Navigating the Supply Chain Crunch

In a normal year, developing your plan for vehicle replacements and ordering is likely among your top two or three strategic priorities. Unfortunately, this year is unlike any other in recent memory and disruptions across the supply chain are turning this traditionally rather mundane task into a full-blown nightmare. Perhaps the biggest question across the entire automotive industry – when will the vehicle supply chain normalize?

With this topic very much top-of-mind for most across the fleet sector, ARI’s Ted Davis recently spoke with Automotive Fleet to discuss the latest challenges and examine the factors that will help bring stability back to a highly disrupted supply chain. In the article, Ted says supply constraints are likely to linger to some extent into 2023 and shares why it will take an industry wide effort to overcome the current challenges.

“The rate at which the supply chain normalizes will vary significantly for each OEM. Some OEMs are better positioned to rebound from the ongoing disruptions more successfully than others. As a result, there’s likely to be increased demand pressures on those manufacturers who bounce back quickly, likely extending the industry wide challenges further until the majority of OEMs can normalize their supply chain.”

Ted also highlights why it is important to collaborate closely with your fleet provider to thoroughly analyze your operating data and remain agile during this period of volatility. To navigate the uncertainty, Ted recommends reevaluating, and when necessary adjusting, your replacement cycling to align with current market conditions. And, when possible, keep it simple.

“Most fleet operators will be best served to streamline vehicle specifications, creating more simplicity and consistency in vehicle design to mitigate supply chain risks.”

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