Creating value for the Automotive industry
Navigate disruptions through agile supply chain solutions.
Our specialised automotive services
The automotive industry is a complex web of supplier and Original Equipment Manufacturers (OEM) relationships. Each layer in this industry has a specific set of requirements for their supply chain.
Our suite of services makes sure that the automotive community finds synergy right from manufacturing to sales, and long after that. An OEM collaborates with the Component and Tire Manufacturers to complete the offering. The Aftermarket Suppliers continue the experience through their products.
Original Equipment Manufacturer (OEM)
OEMs are the companies that build automobiles, motorcycles, buses and more. They source parts from their main global suppliers and assemble them closer to the markets of sale. Their supply chains are characterised as complex, global and with just-in-time or just-in-sequence delivery.
As inventory levels for cars can be extremely expensive, auto supply chains run in a hybrid, lean and agile way, minimising stock levels through just-in-time and just-in-sequence manufacturing and moving the decoupling point as close to the point of sale as possible.
The lean methodology is leveraged by using many common parts across the models, while agile is leveraged by adding customer-specific elements close to the point of sale – once the orders are received. OEMs also control finished vehicles. Although controlled by the OEMs, they have separate requirements like racks, transportation and so forth.
Component Manufacturers manufacture and supply components to the OEMs and are classified as either Tier 1 and Tier 2. Supply chains of Tier 1 manufacturers are usually closely interlinked with the OEMs and are either co-located or placed very close to the location of final assembly.
Proximity is key for this to be successful, and usually results in push-type supply chains. As these companies mainly focus on the production of components, we see the outsourcing of logistics services to 3PLs, etc.
Tire Suppliers manufacture components for the OEMs and have their own retail/distribution channels. They have a supply chain ranging from raw rubber in Indonesia to delivery of large mining tires in Australia. For OEMs, they supply tires for assembly of cars, resembling a just-in-time supply chain. On the retail side, they use networks of wholesalers and distributors for sale in the market. OEM and retail tires have a push-supply chain behaviour, where the tire manufacturers store stocks either in transit or in the destination markets. Mining tires, on the other hand, operate as a full-service aftermarket contract.
Aftermarket Suppliers make parts for the post-sale applications and operate supply chains closer to the retail establishments, where demand forecasts drive a push-supply chain to stock. They tend to stock a wide variety and purchase from multiple manufacturers, both OEM and non-OEMs, at a global level.
Key enablers which we build your supply chain solutions around
From sourcing to the last-mile delivery, get industry-leading reliability for a just-in-time supply chain.
How Maersk Supply Chain Management creates value for the automotive industry
The latest market trends and global trade policy changes have impacted the entire automotive industry. Shared mobility, autonomous and hybrid vehicles, and a reduction in carbon emissions have become important topics. For instance, the growth in the demand for electric cars has increased the overall demand for batteries but the global decline in auto sales has distressed the related industries.
Careful analysis of these trends will pave the way for more accurate demand and supply predictions and future planning. Given all this information, cutting-edge supply chain processes are the most logical next steps.
We can drive the momentum together
The reorganisation of the automotive sector is almost inevitable. To adjust to these changes, manufacturers will have to find new ways of reducing redundancies.
Maersk Supply Chain Management solutions have been helping companies achieve all this and much more through agile, scalable and sustainable processes and a global network of products and experts. This is why an increasing number of companies are selecting us as their logistics partner.