The Tyre Industry Needs to Reinvent Itself

Tyre Industry

History looks back at the wheel as perhaps the greatest mechanical invention by mankind – one that got civilizations rolling by being a revolution in itself. Today, more than 5000 years since the discovery, the wheels of fortune are rolling in favor of the tyre Industry.

The tyre Industry in India is going through a major transformation over the last couple of years. Synthetic rubber is the primary component in the manufacturing of tyres and to make synthetic rubber; crude oil plays a significant role. Since 2014 global oil prices have been on a decline from $108 a barrel to about $48 a barrel. Though there has been a recent increase in the oil prices however for tyre makers there is a scope to channelize the savings from their input costs to R&D and product innovation.

Tyre makers especially the R&D and product development teams have multiple goals and pressures from stakeholders. There is a significant push from sales and dealerships to meet up the ever-increasing consumer demands in a competitive market with faster go-to-market and reduced costs. Further, there is increasing demand to develop tyres for lesser gasoline consumption to formulating with recycled rubber, developing tyres that have low-wear and tear, that have high-grip and reduce environmental impact and changing formulations between the likes of natural and synthetic rubber to improving overall efficiency.

For tyre makers, this creates a need to reinvent and digitally transform their manufacturing operations end to end. The promotion of concurrent work & communities to optimize company resources and leverage its assets, the improvement of several factors including quality and performance, bidding processes, manufacturing processes, product validation based on the assurance of performance and reliability, efficiency between business units are all crucial for the tyre industry. Precautionary measures are also a must. These include- the reduction of scrap, development of new recipes and protection of intellectual property. Combined with the growing pressure for the preservation of natural resources and reduction of environmental impact, the usage of more and more synthetic rubber is also a necessity.

This plethora of steps to be followed will reap benefits to a great extent. Not only will it reduce operation costs, increase hit ratio and reduce the time taken to quote; it will also speed up new product introduction, quotation accuracy and ensure customer satisfaction through timely delivery. This will help tyre companies retain existing customer base and create a foundation for further expansion. The process of entering new markets will expedite, as companies can capitalize upon and reuse intellectual property to further lower costs of R&D.  Faster integration of new acquisitions will ensure that the organization has lower costs, faster timelines and higher margins – be it on their existing market or in a new one.

Not just the above, the steps will go as far as guaranteeing a price premium, reducing the direct material cost and increasing the production volume. This exponential growth will boost innovation – eventually ensuring a price premium with new concept tyres.

These steps require a change in ideologies of how departments function in an organization. While not major, these include the introduction of a modularity approach in the semi-finished development and standardizing of material and tyre qualification processes to ensure smoother Quality Assurance & Quality Control. This harmonization of production processes will ensure a consistent quality level, and organizations must learn from historical data to build the best production practice possible to achieve the same. This will extensively help with improving the collaboration between design, sourcing, production, and services – thus pushing the organization towards greater levels of competence.

Most importantly, as the biggest makeovers require some of the best tools of the trade to pan out well, an organization needs applications and practices to bring about these seemingly large changes into play. The most fundamental step will be to integrate a single collaboration platform across the company. This will provide a foundation to optimize semi-finished portfolios, elaborate study and test plans, analyze results for future reuse and further, in tandem, provide a data mining solution to analyze historical data.

For larger organizations, this will ensure that the best manufacturing practices are shared and operations are synchronized across product supply networks. For Science and R&D teams, the platform will serve as a boon – serving as a scientific platform for advanced material modeling and simulation.

In conclusion, for an industry booming at a 4-6% estimated growth for FY2017 and with rating agency ICRA expecting domestic tyre demand to grow by 4-6% over the next three years, improvising, adapting and overcoming hurdles in growth through the application of digitalization is a necessity.

At Dassault Systèmes, with the 3DEXPERIENCE Platform, we plan to leverage our relationship with several industry players and take them through the digitalization and reinvention journey.

amitanjan.banerjee@3ds.com'

banerjeeamitanjan

amitanjan.banerjee@3ds.com'

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