I’m writing now with an update on the long lead times we have been experiencing all year. The good news is that we have significantly increased our build capacity since my last communication. Unfortunately, as you are no doubt aware, lead times have not yet improved. This is because new orders continue to outpace our available capacity. Steps we have taken and continue to take include:
• In-sourcing as many critical components as possible.
• Embedding Associates at key suppliers and bringing new suppliers online to increase output for the parts we need to build our systems.
• Aggressively recruiting and hiring new Associates and working with our suppliers to do the same. To that end, we have added recruitment bonuses and are ensuring our wages are competitive.
Even though we are doing everything we can, it is important to understand that it will take us several months to work through what is a very significant backlog. We continue to expect lead times to stabilize this quarter, however, we do not expect to see any significant reduction in lead times until the end of the third quarter. Until then, we will continue to do our best to prioritize orders considering many factors.
We will provide you with updates as circumstances change so that you know what to expect and can plan accordingly. You can also access the latest lead times via the Hypertherm Xnet. These lead times are reviewed by our team once a week and updated when needed.
In closing, I’d like to once again offer a sincere apology for any inconvenience this situation is causing. Please know we appreciate your support and partnership as we navigate through this. If you have any questions, please do not hesitate to contact your Hypertherm sales representative.
Marco Mostert
Regional Director EMEIA