ORIGINAL: Veer
More likely because of the crew deserting. But as I said, it has the same effect so is not really worth arguing over.
I agree that the effect is what counts. Once a unit is unsupplied, it is going to ultimately wither away. Whether one accounts for that due to desertion or loss of fuel/ammo doesn't matter too much.
I believe the discussion is over the strength of the effects, not whether it happens or not. It does, units at 1% supply have a combat value of about 1/2 what they started at and Mvt. pts. of about 60%. Personally I think the penalties should be harsher. The combat value may be hard to change since the equation is hard coded into the game. Mvt. pts. for motorized units @ 1% should definitely be reduced however.
The residual combat strengths can range from the 50's to the 20's, depending on proficiency. I would not want those figures worsened. Good units should not be trivially reduced to helplessness after a single turn of combat. We don't want grandmothers with brooms easily wiping out the Hitler Jugend. Remember, these are units with valid lines of supply. If they are cutoff from supply they will properly wither away, but if they're not, they should be able to retain significant combat strength.
I continue to believe that the problem people are having with this issue resides entirely in their assumptions about what the unit supply numbers mean - not with the actual functioning of those units. Forget those numbers and just concentrate on how the units function. Should they or should they not be trivially reduced to zero combat strength after a turn of combat? I think that would be absurd. Provided that they have valid supply communications, they would never allow themselves to become so helpless.
Now, there are plenty of supply issues on the distribution end. We can't do amphibious supply, we can have infinite length supply lines, there are issues with things like port capacities, etc. Those do need to be addressed, and hopefully will be. But the expenditure end (what we're discussing) is actually kind of elegant. What other game out there accounts for the effects of diminishing returns?
The movement effects may be an issue, though - there is no distinction between foot movement and motorized movement - both drop to about 57% of full supply levels. But it still may not be a simple as you think. These are operational-scale units. How much fuel is consumed just supplying the unit and keeping it combat ready - as opposed to moving its location? The fuel cost to move (even a motorized unit) may be only a fraction of the unit's overall fuel consumption. So a good part of any fuel shortage may be already expressed in the unit's combat strength, rather than in its movement allowance.