Automotive Supply Chain Evaluation with Conventional Model and Integrated Model

ABSTRACT: Increasing competition due to market globalization, product diversity and technological breakthroughs stimulates independent automotive companies to collaborate in a supply chain that allows them to gain mutual benefits. Especially the events of the past years have shell-shocked even the most ardent industry participants – a crisis and the following hard recovery. Not only the critical challenges in implementing process lean with low cost and high quality, also critical to success is the ability to efficiently meet stricter emissions and fuel economy standards escalating in most jurisdictions. With all the factors working beneath the waves, supply chain management becomes the core source of a company’s competitive advantages and even the trump of the entire automotive industry’s success. A proper supply chain strategy provides financial returns and other key factors superior to the old concepts which brought profits before but no longer up to date now. Correctly design and effectively evaluate the supply chains, and improve the supply chain structure dynamically over time, are the key methods for an automotive company to survive and succeed in the volatile and critical automobile industrial environment. In this research work, based on the real case study in the automotive door system supply, different supply chain scenarios are designed and corresponding performance evaluations are made by applying different methods, namely the conventional model and the integrated model with their corresponding algorithms. With conventional model, the evaluation is done from different aspects, where the chosen perspectives such as costs, flexibility, stability, and reliability are assessed respectively for the multi-stage international supply chains. The data applied in this model comes from real-case door module supply, and the evaluation results helps in the decision making in localization process of that certain project. To be able to evaluate more complicated supply chain scenarios in a more accurate and efficient way, an integrated model is designed for the comprehensive performance evaluation. Based on the fuzzy theory, a MDFIE (Multilevel Dynamic Fuzzy Integrated Evaluation) algorithm is developed to assess the automotive supply chain performance. With the real case of vehicle door system supply, a detailed index system is designed based on a profound understanding of the automotive door supply chain. And with this new method, supply chain scenarios with different outsource degree and integration degree are evaluated and analyzed, a positive solution of deeper integration and downstream task shifting in the automotive supply structure is concluded in the end. In addition to the use in this research work, the integrated model, especially the index system can be flexibly adjusted for other automotive supply chains under their special interest and requirements. And with the MDFIE algorithm or other possible methods, the model can also be further developed into user-friendly software or system for the normal application. This software development is suggested for the further research. Based on the researches done in this work, a new tier structure is proposed as well. A mega system supplier which is defined as the new Tier 0,5 and other outsourced service companies which are playing as the half tiers (tier 1,5/ 2,5…) are discussed in this work. With all the theoretical researches and practical investigations, this new structure which occupies the niche positions of supply chain is supposed to be benefiting the entire automotive supply chain in many critical aspects, like the long lasting over capacity problem and the coming E-mobility trend. Some other suggestions like the application of RFID technology are also proposed for increasing the productivity and strengthen the information flow along supply chain. In general, improving the entire automotive supply chain performance, is the ultimate goal of supply chain management, which means balancing all participators’ maximum profits and offering the highest market service level. The realization of the proposals and concepts, is also supposed to be studied in the further research.