Kinaxis is a supply chain specialist providing companies with an AI-infused supply chain platform to aid transparency and business planning. We asked Jonathan Jackman, VP EMEA at Kinaxis, about the outlook for automotive supply chain issues.
At the end of last year, semiconductor shortages impacting automotive companies emerged again. Will this be an ongoing issue in 2026?
Today’s semiconductor shortages are a pattern we will see repeat again and again in the next few years, as demand for chips grows across every industry, not just automotive. Each wave of shortages exposes how interconnected and fragile global supply chains have become, and how vulnerable they are to shocks such as the ongoing trade dispute between the US and China.
Jonathan Jackman
Do you think the disruption will get worse as AI applications in automotive expand?
It is likely that disruption will increase as AI applications become more deeply embedded in vehicles and manufacturing. AI-driven functionality significantly increases the dependence on advanced semiconductors, specialised components and complex supply networks. This heightens exposure to bottlenecks, capacity constraints, and geopolitical risk, particularly if critical technologies are concentrated among a relatively small number of suppliers.
That said, AI also plays a critical role in helping organisations cope with volatility more effectively. In an increasingly unpredictable global environment, AI can provide earlier visibility of disruption, faster insights, and better anticipation of risk, which enables more informed, agile decision-making across the supply chain.
Ultimately, success will hinge on how AI is applied. Organisations that use AI to orchestrate an end-to-end, adaptable supply chain, rather than limiting AI use to isolated functions, will be far better positioned to absorb shocks, respond to change, and maintain resilience as disruption becomes the norm.
What can companies in the auto industry do to mitigate the risk of future supply chain disruption?
The most important step is moving away from fragmented planning toward fully integrated, end-to-end decision-making. Our recent research with The Economist Group found that 71% of global businesses have accelerated their AI adoption, though only one in five can act on insights in real-time today. That being said, scenario modeling activity among auto manufacturers in November this year was more than three times higher than in November last year. This immense growth underscores just how rapidly the industry is scaling its investment in real-time risk analysis. When supply, demand and production plans are aligned in near real-time, companies can respond faster and with greater confidence as conditions change.
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Adaptability must be the industry’s central objective, and through new AI technologies, businesses can quickly build resilience and develop the ability to pivot as new challenges emerge. Orchestration will also play a key role, helping supply chain professionals move beyond constant firefighting and instead intentionally design “shock absorbers” into their supply chain.
We’re seeing this shift in action as over the last three months alone, scenario-modeling activity by automotive manufacturers using Kinaxis grew by nearly 500%. That’s almost a sixfold increase in scenario simulations since late summer, as companies leverage ‘what-if’ planning to test responses to everything from supply shocks to demand surges. This rapid acceleration is a clear sign that automotive brands are moving from reactive to true anticipation and orchestration, enabling them to respond with greater speed and confidence.
The companies that will thrive are not just those that invest in AI, but those that use it to accelerate adaptability at scale. That means rethinking roles, redesigning decision-making, and building human-plus-machine operating models that can anticipate disruption rather than simply react to it. For automative brands, moving beyond automation toward anticipation is going to be critical in an increasingly volatile world.
As a supply chain specialist, how do you feel the current supply chain challenges shape up against past challenges and industrial trends?
Historically, automotive supply chain models were shaped by a strong focus on cost efficiency and scale, with low-cost supplier outsourcing and just-in-time manufacturing at the centre of these models. These approaches worked well in an environment where demand patterns were relatively predictable and global trade flows were stable, but today’s challenges look very different. The automotive industry is facing more frequent and overlapping sources of disruption that aren’t going away anytime soon – just consider geopolitical tensions, semiconductor shortages, regulatory pressures and the EV transition, to name a few. These forces combined reveal how fragile just-in-time networks are, with little room to absorb shocks.
As a result, supply chains are evolving from lean cost centres into strategic functions that must balance efficiency with adaptability. The priority is no longer just reducing cost, but building networks that can sense disruption early, respond quickly, and continue operating as conditions change. This transformation is visible in the data: in the last three months alone, automotive scenario-planning volumes on our platform have increased nearly sixfold. This trend highlights how companies are not only aware of new risks, they’re actively building resilience and optionality into their networks through advanced scenario analysis and real-time orchestration.”
Are you optimistic that the auto industry can meet the supply chain challenges ahead given the huge challenges also presented by electrification, ADAS and other advanced tech that is relatively expensive? It’s a lot to manage strategically, isn’t it
I am optimistic, but only for businesses that are willing to fundamentally rethink how they plan and operate their supply chain. There’s no question that electrification, ADAS, and software-defined vehicles (SDVs) add significant cost and complexity, but at the same time, the industry is still under pressure to move faster and operate more efficiently.
The reason for my optimism is that many organisations are already recognising the need to change, and our research found that 67% of British businesses are already focusing on restructuring to reduce supply chain risk.
The key shift is the supply chain being treated as a strategic capability rather than an afterthought. The most advanced organisations are already showing that a tighter connection between product strategy, supply planning and execution is helping them manage complexity at scale and move faster and more efficiently. Those that embed advanced planning, orchestration and adaptability into their operating models are best positioned to turn disruption into a competitive advantage rather than a constraint and manage challenges today and in the future.
“How companies can plan for supply chain disruption and reduce risk” was originally created and published by Just Auto, a GlobalData owned brand.
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