The automotive industry has been using EDI for decades. But only in 1996 did the Automotive Industry Action Group (AIAG) make it a requirement for OEMs and their Tier 1 suppliers in the U.S., with common guidelines.
Because the automotive industry is also a global one, it is even more important that automotive manufacturers are able to communicate effectively and efficiently with all of their suppliers, wherever they are. Those suppliers, in turn, are at a disadvantage if they cannot also utilize EDI with their suppliers. With the variety of communications and document standards utilized, and a number of automotive industry associations, VANs and other regional networks in place across the world, managing an EDI operation can be a challenge for automotive manufacturers.
The Complexity of EDI Compliance for Automotive Suppliers
For the automotive industry, EDI initiatives must address the complexity inherent in such a large, global network. Manufacturers typically have facilities throughout the world, especially in lower-cost countries such as China and India. In these cases, Tier 1 and 2 suppliers, and their suppliers, may have local operations to support their customers.
Adding to the complexity is the variety of protocols, standards and other EDI-related entities at play:
- The automotive industry uses a number of communications methods, including HTTP and FTP, while OFTP (now OFTP2) is common in Europe
- More and more manufacturers are adopting the use of XML in lieu of traditional EDI formatting, particularly for catalogs and retail information.
- ANSI X12 and EDIFACT are the primary EDI document standards used in automotive, but regional standards are also common, such as VDA, or variations on X12 or EDIFACT.
- Different automotive industry associations are at work providing automotive-specific EDI standards in different parts of the world, such as the AIAG in the United States, Odette serving the European automotive industry, and the Japanese Automotive Manufacturers Association (JAMA).
- The automotive industry is served by numerous regional, private networks, in addition to traditional VAN providers, such as the American Network eXChange (ANX), European Network eXchange (ENX) and Japanese Network eXchange (JNX).
Automotive manufacturers everywhere continue to place additional requirements on their suppliers within this complex framework, especially with the expectations of “just-in-time” delivery. This makes it essential that automotive suppliers implement EDI solutions that are flexible, responding to trading partner demands quickly and accurately.
Automotive EDI solutions must also be able to address common automotive manufacturer needs, such as:
- Release processing, including cumulative quantities (CUMs) tracking and Release Authorization Number (RAN) management
- Barcode labeling and scanning
- Use of lot codes and label serial numbers
- Retail – lower prices through streamlined processes.
- Forecast and sales order replacement logic
- Advance Ship Notices (ASNs)
Of course, an effective EDI operation can benefit the automotive manufacturer with streamlined operations, shorter lead times, more inventory turns, a reduction of data entry errors and associated costs, improved scheduling and increased productivity.
1EDISource Can Help
1EDISource can provide OEMs and Tier 1 suppliers with highly effective EDI solutions that accommodate the wide range of standards, requirements and EDI-related tasks of the automotive industry. Our advanced EDI software, EDI/HQ™, is a world-class EDI solution for manufacturers who want complete control over their EDI operations. You get powerful, easy-to-use and automated tools for managing every aspect of the automotive workflow, such as purchase orders, releases and shipping schedules, ASNs and more, for your assembly plants, parts divisions, dealer operations, various suppliers and more.
Alternatively, you may prefer to let the experts at 1EDISource manage your entire EDI operation, with an EDI Outsourcing solution. You get complete and accurate EDI communications, integration and tracking capabilities, without the investment in software, hardware and other resources.
Talk to one of our EDI Experts to learn how 1EDISource can help you implement an effective EDI solution for your automotive manufacturing operation.
Need to get more of your suppliers onboard to optimize your EDI operation? EDI SmartXchange for Suppliers from 1EDISource is a complete web-based EDI portal to allow more of your supply chain to be EDI compliant. You get better EDI performance, your suppliers get a simple, affordable EDI tool.