Study: Pandemic poses new challenges on automotive industry

[divider style=”solid” top=”25″ bottom=”25″][dropcap]D[/dropcap]HL Supply Chain, the contract logistics specialist within Deutsche Post DHL Group, has calibrated current findings from renowned research institutes showing how the pandemic will create or speed up some trends in the automotive industry, but stall others.

According to this new trend report “Automotive – A Shifting Landscape“, the automotive industry is facing some great changes resulting from the rise of new technologies, a shift in customer expectations and an ever-stronger focus on Environmental, Social and Governance policies (ESG). DHL Supply Chain offers solutions that will help OEMs adapt to the challenges the industry is facing and at the same time support them in meeting their corporate ESG targets.

“With borders and shops closed, last year has made the importance of flexible and reliable supply chains very clear. The industry will transit into a new normal after the pandemic, with retail models changing and automation increasing. But these are not the only challenges OEMs will face in the future. We have to acknowledge the role logistics plays when it comes to sustainability. There are already lots of possibilities to support the automotive industry towards more environmental consciousness,” says Dr Dietmar Steins, EVP Global Solutions Design at DHL Supply Chain. “We support our customers in implementing ongoing trends such as sustainability and digitalization into their supply chains.”

The study unveiled that there are several aspects which impact the automotive industry and which in addition create interdependencies on each other. Car manufacturers and their suppliers are exponentially moving towards emission-free mobility by making the transition to electrification, while COVID-19 is shaping future swings and distorting past predictions. As OEMs are affected by fixed costs with little or no revenue, investments in future trends such as self-driving cars have been trimmed or refocused.

Online sales, once claimed to never replace the dealership experience, may be getting a second wind. Projects and capital expenditures that are not contributing to the immediate bottom line have been delayed. On a broader level, some of the industry’s deepest-held beliefs about globalization and supply chains are being put under pressure by the pandemic.

According to researchers, independent regional strategies will gain more importance in the automotive industry. With countries in lockdown and manufactures closed, localization or at least flexibilization of supply chains are key for the resilience of the sector.

Studies also show that the industry is far from the end of digitalization. With the rise of automation and connectivity, the industry is heavily investing in artificial intelligence and machine learning. In the age of data supremacy, OEMs are further migrating to a more service- and customer-oriented model leading to changing retail models.

In order to make the industry more sustainable holistically and to comply with corresponding policies, the supply chain must also be taken into account. Sustainable solutions are required to get us on the way to greener mobility.

“Thanks to our longstanding expertise in handling complex supply chains, we can recognize changes in the industry at an early stage and adapt to them. With our sustainable warehouse, transport, and packaging solutions, we offer OEMs the support they need to achieve their ESG targets.

The move to e-commerce or direct-to-consumer sales is also facilitated through the Digital Freight Platform and other digital retail solutions we offer. We are very proud to be able to provide the automotive industry the support it needs” says Hendrik Venter, CEO DHL Supply Chain EMEA.

Logistics service providers act as an extended arm to the customer. Therefore, a reliable partner with an extensive network is essential when setting up individualized supply chains. From supply chain design to digital retail and aftermarket to solutions for e-vehicles or sustainable logistics, DHL Supply Chain can help with customized solutions.

For example, setting up flexible and decentralized supply chains to enable faster delivery to customers via e-commerce. But also adapt logistics to changing requirements which go hand in hand with, for example, e-mobility. To decrease the carbon footprint, the logistics expert provides emission-saving transport or value-added services such as upcycling spare parts in the circular economy.

This way, DHL Supply Chain supports OEMs to adapt to future challenges to meet their corporate ESG targets.

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