How real-time visibility is playing a crucial new role in automotive supply chains

Feb 26, 2021
Supply Chain

The P&L of car manufacturers as well as that of their original equipment manufacturers (OEMs), whether tier 1, tier 2 or further upstream, are under increasing pressure and internal scrutiny as the global automotive market becomes more competitive and volatile. Aggressive and innovative new market challengers, such as Tesla, are redefining the automobile. Consumer tastes and demands relating to electric vehicles are shifting as a result.

At the same time, an industry already battling against unpredictable consumer demand, and one highly susceptible to economic instability, has faced a tumultuous global pandemic, resulting in violent sales peaks and troughs as communities deal with sporadic government lockdowns, travel restrictions and greater financial uncertainty.

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The crucial role of real-time visibility in automotive supply chain execution
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The crucial role of real-time visibility in automotive supply chain execution

Production plants are finding it difficult to manage their costs and scale up or down with the shifts in demand, since many job functions are specialized and require specific training hired. For instance, some specific tasks, such as seat cover sewing, require up to 3 months training for operators.

Production plant managers are asking supply chain designers, as well as industry trade bodies like VDA and ODETTE in Europe, to develop more efficient ways of carrying out day-to-day supply chain execution, to help ease this mounting financial pressure. Fortunately, new technologies and software platforms now exist to help tackle these significant and urgent industry challenges.

In fact, an enormous opportunity to save costs has been identified within the executional layer of automotive manufacturing, leveraging real-time visibility (RTTV), to quickly improve efficiency, reduce costs, and improve planning capabilities.

RTTV platforms help to cut costs, improve strategies and streamline day-to-day operations by enabling new capabilities including unequivocal root-cause analysis when troubleshooting thanks to discrete information sources.

These key use cases and benefits include leveraging RTTV to create efficiencies for material dispatchers, lessening assembly line halts, avoiding recalls with better quality control of parts, streamlining processes and communication between workers and partners, reducing safety stock, improving security of freight, and cutting both transportation costs and carbon emissions.

Beyond execution, RTTV benefits strategic and tactical efforts as well, enabling faster innovation and improved collaboration between ecosystem partners, enhancing planning capabilities, increasing agility and resilience and automating continuous improvement of supply chain operations.

From reactive to predictive automotive supply chain visibility

Download a copy of our latest white paper “The crucial role of supply chain execution” or get in touch with our team of experts to discover how leveraging new technologies to both eliminate unnecessary executional layer costs and increase flexibility and agility throughout automotive supply chains can help car manufacturers and their OEMs weather disruption events better, gain a competitive advantage and ultimately improve both customer experience and shareholder value.



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