Harnessing the Full Potential of IoT in Automotive Supply Chains

Automotive supply chains typically span multiple countries and third-party companies. It’s easy to see how tracking the movement of individual parts or shipments could become complicated. Fortunately, the IoT can make the process much more user-friendly. Tapping into the full potential of the IoT’s connectivity takes time and careful consideration. It can help people in the automotive industry avoid supply chain snags and boost their profits.

Gain Real-Time Insights About Shipments

Before IoT technologies were widely available, people often didn’t have the full picture of the events that resulted in shipments arriving damaged or getting lost on the way. However, when automotive brands use the IoT for supply chain tracing, employees can get immediate alerts if things go wrong.

For example, one startup called Tagbox offers IoT solutions that show when shock happens and what causes it. The sensors can detect whether a box got dropped, tilted or turned upside down. It can also reveal whether accidents happened because someone failed to properly secure a shipping container.

Cars contain many parts that could easily get dented or broken due to careless handling or other mishaps. However, IoT sensors provide current data to make people along the supply chain become more proactive about their shipments.

For example, the data might show that certain third-party handlers repeatedly process the shipments roughly, increasing the likelihood of damage. Such circumstances warrant in-depth conversations with the relevant suppliers and potentially informing them that they must improve to retain the business relationship.

Alternatively, the IoT sensors might reveal that a box has tipped over while in transit. When the recipient gets a real-time notification of that event, they could alert the driver or dispatcher to stop and fix the problem.

Use IoT-Based Administrative Solutions to Save Time and Improve Accuracy

Whether carrying fully assembled vehicles or parts, the people transporting products for the automotive industry must produce the necessary paperwork when arriving at weigh stations. Failing to do so could result in regulatory issues for the trucking company and delays of the transported goods. 

When one transportation company began using an in-cab tracking system for its fleet, it saved approximately $25,000 based on administrative and compliance time. The system’s sensors showed precisely where individual shipments or trucks were at any time. Dispatchers or others could see whether potential problems arose at weigh stations or anywhere else during a journey. 

Some IoT systems also have GPS and geofencing capabilities. That data could show whether certain service stations, distribution centers or other facilities along a route are frequently congested. Tracking trends that way gives decision-makers the necessary information to control what they can, which may mean routing drivers to less-crowded options. 

Leaders may invest in IoT products that have built-in weighing capabilities. That way, no surprises occur once someone reaches a station. Having that data early is a great way to decrease costs and avoid penalties. It’s also helpful if an IoT scale sends frequent data transfers to dispatchers or other administrative team members. 

Such a setup can reduce or eliminate the physical paperwork drivers must keep track of and carry. That typically increases their overall satisfaction and lets them devote more attention to staying safe on the road.

Commit to Relying on High-Quality Data

IoT sensors are fantastic for collecting large amounts of data, making feeding into an analysis platform easier. However, the IoT needs clean and correct information to provide the desired results.

Everyone involved in choosing and implementing IoT technology for an automotive company must agree on how to prepare the relevant data and inspect it for accuracy. Something as seemingly simple as having a customer or supplier’s address in two different formats could lead to a data-analysis system providing inaccurate information. 

Deciding what kind of data to collect and why is important. The results of one 2023 study showed 72% of leaders said the amount of data and their mistrust of it had stopped them from making decisions. However, a commitment to high-quality data throughout an organization can encourage deeper trust from leadership and people at all other levels of the organization. 

Similarly, if leaders at an automotive company strategically collect data for well-defined reasons, those who must use the information for decision-making should find the amount more manageable. 

In one case, an automotive parts manufacturer installed sensors on brazing oven fans. They wanted to minimize unexpected outages since it took three days to repair these components. That’s an example of why it’s wise to justify the type of data collected, along with ensuring it’s high quality. 

No company can feasibly collect all the information from each one of its operations. However, when evidence indicates the business could save money or prevent downtime by collecting a specific type of data, it’s easier to make the necessary process changes.

Deploy the IoT for Improved Locational Awareness

When a 2023 study examined how automotive companies were enhancing their global supply chains, it revealed that the IoT is still only chosen by a minority of companies. More specifically, only 32% were using sensors. However, if that technology became more common, perhaps it would solve known supply chain problems faced by automotive industry professionals.

The same study showed 36% of respondents experienced inventory shortages or found their components in the wrong places. Moreover, 53% of the automotive manufacturers had dealt with supply chain execution problems.

The IoT could help with all of these issues, notably by assisting people to find individual or boxes of parts in sprawling warehouses or other facilities. An authorized person — such as a supply chain manager — could log into an IoT platform and see the real-time locations or whatever they need to find. 

This approach is also effective for people who worry about insider thefts of in-demand or expensive auto parts. Many IoT sensors allow users to set geofencing alerts, so they’ll get immediate notifications if components get taken off the site.

The IoT Makes Automotive Supply Chains Stronger

The automotive supply chain features many variables that are outside the affected parties’ direct control. However, IoT technology can provide better visibility for everyone involved, allowing the correct individuals to intervene when necessary and keep shipments or manufacturing processes moving.