The Automotive Industry
EDI has been in use across the automotive industry for over 40 years. The smooth running of today’s car production lines relies on the seamless exchange of business documents between the car manufacturers and their supply chain.
Many of the business processes used in the manufacturing of today’s cars were developed from a production system devised by Toyota in Japan. Best practices such as Just-In-Time (JIT) and Lean Manufacturing were developed around the ‘Toyota Production System.’ JIT and Lean Manufacturing processes are central to the smooth running of many production lines around the world and EDI provides a fast and efficient way to transfer business documents in order to support these types of manufacturing processes. Providing visibility of inventory levels and notification of when shipments are due to arrive at the production line are critical to making JIT and Lean manufacturing processes a success.
The global nature of the automotive industry means that it is important for car manufacturers to be able to onboard their suppliers as quickly as possible, no matter where they may be based around the World. Many car manufacturers have established a manufacturing presence in Eastern Europe, Brazil and China, for example. It is important to ensure that suppliers located in these regions are able to exchange EDI documents as smoothly as possible. ICT skills across low-cost or emerging markets are traditionally very scarce. Therefore, the car manufacturers must ensure that they can provide simple-to-use EDI tools that enable even the smallest suppliers to trade electronically.
Due to the global nature of the automotive industry, there are numerous communications and document standards in use today, along with a number of regional EDI networks. The structure of the automotive supply chain and a description of the communication protocols and document standards used are described below.
