The Impact of Advanced Analytical Technologies in Automotive Sector


Harish Thyagarajan

17 Jan 2018

The Impact of Advanced Analytics in the Automotive Industry

Almost every industry of the current era is being impacted by advanced analytics, and the automobile sector is no exception. All business activities are now becoming highly data-driven, and this is where analytics enters. All the businesses such as manufacturing, healthcare, automotive and education are all collecting personal information about their target consumers in order to have an actionable consumer insight.


In India, the real-time connectivity may still be a challenge, as there are frequent power cuts and limited broadband reach. There is also a challenge in acquiring talent in data analytics, this is the primary challenge for any sector. A company’s success will depend on finding such talent. Take, for instance, the automotive industry, the bill of materials for the assembly of vehicles is of utmost importance to the business operations. On an average, a vehicle will have 25k or more components and base parts. If we take a look at it from the data perspective, these relationships are hierarchical in nature and can be extremely complex to represent with accuracy. The level of complexity increases when there are reusable parts across various vehicle models and multiple combinations of the same. Without analytics, the task of understanding data in a useful manner is next to impossible.


Analytics helps in converting the consumer data into a corporate asset. With this, companies can easily determine the consumer preferences and automobile usage data for increasing customer acquisition as well as retention. It can also help the industry in gaining the design efficiencies, procurement and also help in effective supply chain management. With advanced analytics in place, companies can tweak the production lines to attain continuous improvements.


For instance, each component of an automobile can be neatly designed for improved performance and looks respectively. One can also have a detailed model-specific performance report using the actual data that is collected on driving safety, engine performance, comfort and servicing history. This immensely helps the vehicle manufacturers by providing a  real-world data for improving the designing of newer models.


On the Shop Floor

The performance analysis conducted with the help of various analytical tools help the automotive manufacturers with some useful insights that they otherwise would have no access to. At the shop floor level, analytics can help in improving the equipment utilization and make it available across the enterprise and assist in optimizing the factory capacity. Each and every process can be fine-tuned for maximizing the output and averting failures. This can help in effective inventory management as well as supply planning.


Impact of Modern Technologies

Extensive adoption of sensors and telematics is now prevalent in the consumer vehicles. This clearly conveys that the automotive manufacturers need expertise in various kinds of activities, which finally result in the production of an automobile; without advanced analytics report, getting a clear insight would be impossible.


Ford motors came up with a brilliant idea of integrating the vehicle purchasing data and the real-time vehicle plant data to build a vehicle level view of profitability, which incorporates the effect of both raw materials as well as the non-standard incremental features for every stock keeping unit. Ford generates the vehicle profitability details and then delivers it to the stakeholders as and when required.


Globalization may create loads of information that limits productivity, however, Big data can bring these together effectively. With standardization on the rise and an increase in the use of sensors to measure and rectify numerous functions, the ability of the automotive manufacturers in optimising the efficiencies at each stage, starting from implementing the regulatory compliance to selling and servicing the vehicles is being impacted by advanced analytics.

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