Volcano disrupts BMW supply chain to S.C.

The volcanic explosion that brought trans-Atlantic flights to a near standstill also has disrupted the supply chain at BMW Manufacturing Co., leaving a linchpin of the Upstate economy days away from running out of parts and thousands of families wondering about a possible work stoppage.

BMW said cargo flights it was using to transport transmissions and other parts to its sole U.S. plant near Greer were among those grounded by an ash cloud that spewed from an Icelandic volcano and swept across Europe.

With parts supplies dwindling, BMW slowed production at the local plant Monday in hopes of dodging a shutdown. Meanwhile, it scrambled to find alternate means of securing the parts.

"We're going to reduce our daily production so everybody is still working and see if we can get our way through this to the other side," said Bobby Hitt, plant spokesman. "If that doesn't work, and we run out of supplies, then we would actually curtail shifts."

BMW would make up any production lost as a result of the supply chain disruption, adjusting shifts as necessary, Hitt said.

He said "extraordinary efforts" were being made "on both sides of the Atlantic" to find alternate shipping routes and that BMW had moved transmissions to Spain in hopes of flying them to South Carolina.

BMW normally ships the transmissions by boat, but it has been shipping them by air lately as a way to address a lack of capacity at a European supplier, Hitt said.

"The whole industry has started growing back and as a result there's pressure on suppliers all over the world to try to grow back fast and that puts some restraints on the system," he said.

The local plant has been making about 600 X5 and X6 vehicles a day, but it will now make only as many vehicles as the parts inventory will allow, Hitt said.

"It's going to be pretty much day by day until the situation gets better," he said.

The plant employs about 5,000, including contract workers, and thousands more work at its suppliers in the area.

One of those suppliers, the Draxlmaier Group, was operating in Duncan normally on Monday while keeping a watchful eye on the situation in Europe.

Draxlmaier spokesman Ralph Schwarz said the company's Duncan plant, which makes instrument panels for the X5 and X6, gets 2 percent of its parts by air from Europe and could reach a critical point "in a couple of days" if the flight disruptions continue.

The situation in Europe hadn't affected U.S. manufacturing for Daimler AG, one of BMW's biggest competitors, as of Monday, spokeswoman Julia Engelhardt said.

But Daimler's U.S. plants, including its Mercedes plant in Vance, Ala., do get parts from Germany and could be affected if flights don't resume, she said.

Nissan North America makes transmissions in Mexico and ships others by boat from Asia and shouldn't be affected by the situation in Europe, said Scott Stevens, spokesman for the Nashville-based company.