Evaluation of Automotive Supply Chain Risks: An Empirical Research

This paper aims to investigate the vulnerability of supply chain and figure out the key supply chain risks by conducting an empirical study of supply risk management at Shanghai Automotive Industrial Company (SAIC), a large-scale automobile company in china. The analysis based on the survey conducted with SAIC and its downstream and upstream companies. Before carrying out the survey, we make the hypotheses of risk path models from four aspects i.e. supplier, manufacturer, distributor and customer. Then according to the data we collected, we verify the hypotheses and identify the supply chain risk factors using the Confirmatory Factor Analysis model. After that, we use the WBS-RBS method to evaluate the two-level risk factor model. And we find that supplier's financial risk, manufacturer's strategic risk, distributor's financial risk are the highest risk drivers. More explicitly, production cost increase contributes most to financial risk and unqualified R&D ability, less competitive product and inaccurate demand forecast can bring strategic risk for the core manufacturer, SAIC.