Global passenger car supply chain management: navigating economic downturn and recovery

The paper aims to highlight the impact of economic phases, namely, slowdown and recovery on supply chain of passenger car industry. Supply chain management becomes vulnerable during economic slow-down when the inventory builds up and production becomes unstable. At times of recovery the supply chain is characterized by backlogs when organizations explore all available opportunities and build resources as well as capabilities for growth and sustainable development. So far literature review shows that impact of customer’ choice, their behaviour and marketing variables on sales of passenger car have been studied to a great extent. Very few studies have been done on impact of economic conditions on sales of passenger cars and its consequent effect on supply chain. Recent economic downturns factor have left the supply chain managers clueless and take ad-hoc decisions. In this paper managing the supply chain of passenger cars during economic downturn and recovery period have been studied and decision making framework suggested for supply chain managers. The results show that a sale is sensitive to economic variables such as GDP, WPI, Fuel-Price, Inflation Rate, etc. This suggests that the supply chain decision framework needs to be integrated with the variations of economic conditions. This paper proposes a decision making model based on System Dynamic (SD) approach for enabling decision and policy makers to experiment with their policies and analyse the outcomes.