Seamless supply chain traceability is made possible only when partners come together to share data, writes Nadine Kanja
To stay competitive, collaboration is essential. Three years ago, major European automakers and suppliers embraced this concept. With a €110m (US$120m) investment from the German government, companies such as BMW, Mercedes-Benz, Volkswagen, T-Systems, Bosch, Siemens, ZF Friedrichshafen, SAP and others came together to launch Catena-X. The goal was to create an open and collaborative data ecosystem to enable end-to-end transparency and unlock value in diverse ways.
The ambition behind Catena-X was to create the first-ever uniform standards for the secure, sovereign and trustworthy data exchange between car manufacturers, suppliers, dealers and equipment providers. Basing it on the European cloud data infrastructure Gaia-X meant that participants would have full control over their own data and could adjust who sees what and when as they pleased.
It’s much more than idea now. Catena-X is live and has grown to nearly 200 members and counting, from corporate giants on down to SMEs. It’s delivering on a growing number of fronts across the automotive business. Two big ones are quality management and sustainability.
The ambition behind Catena-X was to create the first-ever uniform standards for the secure but transparent exchange of data and information between car manufacturers, suppliers, dealers and software and equipment providers
Authorities require OEMs to promptly inform them of potential product-safety issues. However, it currently takes six to eight weeks for a Tier X supplier to receive feedback about quality issues from OEMs. To cut that lag, companies are harnessing traceability to share information.
For example, imagine an OEM were to find a problem with a lithium-ion battery during an end-of-line test. The traceability solution would help determine the scope of the problem at the OEM. The Tier 1 supplier that made the finished battery would get alerted automatically. That supplier would further diagnose the problem and alert the Tier 2 supplier where the problem appeared to have come from. The Tier 2 supplier would do the same with the supplier it identified as the problem’s origination point. When the root cause is identified, the responsible supplier would quickly inform all customers that received faulty components, again harnessing the traceability solution.
By pinpointing defects, assessing scope, and informing those affected more quickly, Catena-X participants can save an estimated 5% to 10% of the cost of a recall. Importantly, the system conforms with EU battery passport mandates.
That same transparency applies to sustainability. Carbon tracking of a precision that regulators worldwide will soon demand is a prime example. Establishing standardised product carbon footprint metrics based not on loose industry averages, but rather on measurements—ones valid across an industry with countless vehicle models, each with 30,000+ parts—was a heavy lift indeed.
The partnership with the World Business Council for Sustainable Development was crucial here, as was the development of a “Product Carbon Footprint (PCF) Rulebook” that standardised measurement and reporting to make carbon-emission data comparable across the automotive industry. Among others, Ford and WITTE Automotive are now using the system to track carbon footprints of suspension components.
In these and other ways, a foundation of traceability is boosting automotive supply-chain visibility while enabling new efficiencies and greater agility. Given the foundations Catena-X has laid and worldwide acceptance already gained, there will be further lighthouse projects such as Factory-X or Aerospace-X.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
Nadine Kanja is SAP’s solution head for Catena-X and SAP Industry Network for Automotive.
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