Digitization in the Auto Industry

Will RFID tagging become the standard among automakers?

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

The factory of the future is rich with information—every piece of equipment continuously reporting its status, enabling the entire production line to adjust dynamically on the fly. A key component in this Industrial Internet of Things (IIoT) is the humble radio frequency identification (RFID) tag, particularly for manufacturing execution systems (MES) and supply chain management.

But how far will manufacturers go when it comes to RFID tagging? Are the benefits worth the cost?

To find out, researchers from the Fraunhofer Institute for Factory Operation and Automation have been conducting feasibility studies with Mercedes-Benz Vans at the company’s factory in Ludwigsfelde, near Berlin.

“Radio frequency identification, or RFID, tags on parts can boost process reliability and efficiency significantly,” said Marc Kujath, research scientist at the Fraunhofer IFF.

The researcher’s RFID system consists of tags on key parts combined with an optical scanner. The researchers identified 40 vehicle parts as best suited for tagging, with a particular focus on mirrors and seats.

Automatic In-Process Inspection

There are two important differences between using barcodes and using RFID tags to track critical parts.

First, while barcodes merely store identifying information, RFID tags can include a part’s history as well as information about the vehicle in which it is to be installed. The second important difference is that barcodes must be read manually, one at a time, while RFID tags can all be read simultaneously by a single optical scanner—even after the parts have been installed. As a result, all of the information contained within an RFID tag can be retrieved at any time in seconds.


(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

The Fraunhofer IFF researchers cite this as a crucial advantage in auto manufacturing, since it allows workers to verify the installation of all requisite parts on a front or rear axle, for example, while it is being mounted. Prior to these studies, the axles were not checked until final inspection, which required employees to conduct visual inspections and using paper lists.

“RFID tags enable us to boost transparency,” said Kujath.

Improving Production Scheduling

According to the Fraunhofer IFF researchers, the transparency resulting from the RFID tags also benefited Mercedes-Benz Vans production as a whole. “For instance, we reduced the blind spots in production scheduling,” explained Kujath. “This means that a project manager now knows where the snags in the process are located—and can ask the right questions at the right time. We additionally thought the different roles through. A project manager ultimately needs different information than a technician.”

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

The next step, according to Fraunhofer, will involve standard tests at Daimler.

RFID in the Auto Industry

As is often the case in manufacturing, the question of whether to adopt RFID tagging in the automotive industry comes down to one crucial variable: cost. According to the RFID Journal, passive RFID tags cost from $0.07 to $0.15 USD. Volume obviously makes a difference, but in the auto industry, 7 cents per part adds up quickly, especially when your margins are razor thin.

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

(Image courtesy of Fraunhofer IFF/ Andreas Süss.)

It’s possible that the price of RFID tags simply needs to hit a tipping point—say, 5 cents per tag—at which point RFID will become the industry standard, but even in such a case, it seems unlikely that every part will be tagged. Still, if the gains in efficiency outweigh the additional cost, RFID seems like a no-brainer.

What do you think? Will we see a steady increase in the adoption of RFID in the auto industry?

Comment below.