Building a Resilient and Sustainable Automotive Supply Chain

The automotive industry is facing challenges such as an aging vehicle fleet and a semiconductor shortage amidst increasing global car sales. Disruptions in the automotive supply chain can have detrimental effects on the industry. Many companies are now realizing the importance of rebuilding supply networks to remain viable and meet the evolving needs of the market.

Automotive supply chain facts

Up to 50 percent of unscheduled downtime is due to a lack of spare parts or stockouts (The Importance of Inventory Optimization in MRO, July 2015, Aberdeen Group)

3 tips for accelerating the path to a more resilient and sustainable automotive supply chain

1. Monitor supply to minimize production delays and reduce the time needed for critical supply chain disruption management.

Improving monitoring and forecasting can give automotive organizations clear visibility into the availability of materials for manufacturing, especially for hard-to-procure components like semiconductors and rare earth metals.

2. Optimize maintenance inventory, increase reliability, and ensure production schedules are met.

By assigning criticality to assets and items, automotive organizations can make better stocking decisions and free up working capital that may be tied up in costly maintenance parts.

3. Provide an enhanced ordering experience to customers while accelerating growth and profitability.

B2B automotive companies are under pressure to deliver digital experiences on par with those in the consumer space. Gaining real-time inventory visibility can help organizations to be more proactive in inventory management and meet customer orders with more efficient deliveries.

How IBM Supply Chain solutions can help

IBM offers solutions to enhance the ordering experience, optimize inventory, and monitor supply in the automotive industry. IBM Sterling OMS provides an enhanced ordering experience and accelerates growth and profitability. IBM MRO IO optimizes inventory with accurate forecasting and budgeting, and IBM Supply Chain Intelligence Suite enables monitoring of supply to minimize production delays and facilitate collaboration. Additionally, IBM Consulting offers supply chain services for the automotive industry.

IBM Consulting: Supply chain services for automotive

IBM Consulting is a global leader in supply chain consulting with expertise in the automotive industry. Through strategic partnerships, access to proprietary technology, and a dedicated sustainability practice, IBM Consulting helps automotive companies design and build resilient and sustainable supply chains that accelerate growth and deliver the next generation of mobility solutions.

FAQs

What are the challenges faced by the automotive industry?

The automotive industry is facing challenges such as an aging vehicle fleet and a semiconductor shortage amidst increasing global car sales.

Why is it important to rebuild supply networks in the automotive industry?

Rebuilding supply networks is important for the automotive industry to remain viable and meet the evolving needs of the market.

How can the automotive industry address supply chain inefficiencies?

The automotive industry can address supply chain inefficiencies by improving monitoring and forecasting, optimizing maintenance inventory, and providing an enhanced ordering experience to customers.

What solutions does IBM offer for the automotive industry?

IBM offers solutions such as IBM Sterling OMS, IBM MRO IO, and IBM Supply Chain Intelligence Suite to enhance the ordering experience, optimize inventory, and monitor supply in the automotive industry.