E-volution

As the movement to improve various supply-chain functions through the implementation of e-business initiatives gains momentum, the providers of the products and services that make the benefits possible are becoming more important to the automotive industry's future.

Recent trends in the automotive industry, along with ever-present industry goals of cost reductions and faster product-development times, among others, call for increased coordination along the entire supply chain. For example, outsourcing and modularization require “unprecedented collaboration between the OEM, the supplier providing the module, and the suppliers from which the module is sourced,” according to a recent study (see sidebar). Out of these imperatives, a plethora of companies have sprung up to supply automotive OEMs and suppliers with e-business products and services. It may be difficult to keep up with all the e-businesses and products out there today, but two names have become familiar in the burgeoning market: FreeMarkets and Covisint.

In on the ground floor of the e-business era, Pittsburgh-based FreeMarkets, Inc. is a “global sourcing market” and a provider of e-sourcing software and services for numerous industries, including automotive. Established in 1995, the company has structured and conducted over 14,500 online markets for more than $21 billion worth of goods and services and has helped its 120+ customers save about $4.2 billion. In addition, some 14,000 suppliers from more than 70 countries have competed for business from customers such as Dana, Eaton, Valeo, and Visteon.