Supply chain risk was a child of COVID-19. With mass lockdown, industrial closures, limitations on transportation and shipping, supply chains were stretched. This was then exacerbated post COVID-19 as the world ramped back up to normal and supply chains unable to cope. This manifested in delivering delays and higher transportation costs along the entire value chain.
Now geopolitics are entering the mix of reasons for supply chains disruption. Protectionism and tariffs are increasing costs - project developers have been bulk ordering to try and get ahead of the curve - and reshoring are pushing up costs further. Restrictions on exports are adding to the woes. Think US CHIPS Act and Chinese restrictions on rare earths exports.
All this at a time when the world needs an affordable and functioning supply chain to deliver the energy transition, growth in power demand and AI compute.
This is what happens when supply chains were built for just-in-time to slim down costs and working capital. What the world needs now to rebuild is a just-in-case supply chain.
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