With gas prices spiking, it's no surprise that Americans are flocking to car dealerships to trade in their gas-guzzlers for fuel-efficient gas/electric hybrid models. But those hoping to make the switch this summer are likely to be disappointed. Production of the more popular models lags well behind demand, and many dealers have long waiting lists.
But one automaker, Ford Motor Co., has a plan for getting hybrid vehicles to its dealers faster and RFID technology is playing a major role in the effort. Managers at Ford's Oakville Assembly Complex (OAC) in Ontario, Canada, have come up with a way to streamline the assembly of two new hybrid vehicles scheduled to go into production as early as this fall. That plan calls for expediting the delivery of just-in-time parts on a 24/7 basis by using an active-RFID-powered automated "fast gate" check-in and check-out solution that will significantly improve the site's freight and inventory management system.
Ford's installation of Santa Clara, Calif.-based WhereNet's RFID-based real-time locator system represents part of a transformation of the Oakville site to flexible manufacturing, which will help Ford avoid the lengthy and expensive retooling process required of traditional model changeovers. The plant, which currently builds the Ford Freestar and Mercury Monterey minivans, is slated to begin production of hybrid versions of the Edge and Lincoln MKX crossover sport utility vehicles (SUVs) in the coming months.
The WhereNet solution being installed at the OAC will cover 5.4 million square feet, making it the largest real-time location system-powered yard management solution ever implemented by an automotive manufacturer. The system was expected to be completely installed by mid-summer, giving Ford the needed visibility to track the movement of about 1,000 trucks a day, ensuring that each of the 2,000 parts needed to build a single vehicle is delivered to the assembly line precisely on time.
"Wireless tracking is the next wave in supply chain logistics and will complement the plant's conversion to flexible manufacturing," says Frank Gourneau, OAC plant manager. "Our flexibility will allow a quick increase in production of [hybrid] models, and wireless communications will help to get hybrid parts and components to the final assembly area at the precise moment they are needed and in proper sequence."
Orchestrating the movement of those parts and components will be no small feat. With flexible manufacturing, inbound parts shipments from suppliers are smaller and more frequent than with traditional operations, typically involving hundreds of daily truckloads of thousands of components in sequence. By automating the check-in/check-out procedures, the WhereNet system saves Ford several hours a day in time spent processing deliveries and increases efficiency in the supply chain.
In addition to the smoother flow of trailers, Ford will benefit from knowing the details on each truck and its contents. Precise information about its cargo type of engine or style of wheels, for instance will be beamed wirelessly to a database, allowing quick access to the information. Workers will be able to locate a trailer of tires for the production of the Edge, for example, and tell the system which dock door to deliver it to and when.
"With all of the additional trailers coming in and with the more frequent deliveries they will be receiving, Ford needed to handle an increased throughput for the yard," says Gary Latham, director of industry marketing for WhereNet, which began deploying active RFID yard management solutions for Ford in 2000. "The goal is to leverage the same facility but get more trailers coming in and going out each day."
In addition to moving more trailers, the WhereNet system is helping Ford optimize labor productivity by minimizing the amount of time workers spend searching for trailers in its yard. "If you can get the trailers in but you can't find them in the yard, it doesn't do you much good," notes Latham.
Partly cloudy, with scattered waves
The WhereNet solution calls for 68 overhead antennas that will perform a number of tasks within the wireless grid from reading transponders installed in trucks to providing full Wi-Fi and Voice over Internet Protocol (VoIP) access. Forklift operators working inside Ford's parts distribution center will receive realtime status information on shipments arriving at any of the facility's 177 receiving dock doors.
In effect, the WhereNet system puts a "wireless cloud" over the entire Oakville complex, with active RFID transmitters permanently affixed to trailers belonging to Ford's dedicated suppliers and temporarily affixed to others. In addition, WherePort magnetic "exciters" are positioned at each gate. When a truck approaches a gate, the fast-gate system reads the active tag, cross-references detailed information about the truck in a database, and automatically opens the gate to grant entry if the truck and its load are authorized.
The driver then drops the trailer load at a receiving dock door and departs via a similar automated checkout procedure, without ever having to leave the cab. Meanwhile, the WhereNet system captures the location of each trailer and precise information about its cargo and wirelessly transmits that information to a database, providing Ford personnel with instant access to this information.
"Electronically managed inbound deliveries will enable Ford and our suppliers to monitor truck status and improve just-in-time shipments, reducing freight and inventory-carrying costs," says Alex Kumfert, OAC's material flow manager. "This technology ... matches the demands for efficiency of a flexible operation."
passive gets aggressive?
It appears that things are about to get interesting in the yard management systems market. For years, the business has been dominated by players like WhereNet and AeroScout, whose solutions use active RFID tags and real-time locating systems (RTLS). But now their dominance is being challenged, at least where smaller yard operations are concerned. And the threat, ironically enough, is passive the passive RFID tag, that is.
Over the past few months, a venture-backed startup, PINC Solutions, has been running pilots using cheaper passive RFID tags (tags without their own power source) to track vehicles and equipment at four retailers' yards. In July, PINC launched its biggest test to date at a facility that handles 500 trucks daily. But PINC isn't the only company dabbling in passive tags. Third-party service provider Exel, in partnership with Symbol Technologies, Fluensee Inc., Xplore Technologies and Canada Cartage, is using passive tags in a pilot for Shoppers Drug Mart, a Canadian drug store chain.
PINC, which has non-disclosure agreements with its clients, has not revealed the results of its pilots. But Exel is clearly encouraged by the outcome of its test. "We are seeing that there is an opportunity with passive technology," says Tony Hollis, Exel's RFID strategy and execution manager. "Although this is an emerging technology and a great deal of product development is still involved, our solution providers are responding quite quickly to our feedback on improvements ... and are quite open to work with us to make this operationally viable."
Each type of tag has its strengths and weaknesses. For example, active tags rarely present orientation problems and can be read from distances of up to 5,000 feet. By contrast, passive tags have read ranges of only about 20 feet.
When it comes to price, however, passive systems definitely have the edge. Installation costs for active systems can run anywhere from $300,000 to $1 million for a yard with 400 or more trailer moves a day. In contrast, a company like PINC can go live with a system for a 100trailer lot for approximately $50,000, says Aleks Gollu, CEO of PINC Solutions. That's about one-tenth the cost of a system using active tags.
The same holds true of the tags themselves. While an active tag costs anywhere from $40 to $75, the passive tags used in the Shoppers Drug Mart trial cost less than $10 apiece. Though Hollis cautions that costs will vary according to the number of trailers and tags, he also hints that prices may drop in the near future. "[S]ome providers are very eager to be competitive in a space that has primarily been dominated by active and RTLS players," he says. "So that's certainly a consideration for end users."
PINC isn't shy about promoting its cost advantage. The company, which is heavily backed by Siemens, says its model aims to deliver a return on investment in less than a year. It also points out that it looks to make its money from software support only. "We don't depend on hardware revenue," says Gollu, "and when hardware prices go down, we'll take our hardware prices down accordingly."
But active-tag players aren't exactly ready to concede the cost advantage to their rivals. WhereNet, for example, is quick to note that it also passes savings in hardware costs along to its customers. It also points out that it has already cut prices by 20 percent this year.
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