Many of our Supply Chain Matters commentaries related to supply chain disruption and supply chain risk management relate to events that many would not believe would actually happen. This weekend featured the news that even iconic General Electric can be impacted by an unforeseen event, a devastating warehouse fire impacting a massive production facility.
Last Friday, a parts warehouse supporting GE’s home appliance factory complex in Louisville Kentucky was destroyed in a six-alarm fire. Nearly 200 firefighters battled the blaze and as of this writing, local news media reports indicate the hot spots remain. Luckily, there were no injuries since most employees had taken time-off for the Good Friday religious observance. According to media reports, the fire in Building Six raged for hours and required evacuation of the entire 900 acre Appliance Park factory complex. GE has since decided to suspend all production for at least a week while assessment of overall damage to operations and contingency plans are completed.
Appliance Park produces dishwashers, refrigerators, washing machines among other consumer appliances. Already, GE officials have indicated that an alternate space for the Building 6 warehousing operations has been identified and it does not anticipate any disruption for customers. A Wall Street Journal report quotes a labor union spokesperson as indicating that adequate inventory is available at an adjacent distribution center. These are obviously a timely business continuity response.
Ironically, GE had previously agreed to sell its home appliance business to Europe-based Electrolux for a reported $3.3 billion. The deal was expected to close later this year.
Generally, past events of this nature often provide a different picture once full assessments are completed. In the case of this warehouse destruction, assessment will focus on both product manufacturing and service parts supply chain needs. However, manufacturers such as GE have made investments in business continuity response and supply chain risk mitigation.
More news should be forthcoming in the coming weeks.