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Automotive supply chain must collaborate, innovate: Study

Accelerating collaboration, innovation in managing costs, developing capabilities to capture after-market opportunities and developing tailored value chains for exports are some ways players in the automotive supply chain must take to meet future scenario, states a research study.

The study "Building World-Class Automotive Supply Chains in India", jointly done by Confederation of Indian Industry (CII) and consultancy firm AT Kearney, was released in Chennai on Thursday.

The research has identified that one of the challenges is to build a supply chain that is prepared to manage long-term growth, as well as flexible/responsive enough to handle short-term volatility.

Citing industry executives, the study says automotive supply chain has an important role to play as it is a source of competitive advantage.

According to the study, some of the issues that would affect the automotive supply chain segment in India are the long term secular growth and volatility; escalating supply chain costs; increased products; export growth; fast growing after market; shortage of talent pool and others.

To manage the above complexities, the study has suggested that the players should accelerate collaboration across the value chain like supply planning; innovation in cost management like sharing of risks; integrate internal supply chain to external network so as to take advantage of the export potential.

The study predicts automobile and component makers with proprietary technology to play a significant role in the after market. Hence they have to develop shared goals and objectives to enhance the performance of after market supply chain, it said.