As a keynote speaker at the upcoming AIAG Supply Chain Summit on June 18, 2019, Mike Sturgeon will provide a unique perspective on the most pressing challenges related to global standards. In this exclusive sneak peek of his upcoming remarks, Sturgeon, the executive director of ECG, the Association of European Vehicle Logistics, will explain why AIAG and ECG are uniquely positioned to help the automotive industry move forward with global standards for global products.
Sturgeon is a well-respected industry leader and has held various senior positions in vehicle logistics within Toyota's European operations. He worked for leading logistics service providers prior to joining ECG. Established in 1997, ECG represents the interests of over 100 member companies and is a champion of the European vehicle logistics sector. ECG members provide transport, distribution, storage, preparation, and post-production services to manufacturers, importers, car rental companies, and vehicle leasing operators in the European Union, Norway, Switzerland, Serbia, the Russian Federation, Ukraine, Turkey, and beyond.
Q: What are the similarities and differences between ECG and AIAG?
Sturgeon: The two organizations have grown up on opposite sides of the business, with AIAG developing more around the inbound side. ECG, which is a slightly younger organization, was founded as a platform for the finished vehicle logistics (FVL) sector in Europe. Whereas AIAG has expanded to include some focus on outbound too, ECG remains exclusively an association for FVL. ECG is also considerably smaller than AIAG — with only five or six people on our team — but that’s a significant resource of people focused entirely on outbound.
One other key difference is that ECG’s rules allow only vehicle logistics operators to be members. This means that the OEMs are not directly members of the association, though we obviously work very closely with them. Other organizations, such as IT companies and trailer manufacturers, are also excluded by this rule. We have special arrangements that allow them to be partners of ECG. In practice, we all work together.
Q: Where is ECG focusing its efforts now regarding FVL?
Sturgeon: We will continue to promote successful areas such education, where our respected ECG Academy is now recruiting for its 14thyear. It remains the only qualification we know of anywhere in vehicle logistics.
We will also continue to do a certain amount of lobbying here in Brussels when there are specific topics that concern us, such as the allowed loaded length of car transporters in Europe — a topic we do not have room for here. We will continue to educate and inform our members. And, we will continue to provide many networking opportunities for the industry, including our annual ECG Conference and our Spring Congress, which are by far the largest events in Europe in FVL.
Most important of all, through our many different working groups, we will continue to strive for standardization in all aspects of this business where we see that this can deliver better efficiencies and consequent savings or higher service levels for all concerned.
Q: How will digitalization affect FVL in terms of efficiency and productivity?
Sturgeon: Without a doubt, digitalization is what will change the job — indeed all our lives — the most in the years ahead. We are seeing this already, albeit only in a small way so far. What we must beware of, however, is assuming that in a digital world there will be nothing left for us poor humans to do.
One of the biggest challenges we all face at the moment is recruiting drivers for our trucks — in fact, it is a global issue. Young people are already assuming that trucks will drive themselves five years from now, so they do not consider this a career choice. We have a big task ahead of us to convince them otherwise. In reality, I do not believe that I will ever see cars autonomous enough to load themselves on a truck, lash themselves down, be autonomously driven to their destination, and then unload themselves.
However, as far as visibility of the supply chain is concerned, I believe we will see this business totally transformed. The plethora of different technologies out there today will no doubt move toward some sort of common standard, and I really hope the last remaining bits of paperwork will be abolished. It is extraordinary that the OEMs are still sticking bits of paper with bar codes and VIN numbers in the windows of their vehicles at line off. Here in Europe, we still have no legal alternative to the paper delivery notes for international transport. As so often, the technology is moving far faster than our legislators are able to do.
Q: What do you view as the biggest opportunity for collaboration between U.S. and European auto manufacturers?
Sturgeon: I do not believe that we should define the manufacturers by where they are based. Regardless of where they are headquartered, these days all OEMs are building global products for the global market; it is just that some are more dependent than others on particular regions.
The big opportunity is for all the manufacturers to collaborate on any area where standardization can deliver efficiencies with the potential to benefit the entire industry. The emphasis here must be on the word all. If you standardize things in the supply chain, the real benefits only come when everyone adopts the same standard. It only takes one to be using a different technology, for example, and the benefits cannot be achieved.
Q: What specific FVL/supply chain topics will you discuss in your presentation at the AIAG Summit in June?
Sturgeon: I am very much looking forward to the opportunity to join AIAG at the upcoming Supply Chain Summit. In my presentation, I will focus on all of the different activities that fall under our Digitalization Working Group for the simple reason that these are the issues that are the same for all of us.
We need global standards for global products. I firmly believe that ECG and AIAG are uniquely placed to help make this happen, and I look forward to sharing our ideas with everyone.
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