RFID in the Automotive Supply Chain

Competitiveness in the automotive industry has increased significantly, requiring all players in the value chain to drive continuously for operational efficiencies.

Radio Frequency Identification (RFID) is a technology that could enable such efficiencies through automation of data collection which is faster and reduces manual errors. It has been around for many years, but with recent advancements has become more realistic in terms of operability and price for large scale use in industry.

Two types of RFID exist in vehicle logistics today:

Real Time Locating Systems (RTLS) can identify the actual location of a vehicle in a storage yard to within a few meters. They provide benefits in productivity, data accuracy and the associated reduced damage and increased customer satisfaction.

“Checkpoint” Systems provide visibility in a supply chain by identifying when a vehicle has passed through a particular ‘gate’. This would typically be the arrival/departure gate of a storage yard, but could equally be a ‘gate’ within the yard where a certain procedure is carried out.

The RFID Working Group has met periodically to review and understand the various possible uses in the supply chain. They also have looked at the possibilities of combining the various projects outlined below to create a single end-to-end RFID solution:

Ford Europe implemented RFID technology at its plant in Cologne to monitor and steer all vehicle movements from when the cars roll off the assembly line “end of line” to leaving the plant, as well as to manage vehicle inventory.

SEAT in Spain tested and proved the technical capable of being able to read vehicles passing on a car transporter at 30 km/h with up to 99,8% of reliability. A business case has also been completed and SEAT expect to roll out this technology before the end of 2009.

ECG member, Broekman Automotive in The Netherlands deployed RTLS solution for tracking and locating up to 35 000 cars at its location.

Manufacturers have expressed an interest in the idea, however, using the RFID tag throughout the whole supply chain would require a significant investment in the technology by transport and terminal operators, who, for the time being are unable to invest due to the high cost requirements. On the other hand if one RFID tag could be used throughout the entire chain then different parties in this chain could share the cost. The Working Group would like to analyse a business case and create a pilot of a project involving a car equipped with RFID tag being tracked from the production plant to the dealer.

However in order to carry out such a pilot funding is required and continues to look for European sources to enable a full feasibility study.