Hyundai Integrates with Tier-one Suppliers at First AS2-only Automotive Plant

Automaker uses solution from SEEBURGER to eliminate VAN fees, link with smaller suppliers using "Hub & Spoke" system

Automaker uses solution from SEEBURGER to eliminate VAN fees, link with smaller suppliers using "Hub & Spoke" system

Atlanta — March 2, 2006 — Automaker Hyundai Motor Company has deployed a B2B integration solution from SEEBURGER Inc. at its new factory in Montgomery, Ala., to enable Hyundai to bypass the use of value-added networks (VANs) and to bring previously non-EDI-enabled suppliers online electronically.

Hyundai will see estimated savings of $80,000 in annual VAN fees as well as the costs associated with manual document exchange, according to SEEBURGER. The savings in VAN fees stems from Hyundai's decision to transmit trading data exclusively over the Internet using the AS2 communication protocol, making the Hyundai facility the first AS2-only automotive plant.

The ability to automate communications with suppliers that previously lacked electronic data interchange (EDI) capabilities reflects the use of SEEBURGER's Hub & Spoke system, designed specifically for smaller trading partners. The Hub & Spoke system is being used with fifteen Korean-based tier-one suppliers that have U.S. production facilities.

The "hub" portion of the system is installed at the factory, integrated with SEEBURGER's B2B Gateway and configured with Hyundai's trading documents. Each "spoke" unit is a small downloadable Java application that enables the fifteen suppliers to exchange trading documents with the factory through the normal EDI data stream rather than by fax or other manual means.

"Most Automated Plant in the World

"Our goal in designing our Alabama factory was to make it the most automated plant in the world, and that included automating our just-in-time/just-in-sequence trading relationships to the highest degree possible," said Jing Tang Hu, manager of materials management at Hyundai Motor Manufacturing Alabama. "SEEBURGER not only offered a simple solution for connecting suppliers with whom we would otherwise have been required to communicate manually, but they also were able to provide AS2 services at a time when many other vendors could not. Over the long run, these two factors will result in considerable savings."

The SEEBURGER B2B Gateway is handling mission-critical collaboration, including forecasting and delivery notifications, between Hyundai and more than 50 tier-one suppliers of components for the Hyundai Sonata sedans and Hyundai Sante Fe SUVs being built at the Alabama plant. The solution is integrated with Hyundai's SAP R/3 system.

The implementation leverages SEEBURGER's 20-year EDI experience with over 3,000 automotive organizations to equip Hyundai with pre-built automotive-specific message formats and workflows for fast deployment, the solution provider said.

"The B2B implementation at Hyundai is arguably the most advanced in the automotive sector today, given the use of AS2 communication and our Hub & Spoke architecture," said Steve Sprague, vice president of product strategy for SEEBURGER US. "This contract reflects Hyundai's willingness to take advantage of the newest technologies available for effective communication with their suppliers, and it promises to serve as a model for other automotive OEMs that are upgrading or installing new B2B integration platforms."

Additional Articles of Interest

— Learn how a business process network ties in to the success of government mandate compliance and the 10 steps your company should take to accelerate business results in the exclusive article, "The Role of Trading Partner Integration in Achieving Compliance with Government Mandates."

— With its customers increasingly requiring new levels of connectivity, C&H Sugar deploys a 21st century IT infrastructure. Read more in "B2B Integration Spells Sweet Success," Best Practices article in the December 2005/January 2006 issue of Supply & Demand Chain Executive.

Companies in this article