Electric Vehicles (EV) production has grown but accessing raw materials has become a challenge.
The last 40 years have delivered incredible progress in the automotive industry. However, natural disasters, trade wars, and a global pandemic have greatly impacted the supply chain as a whole.
The time for electric vehicles (EVs) is now, and the rate of growth during this decade is exponential. It’s an interesting time for suppliers but, with it, comes challenges and the need for innovative thinking and action to meet such demand. We will also discuss steps OEMs can take to dominate the EV supply and value chain. We also did a webinar on this topic and you can watch it at Blueprint to Dominating The EV Market”.
There are currently 163 EV manufacturers in the US alone. But suppliers face halting bottlenecks with supplier management challenges due to rising demand and the shift in how the global supply chain has responded to the pandemic. Post-COVID changes have suppliers looking to mitigate risk, but raw materials are acquired from high-risk, geo-politically challenged areas and come with long lead times.
Industry experts also know the lack of charging locations does not compare to the surplus of gas stations nationwide. Such a hurdle means finding ways to offer more accessible charging stations so that EVs can compete.
Aside from the complex powertrain components, there are additional costs associated with EVs. Expensive battery and electrical components within the supply chain are putting pressure on manufacturers to come up with new technologies that will be the differentiator amongst competitors.
Suppliers need to be nimble, transparent, and collaborative to overcome these challenges. Market intel, order management, and visibility are needed to win and sustain customers and investors. The demand for a complete, digitized process is needed to go from order to manufacturer to distribution as the market moves to a direct buy model. Because of a 45% CAGR in services and parts for EV, predictive analytics for ordering parts and scheduling service will become critical.
Integrating the entire supply network and mapping supply risk, especially for critical suppliers and parts, is important to build a single source of truth. Taking the lack of visibility into siloed networks and connecting them leads to more effective analytics – providing the right insights to the right players in the entire value chain.
Recently, we implemented our Supply Chain Control Tower for large OEMs and their visibility into their supply chain went from less than a week to 16+ weeks.Tada guided them with implementation and change management to provide that visibility into their supply mapping and help them become a fully functional collaboration platform in just 40 days. You can watch more details in the webinar or learn about how we facilitate multi-tier supplier collaboration.
Aftermarket, or aftersale parts and service support, is significant because of its ability to look at data around failure predictions, part lifecycle, and knowing when something will need service. A multi-tier approach connects the data from the vehicle to understand the predictors for parts and service so the customer has minimal disruption.
While there are still gaps in the marketplace, having that market intel with more alignment shows the power of connected assets for predictive analytics, ML/AI for parts, service and inventory planning.
Supplier communication across the entire value chain is critical to have an efficient, effective, risk mitigated supply chain in a decade where growing customer demand is much higher than the supply. Having a digitally enabled system that's integrated lets you make smart decisions, execute programs, foresee risks and manage operations effectively so you can better support the customer.