Volkswagen drives RFID use through its supply chain

VW is investing in RFID

Volkswagen is to implement radio frequency ID (RFID) tagging in its manufacturing supply chain to improve logistics and the flow of materials.

The company has successfully completed a one-year pilot, working with IBM, in which shipping containers carrying auto parts destined for Volkswagen were fitted with RFID tags. As a result, the system will be introduced at the firm’s central logistics hall, located at its major plant in Germany.

IBM claims the carmaker will be the first to make such widespread use of the technology in this way.

Information on the tagged containers is automatically collected by RFID readers at key locations throughout the supply chain, from the supplier's shipping department, through transportation until arrival at Volkswagen, as well as during storage, collection and installation on the assembly line.

The same process is used when Volkswagen returns the empty shipping containers to suppliers to ensure that all containers are sent back after the parts are received. The technology will also reduce the need for paper documents and barcode labels.

“Our long-term goal is to implement an integrated, paperless production and logistics chain throughout the whole group,” said Volkswagen Group chief information officer Klaus Hardy Mühleck.

“The pilot project showed that we can reliably integrate RFID technology into our business processes at a low cost.”

For the pilot, Volkswagen fitted 3,000 shipping containers with passive RFID tags, supplied by Intermec. The technology has been refined to automatically register metal containers, which normally interfere with RFID technology. The tags were used on containers carrying sunroofs for the new Volkswagen Golf. Readers at the entrances to the manufacturing line, along with mobile handheld scanners and forklifts were used to identify the containers and their contents.