At the end of September, Ford stopped building its best-selling vehicle at its Dearborn Truck Plant. Every production crew there was canceled for nearly a week, through Tuesday, September 29, and Kansas City Assembly lost F-150 shifts to the same supply problem (Quartz, Sept. 25, 2026). Ford's CEO said the issue, with a supplier he did not name, had been fixed but was hitting third-quarter wholesale volume (Reuters via Investing.com, Sept. 30, 2026). Ford's own filing called it "a short-term supplier issue unrelated to aluminum" (Ford Form 8-K, Oct. 2, 2026).
One supplier. Two plants. Nearly a week of output.
Concentration Amplifies the Losses
Allianz Commercial's October 2026 analysis of 7,888 business interruption claims worth about €6.74 billion (2021 to 2025) found that claim frequency is stable but severity is rising, with the average claim value up more than 30 percent a year over the past two years (Allianz Commercial, Oct. 2026). Allianz also flags concentration: "Concentrated production is amplifying business interruption vulnerabilities," because many industries still rely on a small number of specialist sites, suppliers or geographies (Allianz Commercial, Oct. 2026).
The cost of stopping is frequently larger than the cost of the damage. Allianz puts the average business interruption claim above €850,000, about 70 percent higher than the average property damage claim of close to €500,000 (Allianz Commercial, Oct. 2026). In one case it cites, a fire in a small manufacturing unit caused limited physical damage but led to a nine-figure group-wide business interruption loss (Allianz Commercial, Oct. 2026).
The Pumpkin in Your Latte Has the Same Problem
Chain Reaction's planned pumpkin spice latte episode traces the drink back to the farm, and the pumpkin is the best lesson in concentration on the menu (episode planned; link added once posted). Illinois grew about 533 million pounds of pumpkins in 2025, slightly more than the other four top states combined, and nearly 70 percent of Illinois pumpkin acreage goes to processing (USDA ERS, 2026). In the village of Morton, about 85 percent of the world's canned pumpkin is packed at a single Nestlé/Libby's plant (Investigate Midwest, 2025).
Nothing about that is a failure. Allianz notes that many organizations concentrate supply in the name of efficiency, which also thins the margin of safety (Allianz Commercial, Oct. 2026). The risk is not that a single plant exists. The risk is not knowing it sits underneath three of your "different" suppliers.
Most Companies Lose Sight of Risk After Tier One
McKinsey's 2025 survey of 100 companies found that 95 percent have visibility into at least tier-one supplier risks, but that visibility reaches tier two or beyond for only 42 percent of them (McKinsey, 2025). Even among the 58 percent that have mapped their tier-two suppliers, fewer than half say they have regular direct contact with them (McKinsey, 2025). Leaders cited thin resources, tier-one suppliers reluctant to make the introductions, missing technology and a lack of senior priority (McKinsey, 2025).
That gap matters because diversification can be an illusion. A 2026 study in the International Journal of Physical Distribution & Logistics Management, summarized by Kühne Logistics University (KLU) on October 9, notes that multiple suppliers offer little protection "if several suppliers ultimately depend on the same factory, country, raw material source, or transport route" (KLU, Oct. 9, 2026).
Spend Is the Wrong Map
A traditional approach is to focus supplier risk work on the highest-spend suppliers (Simchi-Levi et al., MIT/Ford, 2015). A three-year research engagement between MIT and Ford found that approach can miss the real exposure. When the team modeled what each supplier site's disruption would cost, the impact was not correlated with how much Ford spent at that site (Simchi-Levi et al., MIT/Ford, 2015). The model flagged a low-cost sensor with high vehicle exposure that procurement had overlooked because of its low total spend (Simchi-Levi et al., MIT/Ford, 2015).
The same work gave two measures any team can use (Simchi-Levi et al., MIT/Ford, 2015):
| Measure | What it asks | Why it matters |
|---|---|---|
| Time to recover (TTR) | How long until this supplier node is back to full output after a disruption? | Suppliers may underestimate it, so treat their estimate as optimistic (Simchi-Levi et al., MIT/Ford, 2015) |
| Time to survive (TTS) | How long can you keep meeting demand without this node, using inventory and alternate sources? | Nodes with a short TTS are the ones to press for a detailed recovery plan; if TTS far exceeds TTR, the exposure is small (Simchi-Levi et al., MIT/Ford, 2015) |
Questions Every Sourcing Leader Should Be Able to Answer
- Which of your parts or ingredients come from only one plant, at any tier? Several suppliers offer little protection if they all depend on the same factory (KLU, Oct. 9, 2026).
- For your critical parts, how does time to survive compare with time to recover? Short-survival nodes are where the exposure sits, whatever the spend (Simchi-Levi et al., MIT/Ford, 2015).
- Which tier-two suppliers have you mapped but never spoken to? McKinsey found that most companies that map tier two do not keep regular contact with it (McKinsey, 2025).
- What would a one-week stop cost in lost margin, not just repair? The cost of being unable to operate frequently dwarfs the cost of repairs (Allianz Commercial, Oct. 2026).
- Is the supply truly replaceable, and how urgent is it? Those two questions decide which strategies are even possible (KLU, Oct. 9, 2026).
Five Moves for the Next 90 Days
1. Map one level deeper on your critical items. Start with the parts or ingredients that can stop a line, and work out which plants sit behind them. Expect pushback; tier-one suppliers' reluctance to facilitate contact with tier two is one of the reasons leaders cite (McKinsey, 2025).
2. Rank by exposure, not spend. Estimate time to recover and time to survive for each critical node, and flag every node whose time to survive falls below its time to recover plus a safety allowance (Simchi-Levi et al., MIT/Ford, 2015).
3. Talk to the tier-two plants that matter. Mapping is not the same as a relationship, and fewer than half of companies that map tier two keep regular contact (McKinsey, 2025).
4. Ask for a risk survey of your key suppliers. Allianz reports more companies now request risk surveys of critical third-party suppliers, a practice long used in automotive (Allianz Commercial, Oct. 2026).
5. Match the fix to the supply. A second source, a buffer of stock or a deeper relationship with one strong supplier can each be right. For scarce supplies that cannot be substituted, the study's lead author says a strong relationship with one powerful supplier may secure access better than superficial ties with several (KLU, Oct. 9, 2026). Allianz also cautions that even as companies invested in supply chain transparency and dual sourcing, tangible improvements such as better fire protection and larger inventory buffers have been limited (Allianz Commercial, Oct. 2026).
The Bottom Line
Ford found its gap the hard way. The better way to find yours is to look one tier deeper before something breaks. The work is not glamorous: a map, two time estimates and a few phone calls to plants you have never visited. Weigh that against what a week of lost output would cost you.
Know the plant behind the part.
