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Jan 11 2012

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From the Detroit Auto Show: What’s Next for the Industry in 2012?

It’s a new year, and once again thousands of journalists, industry pros and curious consumers have been descending on Detroit for the North American International Auto Show, to see what’s coming next in the automotive world.

This show has been an annual fixture of the industry for more than a century. It’s a good sign that the industry, and this region in particular, are healthy enough that the show continues to attract so much excitement and attention. But if you look more closely, you can see seismic changes underway in the industry. I’m not talking about the latest compacts and alternate fuel types, or the newest concept cars. I’m talking about something taking place on the other side of the world: the New Delhi Auto Show, running at about the same time in India.

Still a 2nd tier event, the New Delhi show is starting to gain international prominence. So much so, that Jaguar – Range Rover actually skipped Detroit this year, in order to focus on the show in India. That’s pretty remarkable, yet not so surprising when you think about it. Just as China before it, India is awakening as an industrial power – and a major market for automobiles. A decade ago, the really major auto shows were in Detroit, Geneva, Paris, Tokyo and Frankfurt. Today we have to add Shanghai, New Delhi and Los Angeles to the list. This transformation is about more than conventions and glitzy shows. This is about how cars are made. The shows are simply following the markets. In today’s global marketplace, it makes sense more than ever to manufacture locally as much as possible. So the auto makers are opening plants in India and elsewhere, and their top suppliers are following suit.

You don’t need a crystal ball to see where this is going. Not all Tier 2 and 3 suppliers can afford to open everywhere, and neither can their vendors, so extended supply chains are being pulled and stretched in more directions than ever before. Of course, the wider the area that a supply chain must cover, the more fragile the entire chain becomes, and it only takes one weak link to break the whole thing, local or not, as we all learned from the natural disasters that struck in 2011.

So here are my predictions for 2012. The industry will be hit by another supply and sourcing problem because, well, something is bound to go wrong somewhere. As a result, more automotive manufacturers and their suppliers will finally decide to modernize and standardize their manufacturing execution systems to deal with the realities and unpredictability of a global industry. After all, if it makes sense to build cars on a common platform, doesn’t it make just as much sense to use a common IT platform to manage the whole process?

In fact, I would argue that the logic is even more compelling in the case of a platform for manufacturing operations management. Why? Because you can bet next year’s car model that India won’t be the last major new market to arise, and the supply chain challenges are only going to intensify. That’s one prediction you can drive to the bank.

By the way, congratulations to Range Rover for winning North America Truck of the Year with the new Range Rover Evoque at the NAIAS show in Detroit this past Monday. If you’d like to see it, you’ll have to go to the Motor Show in New Dehli. You can’t see it at the show in Detroit.

See you at next year’s auto show…somewhere in the world.

Permanent link to this article: http://www.apriso.com/blog/2012/01/from-the-detroit-auto-show-whats-next-for-the-industry-in-2012/

2 comments

  1. VW Dealer Albuquerque

    I do believe all the ideas you have presented in your post. They’re very convincing and can definitely work. Still, the posts are very brief for newbies. Could you please extend them a bit from subsequent time? Thanks for the post.

    1. Gordon Benzie

      Thanks for the feedback. We try to strike a balance in our posts to be long enough to convey a message yet short enough to be easily read.

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