Supplier decisions rarely fail overnight. They expire quietly. Our new industry insight is about the sourcing awards made 15 or 20 years ago that were genuinely right at the time, and about what happens when nobody goes back to check the calculation behind them.
The old global sourcing logic was rational. European industrial groups built local supplier networks for China because China was becoming a major target market, then found that some of those suppliers became very good and started using them for European products too. Cost position, capability, scale and technical maturity all pointed the same way. The article does not call that a mistake. Its point is that a sourcing decision which was logical in 2005 should not automatically survive into 2026.
Almost everything the calculation rested on has moved since. Freight is volatile, energy costs differ sharply by region, working capital is expensive again, export controls have appeared where there were none, and qualification and ramp-up for an alternative supplier realistically takes months. The supplier base itself is under strain at the same time: Oliver Wyman counts 257 automotive supplier insolvencies between 2020 and 2025, with 59 in 2025 alone, and EY records German supplier insolvencies at a 14-year high.
The distinction the article insists on is between the supplier and the business case. A supplier can hold its approvals, deliver acceptable quality, sit in the ERP system and be familiar to engineering and purchasing, while the award behind it is out of date. Over time the original cost logic disappears behind master data and a strategic sourcing decision turns into a habit, and habits are rarely challenged until something breaks. The insight sets out how to recalculate those decisions at part level before that happens.
