X6

It's a drag this happened, but COVID finally affected me- Good news is I have a new X6, panzer grey / blacked out- 22' black rims , and as soon as the New Model X6 comes out I'm ordering it- biggest engine & all options.


Turtleboy is the master & I would like to hear what he says about why the luxury package was nuked at the last minute.

Congratulations and sounds like a good plan. Not sure about the master part but my guess is that it was a production mistake. As far as I know the Luxury package does not have a production constraint on it. They may have just put the wrong seats in and then it was caught during QC and the VIN details changed.

Good luck, enjoy and be safe.

[nZtiZia]

Originally Posted by 2022X6

[…]Up to 2nd last day of production My bmw production timeline showed Luxury package was on the list, then 2 days it later it shows at dealer without it. I have spec sheet from the dealer when I ordered it showing with the luxury package

did the dealer make a price adjustment or give you a credit (if you paid for it)?!

FYI, no need to hit both the +" and the " icons (bottom) when including a quote in your reply. doing so is causing double quotes which can get quite lengthy