Traditional auto parts companies are now going through a new transition phase. This is because with the advent of electric vehicles, the utility of old mechanical parts is decreasing. At the same time, digitization has redefined both manufacturing and customer experience.
These are the two big forces namely, electrification and digitalization, that are adding new dimensions to the auto parts industry. In today’s auto part industry, competition is no longer just about cost or volume, but also technology adoption. All companies need to adopt smart solutions along with traditional manufacturing to stay in the race and ensure business expansion and profit.
To ensure modern auto companies meet all of the following aspects to stay in the race, electrification and digitalization are nothing but essential.
Change in the Role of Auto Parts in the EV Era
In the recent years, there is a notable decrease in demand for engine-based parts. On the flip side however, there is a rising demand for batteries, control modules, and thermal management systems.
In addition, there is a growing need for specialized brakes, suspension, and wiring for electric vehicles. These specific changes in the composition of parts in the transition from ICE vehicles to EVs has increased the need for non-contact sensors and advanced electronics. As a result, the companies turn to new designs and supply chains.
The growing demand for EV components along with declining demand for petrol-diesel based parts like clutch, exhaust and others have promoted the production of advanced battery packs, electronic controllers and thermal units. This enables to meet the rising demand for these advanced automobile components.
The market trend displays an increasing in demand for sensor-based smart parts and high-voltage connectors along with light-weight materials to ensure higher performance and mileage. As a consequence, there is a strong collaborating trend among OEMs and EV startups. Such alliance is paving the path for Drive-by-wire and ADAS compatible parts to be used extensively
in the future vehicles.
Digitalization is Changing Manufacturing Process
Sophisticated machines are used today for communicating with each other under Industry 4.0 trend. There is a rise in adoption and use of automation and robotics in inventory and assembly, which is further facilitated due to the real-time data from IoT (Internet of Things).
Companies today are using digital twin technology to provide fault detection and preventive maintenance. This ensures a smooth production flow and easy monitoring to provide MES (Manufacturing Execution System). Additionally, it helps in reducing waste and downtime to make operations lean. For the best results, companies are focusing more on digital manufacturing setup with extensive use of AI and plant level IoT. This further promotes predictive maintenance thereby reducing downtime even more.
Robots and automated lines have now become common in production units. This ensures transparency in process and easy prototyping using digital twin technology. Advanced technology ad digitalization also promotes remote quality checks and analytics dashboards, which further ensures uninterrupted production.
Evolution of Smart Supply Chain
Digitalization promotes the evolution of smart supply chains based on blockchain that facilitates traceability and smart warehousing solutions such as RFID or GPS. Companies today use advanced AI models for demand forecast and vendor platforms use digital scorecards. Such advanced
technologies promote real-time tracking and delay prediction.
Supply chain management and product tracking today have become smarter with the use of inventory optimization tools. This promotes on-time delivery and provides digital logistics in real time. Faster and more precise inventory management allows for providing demand prediction algorithms.
Also, warehouse automation saves space and manpower along with real-time data sharing between suppliers and distributors to provide API integration. All these increases overall efficiency of reverse logistics.
Digitalization of Customer Interface and Sales
Digitalization helps in ordering parts. It is now easier with the use of B2B sales portals and mobile apps. Buyers can see more immersive product demos provided by AR/VR technology. Advanced technologies also support providing help via chatbots and voice assistants, offers online access to
diagnostic tools, online pricing and customization engines.
Companies can now make targeted sales based on CRM and customer data analytics due to rapid digitization in sales & service. There are dedicated mobile apps and relevant portals that provide quick technical help via chatbots.
In addition, digitalization allows companies for customer profiling using CRM tools to analyse buying trends and behaviour of clients. Apart from that, it offers online 3D view and fit-check tools, AR- based servicing guide, and subscription model-based part delivery.
Role of Data and Cybersecurity
Advanced technologies and digitalization ensure secure access to OEM and aftermarket data and allows for data storage in different cloud-based platforms. End-to-end encryption of data stored in these servers prevent chances of cyberattacks and offers failsafe protection of sensitive design files.
It further helps in audit logs and access management, partner verification process in the supply chain, data control and security. Users can access different monitoring tools as well check and verify their assets stored in the cloud. Technology limits access to vendor and partner data and even perform cyber audits on regular basis. Furthermore, factory level firewalls and endpoint protection offer complete peace of mind.
Employee and Skill Transformation
Employees of these companies must be aware of and well-trained to cope up with the digital transformation phase in the auto industry. They need to receive training from traditional manufacturing to digital tools, be familiar with remote control with training via AR/VR and digital SOPs and machine instruction.
Sophisticated technologies are used to allow for AI-based KPI tracking, design and manage multiskilled workforce models, and specific HR policies that are adaptive to changing technologies. Ideally, the workforce needs to stay digital and aware of different AR/VR tools, diagnostics tools, SOP
display and more so that they can perform hybrid roles that involve both mechanical and technological skills.
Companies ensure this by offering digital literacy programs for technicians, mobile-based shift management, and data analytics that remains an essential skill for engineers.
Alignment with Environment and Sustainability
Digitalization and technological development allow for designing energy-efficient auto parts, digitally measurable carbon footprint reports, and data-driven environmental certification. They also promote recycling and re-manufacturing planning, traceability of green materials, and energy-
consumption monitoring through specific tools.
There are different dedicated tools to maintain sustainability and energy efficiency. These smart devices track and perform digital audit of carbon footprint, usage of raw materials, waste management plans and analytics.
Companies today can use ESG reporting automation and green logistics data systems along with AI- based emission control solutions that further promotes their sustainability drives.
Benefits of Business Report
To understand how modern auto companies are using electrification and digitalization for their business benefits, you will first need to understand the auto industry market. A detailed report on the auto parts industry by Vynz Research will be of great help in this matter since it is data-driven and
focused on specific aspects that will help companies identify technology-based opportunities.
Typically, a global auto parts market report will provide business marketers and CEOs with valuable analysis and insights into micro-segmentation, manufacturing patterns, and EV-driven demand. It will provide them clarity on strategic investments and resource allocation and create an opportunity
for market expansion. Business growth will be ensured via trend comparison of major players and close competitors.
It will offer a well-structured outlook of the market so that CEOs and CMOs have a clear picture of the promising areas to invest in. They will understand the automation scope, evaluate EV trends and assess risks and competitor analysis to gain advantage of the current market condition.
Real-time insights will improve planning and forecasting and help in understanding regional demand variations.
Conclusion
To wrap up, electrification and digitalization in the auto parts industry are not just trends but necessities. Companies that adopt this change quickly and strategically are the ones that will be sustainable and profitable by making timely data-supported decisions. Digital transformation, in other words will secure their future making them EV ready and aware of digital tools that are
necessary to adopt to move ahead in the competitive industry.
The future of the auto parts industry is smart and control over it will be achieved only when the
strategy is data driven.
