Globalization making major impact on automotive industry

The findings of this study are based upon interviews with automotive manufacturers and suppliers in the U.S., Europe, and Asia
By SCMR Staff
December 14, 2010 - SCMR Editorial

IDC Manufacturing Insights has announced the availability of a new report, The Assembly Plant of the Future—Restructuring Global Manufacturing to Meet the Challenges of the Global Economy, which discusses the challenges of global manufacturing and how forward-looking automakers are restructuring both design and manufacturing strategies to improve efficiency and remain competitive.

The findings of this study are based upon interviews with automotive manufacturers and suppliers in the U.S., Europe, and Asia.

According to the report, the automotive industry is undergoing dramatic changes as it copes with new economic realities, seeks to meet shifting demands in consumer preferences, and incorporates new technologies to improve energy efficiency, safety, and comfort.

“The manufacturing of automotives today has not fundamentally changed since 1913 when Henry Ford revolutionized the assembly process by creating the moving assembly line,” said Joe Barkai, practice director, Product Lifecycle Strategies at IDC Manufacturing Insights. “It is clear, based on our research, the manufacturing process must be improved dramatically in order to meet the economic and technology challenges of 21st-century global manufacturing.”

IDC Manufacturing Insights research indicates that the impact of globalization, growing operational complexity and diverse markets and consumers demand that overall manufacturing strategy should shift from economy of scale to economy of scope, focusing on global flexible manufacturing capabilities.

A “design anywhere, make anywhere, sell anywhere” strategy will lead to the formation of a global plant floor. Moreover, automakers will improve portfolio-level planning and incorporate design for capabilities in the design of future vehicles.

No one strategy or approach can meet all these needs and survive the rapid rate of change, the IDC Manufacturing Insights study shows. Manufacturers will have to use a blend of strategies and undertake several process improvement initiatives to realize the architecture necessary to enable the plant of the future.

Among these process improvements are the adoption of emerging IT technologies and operating models – especially in pervasive communication, cloud-based architectures, and mobile devices – which will provide a solid foundation for powering the assembly plant of the future.



Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Working with research partner, The Economist Intelligence Unit, the IBM Institute for Business Value surveyed 1,023 global procurement executives from 41 countries in North America, Europe and Asia.

U.S. Carloads were down 7.8 percent annually at 259,544, and intermodal volume was off 15.7 percent for the week ending February 21 at 213,617 containers and trailers.

The Department of Transportation’s Bureau of Transportation Logistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement partners Canada and Mexico in December 2014 was up 5.4 percent annually at $95.8 billion. This marks the 11th straight month of annual increases, according to BTS officials.

While the volume decline was steep, there was numerous reasons behind it, including terminal congestion, protracted contract negotiations between the Pacific Maritime Association and the International Longshore and Warehouse Union, and other supply chain-related issues, according to POLA officials.

Truckload rates for the month of January, which measures truckload linehaul rates paid during the month, saw a 7.9 percent annual hike, and intermodal rates dropped 0.3 percent compared to January 2014, which the report pointed out marks the first annual intermodal pricing decline since December 2013.

Article Topics

News · Global · Technology · Supply Chain · Manufacturing · Economy · Plan · Make · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.