Supply chain in the automotive industry is complex and requires constant attention to detail. Logistics specific to the automotive segment is on the path to improvement, with substantial investments being made by the government towards roadways, highways and rail capacity. In FY17-18 alone, India produced around 500,000 vehicles. The Automotive Mission Plan (AMP 2026) predicts that the Indian automotive manufacturing industry will grow from $66 million (2016) to $230 million in the next decade. With the implementation of GST, there has been an uptick in multimodal logistics and distribution. Speaking on multimodal logistics, Shashi Bhushan Shukla, Member of Inland Waterways Authority of India stated that National Waterways—1 has 4 main and 19 floating terminals are crucial towards the swift and speedy delivery of automotive and vehicular transportation.
In terms of inventory management, JIT is useful in holding inventory while saving on costs and space, thus requiring lower investment and easily sustaining the quality of goods processed. With custom checks at ports, which usually take up a lot of time, this inventory management method enables quicker processing at warehouses; thereby reducing the need for increasing the number of warehouses close to ports. Logistics has improved in efficiencies, from pre-assembly to grouping, quality control, to delivery of product to automakers through JIS-JIT. JIS and JIT, in essence, create a clockwork system through the synchronisation of manufacturing and material departments that facilitate production, and by extension help drive sales. However, JIS and JIT need prior planning, without which the execution may fall short.
Challenges for automakers
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