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The auto industry grinds its gears


 





BY PATRICK WAURZYNIAK
Posted Feb. 24, 1997

Two years ago, the automotive industry was heralded as the first major U.S. business sector to make the shift from conducting business over traditional value-added networks (VAN) to the Internet. With great fanfare, the Big Three automakers -- General Motors Corp., Ford Motor Co. and Chrysler Corp. -- heralded their ambitious plan to create a TCP/IP-based "unified industry network," dubbed the Automotive Network Exchange (ANX).

Currently, the automakers communicate with their thousands of suppliers using their own separate networks. Critical electronic data interchange (EDI) and computer-aided design and manufacturing and engineering (CAD/CAM/CAE) file transfers are often accomplished via a myriad of communications protocols.

The ANX, on the other hand, was designed to be a single, secure network for electronic commerce and data transfer. As such, it promised to assuage the industry's chronic design cycle problems by allowing the Big Three to collaborate in real time with their suppliers over secured areas of the Internet.

Upon completion, the highest-performing portions of the ANX would theoretically enable simultaneous engineering using multiple workstations or X Window Systems graphics terminals to run finite element analysis software, solid modeling CAD packages or even high-speed prototyping with the fastest communications links. The network will provide the bandwidth required, not just for CAD/CAM but also for applications such as advanced videoconferencing and three-dimensional virtual reality design sessions.

Hard Lessons
It hasn't been easy, however, to move a multibillion-dollar industry off an established communications model and on to one where standards for security and reliability are in ferment. Bureaucratic roadblocks and snafus have also plagued the effort, as the various factions struggle to agree on ANX's final format. Indeed, the past two years provide an object lesson in moving an entire industry to an Internet-based data communications environment.

Consider that the ANX was first conceived in 1994 by the Automotive Industry Action Group (AIAG), a Southfield, Mich.-based consortium of OEMs and 1,200 suppliers. It wasn't until 1995 that the Big Three endorsed TCP/IP as the single protocol.

In September 1996, the AIAG laid out an implementation timetable calling for selection of the ANX overseer in the next two months. The overseer would be responsible for approving the Internet service providers, establishing the central exchange points and creating basic security measures. At that time, the AIAG was also hopeful that a pilot would be up and running by second-quarter 1997, with hundreds of companies participating by midyear. Initial availability for the completed network was slated for September 1997.

As of February 1997, no overseer has been selected. In fact, the AIAG has now decided it needs to more carefully spec out the overseer's job. In January, it contracted with Bellcore to do just that. Bellcore has 90 days to map out exactly what the overseer should do -- how certification will be conducted, what metrics will be measured and how those metrics will be collected and analyzed. "It's very hard to evaluate bids to be the overseer until you've defined the functions," said Robert Moskowitz, a member of the AIAG's Telecommunications Project Team and information systems technical support specialist at Chrysler.

The ANX pilot is now scheduled for October, followed by "controlled availability" to U.S. and Canadian business partners before the end of the year. Bellcore is slated to support the planned pilot.

Industry officials involved in the project blame these delays on the Internet's ferment. Choosing standards for firewalls, encryption, uptime, response time and other technology measures in the flaky and fluid Internet environment has led to a lot of internal conflicts and confusion.

Plus, "realizing we need an overseer designer took a much longer time than we had anticipated," Moskowitz said.

Forging Ahead
Despite the roadblocks and delays, the AIAG is persistent in its efforts to build this network. According to industry experts, they have to be. Fierce competition overseas has raised time-to-market concerns and spurred an industrywide imperative to continually cut costs. Plus, information flow, particularly with smaller automotive suppliers, suffers greatly in the current environment.

The new network is supposed to cut the cost of doing business, but more importantly, it will speed new automotive designs. Automakers have struggled with a five-year design cycle, and they want to knock that down to less than three years.

"What the automotive industry is doing now is critical," said Ted Rybeck, president of Benchmarking Partners, a Cambridge, Mass., market analysis and consulting company that also operates a lab for Internet-based supply-chain best practices. While the Big Three are cutting edge in their EDI efforts, EDI is "a past paradigm. The key is going to be collaborative decision support between the final automotive dealers, assemblers and component manufacturers running right back through their suppliers. As much progress as the current [EDI] systems have made, they're ready for a new just-in-time solution," he said.

"With all of the reshuffling that's going on in the supply base and the increasing globalization of the industry, it's critical to have as rich an information base as possible in the industry," added David Cole, director of the Office for the Study of Automotive Transportation at the University of Michigan in Ann Arbor. "What the industry would like to have is a mechanism for facilitating engineering exchange. Now different suppliers converse in three or four different languages. That has been an impediment."

Major suppliers such as Johnson Controls, Inc., Champion and BASF Corp. have already developed electronic linkages to the Big Three or have them in development. They are using a combination of the Internet and VANs as conduits, though many aim to rely on the Internet as their primary pipeline.

Other suppliers are eagerly awaiting ANX for furthering both their EDI plans and CAD file transfers, the latter of which can still be expedited by clumsy manual transfers of magnetic tapes, Kirchoff noted. At Dofasco, Inc., a Hamilton, Ontario-based steel manufacturer, a private Internet-based virtual network called AutoLinx will eventually be connected as a node on the ANX, extending Dofasco's current EDI and CAD file exchanges with Ford and other automotive suppliers.

"ANX is the kind of network I think has enormous potential," said Doug Buchanan, senior specialist of applications development at Dofasco's IS division. Currently, Dofasco sends its steel parts designs to Ford via file transfer protocol. Ford does finite element analysis on the designs before transferring the data back to the steel supplier. "Right now, it's sort of a static sharing," Buchanan said, adding that collaborative or interactive CAD is possible with ANX. "My perception is that most of the technology to collaboratively do CAD/CAM over networks is there. ANX will help facilitate that."

Waurzyniak is a Detroit-based writer who formerly worked at Computerworld, InfoWorld and the Dataquest, Inc. market research firm as a CAD/CAM analyst.




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