While the digitalisation of supply chain processes upstream from vehicle manufacturers has been underway for many years, the processes downstream from the manufacturer have been somewhat neglected up to now.
Radio Frequency Identification (RFID) is becoming an increasingly important Auto ID technology in the automotive industry. It is used to identify assets, track the movement of parts, packaging and transport equipment through the logistics process and record the use of components and assemblies in production.
Automotive OEMs encourage the use of Returnable Packaging, generally known as Returnable Transport Items (RTI), to move parts from their suppliers to their production lines or after-sales facilities. RTIs enable companies to eliminate the costs involved in the disposal of one-way packaging such as cardboard boxes and also help to reduce the environmental footprint of the automotive industry.
The past months have seen an exceptional level of industry co-operation as OEMs and suppliers have worked together at Odette to agree new European profiles of the Global Transport Label.
In the automotive industry, there are many supply processes which do not rely on stock, such as Just in Time (JIT) or Just in Sequence (JIS) deliveries. However, these processes are not always appropriate and stocks are often used to ensure a seamless production process and insure against any possible disruption in the supply chain.
In cases where an invoice for goods shipped to another EU country is exempt from VAT, or applies the VAT reverse charge procedure, companies based in Germany are required by law to provide documentary evidence that the goods have physically reached the recipient in the other EU country.
During the development of the Supply Chain Risk Management Guidelines, the project team created a Risk Categorisation Matrix, comprising details of the possible Supply Chain risks and their causal factors. Analysis of the matrix showed that one of the OEM’s primary Supply Chain risks is the availability of adequate and proven production capacity at the supplier’s site.
For many years organisations have used contingency plans to mitigate the worst effects of a potential supply risk. However, with companies now requiring ever-greater flexibility, shorter lead times and reduced inventories from their long-distance, global supply networks the probability of a supply failure has become heightened.
You will have read above about the recently published Odette Guidelines for Collaborative Forecasting which provide a methodology to improve the accuracy of demand forecasts. Now Odette Sweden has developed a practical tool which helps to put the recommendations into practice.
For many years the automotive industry has suffered from deficiencies in the holistic forecasting and planning process that is used to determine the demand profile for parts and assemblies required from the upstream supply chain. The impact of inaccurate forecasts has come more sharply into focus as a result of difficulties in the business climate coupled with greater expectations from customers.
