The automotive industry is highly competitive, with its manufacturers aiming to produce high-quality products at the lowest possible cost.
The biggest challenge?
Warranty claims.
Warranty claims and recalls come with enormous financial consequences. Warranty claims are requests made by customers for the repair or replacement of faulty product, with the cost of these claims ranking number one in the list of contributors to the cost of poor quality (COPQ).
Warranty Week reported in 2020 that manufacturers had approximately $29.8 billion in warranty reserves. This is how much manufacturers have set aside to cover warranty claims. Warranty claims are one of the most significant expenses in the automotive industry.
In 2020, according to J.D. Power, the average warranty claim cost for a new vehicle in the United States was $443 in parts and labor per claim. Another example is the electronics industry. Approximately $4.4 billion in warranty reserves were held by the top 20 electronics manufacturers in 2020, according to Warranty Week.
Reducing warranty claims requires critical initiatives:
- Use high-quality materials and components. If a manufacturer uses low-quality wiring when manufacturing electronic devices to cut costs, for example, warranty claims will likely far outweigh the apparent savings.
- Leverage the Industrial Internet of Things (IIoT) to improve outdated quality control systems. Manufacturers can reduce warranty claims by implementing more robust quality control systems made available by the ongoing digital transformation that is well underway.
- Challenge your quality control assumptions. Activities such as inspection, testing, and audits are helpful, but are they enough?
- Explore emerging technologies designed to take quality control to the next level. Proactive control and defect prevention is now possible.
- Look for systems capable of detecting emerging issues. Correcting issues before they disrupt the manufacturing process is the right application of AI, IIoT, and many other new and emerging technologies designed to serve the manufacturing industry.
An example of this is REVEAL® Plant Floor Intelligence®. A patented enterprise software solution developed by Trumble Inc., introducing the industry to the power of proactive quality control. As the name suggests, this technology reveals process variability and other emerging threats in the manufacturing process early enough to allow for corrective action before a loss occurs.
By leveraging the Cloud, the Industrial Internet of Things, and artificial intelligence, REVEAL® makes intelligent decisions based on the real-time state of the manufacturing process itself.
Combining this with a lightning-fast communication module that is smart enough to target only the appropriate problem solvers, creates a proactive quality control environment worthy of investigation. In your pursuit to find the right solution for your plant, be sure to ask about these topics before you decide.
One last note to consider. Every implementation of REVEAL® technology includes a change-management service as an essential part of each deployment.
Don’t underestimate resistance to change!
When implementing any new technology, be sure to include change management as an essential requirement with each deployment.
Learn more about REVEAL® by emailing customersuccess@trumbleinc.com or send your inquiries to curious@revealfactory.ai to explore these topics further.