How the global parts supply chain comes together

How the global parts supply chain comes together

Have you ever wondered, when you open up a transmission kit, how many nations all of these different parts came from? How many different journeys these parts had to make to get to where they are, sitting in your shop, ready to serve their purpose in a unit that needs them?

It would be apt to describe many modern transmission rebuild kits as being put together by a world network of contributing factories. It shouldn’t be a surprise that there is such a significant international factor in putting together transmission kits. The business world, and the automotive sector especially, have become increasingly global over the years.

Still, the scope of your average transmission kit can be staggering in the number of manufacturing nations it represents.

According to Andrew Ciszczon, marketing director for Freudenberg-NOK, parent company of TransTec, Freudenberg-NOK has more than 50 manufacturing sites worldwide and currently sources from about 34 countries.

For Precision International, to use another example, depending on the kit and the application, there may be anywhere from two to 12 nations involved in the supply chain for a particular kit, according to John Solazzo, vice president at Precision.

“It’s not every single kit across the board,” Solazzo notes. “Some kits are just very basic and everything’s from the U.S. And then there are others where it’s much more diversified.”

Naturally, there must be advantages to the way these companies have chosen to source their parts from around the world. So what are they?

One reason things are done this way, Solazzo says, is the global nature of many OEMs. “You’d be surprised,” he says, “how often the OE manufacturer is in Mexico, Europe, China, Taiwan.

“So, that would be one reason,” he continues. “The second reason is that we have established vendors that we like to do business with for certain commodities, whether it be a molded piston, an oil seal, or any other commodities.”

An additional advantage brought up by Ciszczon is that global manufacturing capabilities and sources allow TransTec to take advantage of proven technologies and materials that may not be as readily available in the U.S.

“As non-U.S.-based OEMs develop different technologies,” he continues, “we have more direct access to those technologies as a global supplier to those OEMs. Another advantage stems from our capacity not being restricted to one specific region. Thus, if demand fluctuates, we can adapt accordingly in normal business conditions.”

The current market has seen some serious complications, which we’ll get to, but even in the best of times, it’s a challenge putting together a kit with such a diverse number of manufacturers and nations involved in its production.

“One of the biggest challenges is coordination of deliveries based upon different lead times between components,” Ciszczon says. “All components must be available to produce a kit. For example, even if one one-cent O-ring of a kit with over 100 components is delayed or flagged for quality inspection, this can halt production of the kit. This mentality originates from the same systems and processes that ensure our quality to OEMs.”

Another related challenge is balancing inventory investment and kitting production without sacrificing customer service, Ciszczon mentions. “Despite current supply chain constraints we are still very selective in who we source product from and how it is manufactured.”

Additionally, Precision’s Solazzo notes that oftentimes kit manufacturers have to reverse-engineer the parts in designing a kit. 

“So,” he continues, “you’re getting the transmission, you’re tearing it down, and then you’re going to try to figure out what parts will need to be replaced, and then how you’re going to go about getting those parts.

“We usually have substantial inventory, and we’re able to build the kits out of stock. Lately, it’s been much more of a struggle.”

Today’s supply chain issues

So let’s talk about that struggle. The phrase “supply chain issues” has been said ad nauseum over the past two years, but it’s been happening for a reason. 

Most of it stems from the COVID-19 pandemic—production shutdowns and layoffs in early 2020, those same processes ramping back up as things reopened, and the resulting booming labor market.

Then there are the challenges that could not have possibly been predicted, like a ship getting stuck in the Suez Canal and temporarily torpedoing the global supply chain. Don’t pretend you saw that one coming.

Anyway, this has all created a perfect storm of delays, increased prices, and a generally much more difficult environment in which to put together a transmission kit, repair a car, or pay for repairs and receive them in a timely manner.

Solazzo used the word “extreme” three times consecutively in describing the delays.

“From all manufacturers—domestic foreign, OE, non-OE—everybody is having their own issues with product, and then getting the parts here, freight and price increases. Everything is so fluid and is changing by the minute. Your prices aren’t constant, your ability to get the parts isn’t constant, all of which leads to us not being able to service our customers the way we would like, and it just filters or trickles right down the line. The distributors aren’t able to service transmission shops, transmission shops can’t service their customers, so it becomes a whole big fiasco.”

Right now, he says, the biggest problem is the amount of time it takes to get a part. 

“Where a lead time used to be 60 days between placing an order and receiving the part, that’s turned into six, seven, eight months lead time now. So, it’s changed the whole dynamic of how we do things here.”

As he notes, there don’t currently seem to be any indications that this state of affairs will change anytime soon.

“It’s going to roll into next year for sure,” Solazzo says. “And what happens, unfortunately, is that once a price has been established, I don’t think many of the part manufacturers are going to come back to us and say, ‘You know what? We’re going to go back to our original price before all this.’ That’s going to be the price. So, the bar has been raised, our costs have been raised. 

“We’re willing to pay more for the part, and for freight, and to expedite the part here so we can build kits, which in turn means we’ve had to increase our kit prices, and our customers are willing to pay more to get the kit, to service their customers. Shops have come to the realization that parts are going to cost more right now.

“Obviously, the person who’s paying the most for it ultimately is going to be the consumer,” he concludes. “The bottom line is that this whole situation has hurt the public, the people who are spending the money.”

You May Also Like

Shift of the shaft: Diagnosing Chrysler 48RE manual shaft issues

The TorqueFlite transmission has been around since mid-to-late 1950s. There have been many changes surrounding the manual shaft and rooster comb through the years. This transmission shaft controls the position of the manual valve that directs oil for the gear ranges, but it also is used for a Reverse light control as well as Park/Neutral

The TorqueFlite transmission has been around since mid-to-late 1950s. There have been many changes surrounding the manual shaft and rooster comb through the years. This transmission shaft controls the position of the manual valve that directs oil for the gear ranges, but it also is used for a Reverse light control as well as Park/Neutral safety control. As it evolved, changes to these safety backup switches caused extra stress against the rooster comb that posed new challenges to the technician. 

Sometimes, a diagnostic code is all you need

With ATSG having the opportunity to help shops solve problems, sometimes we get faced with some real doozies. A shop will call and give us a laundry list of DTCs, leaving us to think someone must have a bulkhead connector unplugged. We then go through the arduous task of deciding which codes prompted other codes

10L80 and 10R80 pump gear differences

You may have seen an article in the August 2023 issue of Transmission Digest called “GM 10L80: A new kind of pump noise,” which goes over how the front cover housing in the 10L80 is fitted with a converter drive gear and idler gear. The idler gear drives the pump’s driven gear, and is press

Top 20 Tools and Products: The Winners

Transmission Digest readers voted during the past several weeks to select this year’s top products and tools from those nominated in our December issue. This year, rather than separate contests, voting was for a combined tool and equipment contest, with 20 winners rather than 10. Winning entries appear in the following images, but are in

top20Feature-1400
Performance supplier listings 2024

Below is TD’s compilation of manufacturers of components, parts, etc. for performance transmissions for 2024. Click the images below for company names and contact information. Related Articles – Jatco JF613E transmission quick reference material – Complete the 2024 transmission shop survey for a chance to win a gift card – Think pink: Curtis Price strikes

Other Posts

PRT launches new complete strut assemblies

PRT has announced the launch of new complete strut assemblies for light vehicles, SUVs and pickup trucks in the North American aftermarket. The launches include models such as Honda Civic, Jeep Cherokee and Toyota Highlander, in addition to brand new applications such as the 2021 Subaru Forester, the 2021 Toyota Corolla, and the 2021 Honda

PRT-Strut-1400
TransTec releases 6L80/90 Case Saver

TransTec has released a new Case Saver for 6L80 and 6L90 transmissions. Related Articles – Sonnax introduces Smart-Tech clutch kit for GM 4L series – Snap-on debuts new general service tool set  – Gray Tools introduces insulated hex bit socket set According to the company, Case Saver is a preventative tool that helps guard against

TransTec-Case-Saver.-1400jpg
AMN Drivetime: Strategies for a changing aftermarket

Jeff Koviak describes his “master’s degree” in the automotive aftermarket as owning two muffler shops in Port Huron, Michigan, for a few years. He was at the ripe, young age of 24 and this stint came after he served as a Walker Exhaust territory manager with Tenneco in Detroit. Koviak calls that his first official

Drivetime_ Koviak-1400x700
ZF Aftermarket introduced more than 770 new parts in 2023

ZF Aftermarket reports that it released more than 770 new parts over the course of 2023. According to ZF, those parts include 115 part numbers for ZF transmission products, including nearly 70 SACHS torque converters, and four different formulations of ZF Lifeguard e-Fluid for hybrid engines. A wide variety of other car and truck parts