In June, business leaders from within the automotive supply chain met in Detroit for the 2019 AIAG Supply Chain Summit.
CDN’s Derric Hicks attended the conference to learn more about the standardization efforts that are taking place within the industry. To date, the automotive supply chain sector remains fragmented and compartmentalized and there has been little to no success in implementing standards across the various fragmented channels and sectors of the automotive supply chain.
In addition to some great networking opportunities, Hicks also came away from the conference realizing the AIAG is hyper-aware and focused at changing this. However, he also concluded the AIAG’s main issue is not necessarily the willingness to work for change, but the ability of the group to keep up with technology and resisting trying to change too much. Technology is changing so quickly within the industry that today’s ideas are being outdated before the group can react. The main inefficiencies which create the most issues for the industry are:
- Inaccurate forecasts
- Dealerships restricting days and times vehicles can be delivered
- Overcrowding at dealership lot
- Reduced capacity in railcar and road haul-away
- Increased admin costs
- Delayed delivery times to dealerships
- Insufficient communication regarding vehicle statuses
- Lack of transparency throughout the supply-chain
The AIAG group is seeking for the one thing that will most effectively reduce inefficiency and provide positives for all parties. They feel a standard to communication and provide transparency along the entire supply-chain would be a great place to start.