Small And Medium-sized Parts Makers' Profits Under Pressure, Digitalisation Of Automotive Manufacturing Industry Looking For New Ideas

Sep 19, 2024

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Is the digitalisation of the automotive industry a false proposition under the fierce market price war?

At the WOD Automotive Manufacturing Digital Transformation Summit held in Shanghai, many automotive supply chain professionals told reporters that the general trend of digitalisation in the automotive industry is still in place, but under the background of strong competition in the market, the digital transformation will probably be 'small' and 'rolling'. Digitalisation is a major trend in the development of the automotive industry.

Digitisation is a megatrend in the development of the automotive industry. At the same time released at the meeting of the '2024 China Automotive Manufacturing Digitisation Market Research Report' shows that, compared with other manufacturing industries, the degree of digitisation of the automotive manufacturing industry has been relatively high, the market size of more than 130 billion yuan, the next five years the annual growth rate will be up to 12.8%, to 2030 will be more than 300 billion yuan. Among them, the high degree of digitisation of large automotive manufacturing enterprises has boosted the digital transformation of the automotive industry cluster and the upstream and downstream of the supply chain.

The weakness of the current digital transformation of the automotive manufacturing industry lies in the collaborative transformation of the upstream and downstream of the supply chain. The report analyses that the current degree of digitization of small and medium-sized auto parts manufacturers is still relatively low, far from meeting the requirements of the modern automotive manufacturing industry in terms of production efficiency, supply chain management, product innovation and market response. Influenced by the future demand for supply chain integration, the digital transformation of SMEs will usher in a larger market.

SMEs themselves are not without digital transformation needs. Lei Xiumei, chief research officer of the Digital Economy Research Institute, said that the importance and urgency of digital transformation is self-evident in the current automotive industry, where companies strive to reduce costs and increase efficiency. However, the top-level design, system isolation and data fragmentation, lack of talent and R & D production data confidentiality and other issues, so that the road of digital transformation of automotive enterprises is full of challenges. At the same time, small and medium-sized parts manufacturers are more sensitive to cost pressures, and in the context of the current supply chain profit compression, small and medium-sized enterprises are not sufficiently motivated by digitalisation.

Some participating experts believe that 'small' 'rolling' digital update for small and medium-sized auto parts manufacturers is more practical. For example, Zhang Hao, chairman of the Shanghai Artificial Intelligence Society, said that compared with high-volume and high-cost automation equipment upgrades, the integration of human-machine collaboration is more representative of the current direction of development of intelligent manufacturing. 'In industries such as machining and assembly and assembly, human intervention has an advantage in terms of comprehensive cost. The key to human-machine integration is not to replace people, but to maximise human capabilities through the cooperation of automation equipment.'

'The effect of digital transformation is not immediate and requires a spirit of long-termism from enterprises.' Zhang Shuqiao, a member of the Digital and Intelligent Manufacturing Working Committee of the Chinese Society of Automotive Engineering, said that the effect of digitisation of a single enterprise may be limited by the level of digital collaboration in the supply chain as a whole, so it is more practical for small and medium-sized enterprises to push forward the digital update in moderation according to their own situation.

Lei Xiumei said that with the increasing degree of digitisation in the automotive industry, simulation, machine vision, artificial intelligence and other technologies in the automotive industry will be further applied, the integration of production, supply and marketing, supply chain integration, quality of the whole life cycle management will be the key direction of the development of the automotive industry.

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