ANX Urged for B2B

With only 200 trading partners connected so far, the Automotive Network eXchange (ANX) has a long way to go before it is the dominant mode of business communication within the auto industry.

But the ANX, the private network linking suppliers and automakers, remains a priority for the industry. The purchasing chiefs of General Motors Corp., Ford Motor Co. and DaimlerChrysler Corp. recently sent a letter to their shared suppliers encouraging them to subscribe to the ANX by the end of October.

They note that the ANX has met or exceeded the expectations of trading partners in terms of reliability, performance and security. The high-bandwidth communications system was conceptualized in 1996 and officially launched last year by the U.S. Big Three. Ford expects business-to-business (B2B) commerce to explode from $40 billion annually in 1998 to $1.3 trillion by 2003.

The Automotive Industry Action Group reports that as of September another 70 trading partners were connecting to the ANX, and that new partners are joining at about one per day.

Toyota Motor Corp. has decided against developing a personal Internet system for its suppliers and says it will begin evaluating the ANX in January, with pilot application planned for July-September.

Toyota decided to get involved because of the potential cost savings and faster product development cycle provided by electronic commerce. Jim Bolte, Toyota Motor Mfg. North America (TMMNA) general manager of information systems, says the automaker chose to investigate ANX because its research shows internal networks have had limited success including external trading partners.

The system also got a boost during a recent speech by Mark Baughman, Ford's supplier e-commerce manager, at the AIAG's Auto-Tech conference in Detroit. Mr. Baughman told a standing-room-only crowd of suppliers that Ford wants to expand its electronic link to suppliers, a link that ultimately will provide greater access to Ford's consumer research.

"We want to connect suppliers to consumers, and in the process virtually integrate suppliers with Ford," Mr. Baughman tells the crowd. An estimated 1,700 suppliers and 25,000 users are already on the global Ford Supplier Network, and Mr. Baughman wants a lot more in the future.