The provision chain and logistics heads of Indian automotive and part producers are nonetheless haunted by the disruptions that began with the Covid-19 pandemic. Nevertheless, there are higher options now accessible to sort out these points with expertise and digitalisation taking it up.
“The worldwide power transition and altering emission norms are placing automotive and part producers into a really distinctive and tough place as we’ve to fund the present product line to satisfy the tighter and greener norms and on the similar time make investments sooner or later power.”
That is how Shubhankar Chatterji, chief provide chain officer of Cummins India responded to the questions on how Cummins India is managing the altering enterprise surroundings.
He was talking throughout the seventh version of the Auto SCM Summit on December 5, 2023, organised by Indian Transport & Logistics Information. Introduced by Frankfurt Airport, AutoSCM Summit 2023 additionally had Dachser as Supporting Accomplice and Hong Kong Air Cargo Terminals (Hactl) as Sustainability Accomplice.
Chatterji additionally spoke concerning the investments and efforts they’re placing into reworking the trade and enterprise. “The nice half is that Cummins India is into all alternate energies. For instance, we acquired the world’s fourth-largest producer of gas cells and electrolytes,” he stated.
Speaking concerning the significance of visibility within the provide chains, Mandar Vaidya, Director of Supplies Administration, Area India, ZF Group, stated, “For at the very least the incoming provide chain we need to know the place they’re. The identical applies to our clients who’re the OEMs, be it for the manufacturing course of or spare elements. Past resilience and visibility, if there’s a shift in expertise or shopper choice, the provision chain can plan or anticipate them.”
He additionally talked about the necessity for stakeholders to be agile when a disruption hits to take care of it within the quick time period in addition to the efforts to take it again to regular in the long run.
Digital options for disruptions
It was on the identical strains that Om Vijayvargiya, Head – SCM & Logistics, Schaeffler India, spoke concerning the charge with which the demand fluctuations occur out there and the way managing inventories is at all times an issue for automotive producers and their logistics firms. Nevertheless, on a optimistic be aware, he additionally talked about that new options, notably digital options, coming into the market.
He stated, “Throughout the Covid-19 pandemic, the trade understood the necessity for agility and resilience. One of many greatest challenges was the absence of real-time visibility of our consignments and the shortcoming to plan our manufacturing due to that.”
“Within the final three years, many visibility options have been coming to the floor and now with these options, we will plan our manufacturing accordingly. Manufacturing schedules are additionally getting settled accordingly. Generally the consignments arrive early can be a difficulty as a result of the inventories are additionally going up. And on this case, visibility may help us to chop future orders,” he added.
Constructing on the challenges in managing the inventories, Yogesh Ramtekkar, Head of Provide Chain Administration, PV Clear Mobility Applied sciences, identified the significance of gross sales projections and predictions in addition to the communication hole.
“I believe the communication hole between OEMs, Tier 1, Tier 2 and Tier 3 suppliers is among the most necessary challenges. It applies to abroad suppliers as effectively, as a result of as an example, the transit time from the US is 60 to 90 days and any problem to the free move of data can adversely have an effect on the trade,” he stated.
Empowering the way forward for logistics
The Japanese EV firm Terra Motors’ chief govt officer Akihiro Ueda spoke concerning the EV manufacturing at Terra Motors, the charging infrastructure supplied by Terra Cost and the financing options supplied by Terra Finance along with his presentation titled “Empowering the way forward for logistics.”
In truth, in December 2023, Terra Motors introduced the launch of its blanket answer to impress last-mile supply that features L5 Loader automobiles, EV financing, charging infra, and software program options.
He additionally spoke concerning the present standing of EV adoption in India and the way the Return on Funding (ROI) for EVs amongst logistics firms are excessive. “It makes lots of financial sense,” he stated.
Digitization of worldwide logistics for auto clients
“Automotive clients are on the lookout for higher visibility of charges and routes as there may be lots of uncertainty all through the provision chain.”
Madhumeeta Kumari, Enterprise Gross sales Lead at Cogoport was delivering her presentation and spoke about how the digital freight forwarder helps their automotive clients to navigate the worldwide logistics enviornment.
“The purchasers are on the lookout for longer contracts and shorter routes to make sure higher buyer expertise and sooner deliveries. The digital freight forwarders are additionally venturing past worldwide transport into customs, CFS and last-mile supply to assist these clients take care of provide chain points successfully. These firms additionally possess information of the most recent developments and adjustments within the trade and thereby assist clients to take higher and sooner choices,” she stated.
Tech developments for a seamless provide chain
Reflecting on the teachings discovered lately from a strategic standpoint, Hirendra Digvi, Govt Director of Divgi TorqTransfer Methods, emphasizes the significance of financial and geopolitical safety within the present situation. He factors out that for the automotive trade to thrive, whether or not in electrification, automation, or different key applied sciences, understanding the present place and sources of expertise is essential. Digvi highlights the need for provide chain safety, stating, “No investor would purchase the technique if I say that I can develop into the primary EV provider however be 70% depending on China. I will need to have provide chain safety that permits me to make my long-term worth propositions sustainable.”
JP Mishra, Nation Supervisor-India at Newland AIDC, a world RFID producer, shares insights from his in depth expertise within the automotive trade, emphasizing the pivotal position of RFID (Radio Frequency Identification) expertise in enhancing provide chain transparency and knowledge administration. Mishra underscores the multifaceted advantages of RFID, explaining the way it permits the meticulous monitoring of parts, instruments, and equipment, thereby considerably elevating operational effectivity. Up to now, committing to tentative dates for shoppers was difficult, however with RFID, companies can now calculate logistics, stock, and manufacturing plans via a unified platform. “Not like earlier than, now you possibly can decide to a tentative date for shoppers by calculating logistics, stock, and manufacturing plans via a single window. This not solely enhances the corporate’s goodwill but in addition affords improved visibility throughout all the system,” he added.
Mishra contends that RFID expertise is a game-changer, empowering companies to optimize their operations, construct shopper belief, and navigate the complexities of contemporary provide chains with precision and reliability. “Many people within the logistics sector hesitate to undertake RFID expertise as a consequence of issues about elevated prices. Nevertheless, it has gained important recognition, notably within the automotive sector, the place the demand for swift deliveries is paramount,” he added.
Vijendra Singh emphasizes developments in monitoring and enhancing visibility inside the provide chain via the incorporation of a number of alarm experiences, geo-fencing, and RFID expertise. He notes the transition from handbook information assortment to a extra environment friendly push mechanism. By implementing geo-fencing for suppliers, OEMs, and their very own hubs, coupled with RFID tags, real-time information provision has develop into a actuality. Singh highlights the affect on customer support, stating, “Now, dashboards are offering us extra visibility of the real-time location of the elements.” This evolution in information acquisition strategies signifies a proactive strategy, leveraging expertise to streamline processes, enhance accuracy, and supply clients up-to-the-minute data on the standing and placement of their supplies.
Tech-driven value reductions in auto provide chain
The automotive trade confronted unprecedented disruptions and vulnerabilities throughout the Covid-19 pandemic, largely attributable to the Simply-In-Time (JIT) provide chain and manufacturing mannequin. This strategy, designed for effectivity, was uncovered and disrupted like by no means earlier than.
The mixing of expertise into logistics operations has considerably enhanced responsiveness, resilience, and visibility within the provide chain. Deepak Tiwari, COO of KSH Logistics, notes the optimistic affect on coordination and effectivity, stating, “Earlier we used to have so many individuals coordinating; clearly, these have gone all the way down to some extent. Secondly, with automated billing coming into the image, persons are additionally decreasing in that space. We’re seeing lots of discount in prices in sure areas.”
This technological evolution not solely streamlines operations but in addition leads to tangible value reductions. Automated processes, optimized routing, and data-driven decision-making contribute to a extra environment friendly and cost-effective provide chain, finally benefiting each logistics firms and their companions. Talking about the identical, Surendra Gupta, AVP of Apollo Provide Chain, explains, “We’re utilizing route optimization, planning routes primarily based on the pin codes of distributors or clients. This system we have constructed suggests higher routes primarily based on proximity and former experiences, serving to lower the price of distribution. We move on these financial savings to our OEMs. Such applied sciences usher in effectivity, contributing to the general discount in prices.”
This technological evolution not solely streamlines operations but in addition leads to tangible value reductions. Automated processes, optimized routing, and data-driven decision-making contribute to a extra environment friendly and cost-effective provide chain, finally benefiting each logistics firms and their companions.
How do automobile producers make use of IoT to boost mobility expertise?
Rahul Mehra, co-founder of Roadcast, shared insights into the profound affect of IoT on the mobility expertise throughout his presentation on the Auto SCM Summit 2023. Introducing their IoT expertise as a “community of sensors,” Mehra detailed its operate in absorbing information from the environment and broadcasting it onto a community.
Highlighting the importance of IoT, Mehra characterised electrical automobiles as “IoT gadgets on wheels,” provided that roughly 90% of their parts are digital. Reflecting on the trade’s evolution over the previous 7-8 years, he remarked on the transition from treating IoT as a luxurious in 2015 to its present standing as a necessity in each automobile. Mehra harassed that OEMs now acknowledge IoT’s twin position in enhancing buyer expertise and elevating product high quality and repair ranges.
Discussing IoT’s essential position in insurance coverage telematics, Mehra underlined its necessity for fashions with usage-based insurance coverage, emphasising the dependence on real-time information evaluation. Illustrating with a real-life instance of battery explosions in two-wheelers, Mehra showcased IoT’s potential to proactively establish points, mitigate potential hazards and guarantee consumer security.
Decoding automotive resilience with information
Lakshya Sharma, Head of Development at GoComet, shared insights into the journey of digital transformation in logistics. Reflecting on the previous decade, Sharma famous the absence of specialized instruments for logistics, with firms typically adapting ERPs like SAP for information recording functions. “The logistics firms have been utilising their ERPs in a force-fitted approach the place their SAPs or ERPs have been tweaked with a purpose to make the use circumstances work predominantly for recording information. That is once we began our journey into digital transformation and that was our objective as we wished to construct that system,” Sharma stated.
Citing a 202 report by Gartner, Sharma highlighted the accelerated tempo of digital adoption triggered by the Covid-19 outbreak. The reactive change led to an exponential surge in digitization, with companies quickly integrating programs and visibility instruments. Nevertheless, Sharma identified that many visibility options, regardless of offering consciousness of delays, lacked resilience.
In a survey carried out by GoComet, it was revealed that “8 out of 10 visibility options have been standard monitor and hint instruments that merely knowledgeable companies about delays with out providing proactive options citing that over 57.3% of the 1.5 million containers tracked in 2023 didn’t arrive on time.”
Sharma mentioned the evolving expectations from digital programs, noting a requirement for a Observe and Hint system able to anticipating dangers in pre-approved shipments. This proactive strategy goals to raised put together companies for potential challenges within the logistics course of, shifting past mere consciousness to actionable insights.
In essence, GoComet’s give attention to digital transformation underscores the necessity for specialised options within the logistics trade. The popularity of limitations in conventional monitor and hint programs emphasizes the significance of proactive instruments that anticipate dangers and empower companies to navigate the complexities of the provision chain extra successfully.
This text was initially revealed in Indian Transport & Logistics Information’ Jan-Feb 2024 situation.
