Knobs, Switches and the Evolution of the Automotive Supply Chain

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Last weekend, a senior member of my family asked me if I could come along to help him shop for a car at a local dealership. What I thought was going to be a non-exciting “dealing with a car salesman” kind of day turned out to be a thought-provoking automotive supply chain awareness trip. After going over the inventory in the dealership system, we zeroed in on a car and decided to take it out for a spin. As soon as my uncle took the driver’s seat and started the car, he got dispirited and asked the salesman, “where are the knobs?” You know…the kind which you turn to start the radio, the air condition and the fans? The salesman informed him that everything is high-tech now and is in the LCD panel. My uncle was not impressed, but still tried to figure out the panel, which for myself sitting in the backseat found to be very intuitive. Nevertheless, he decided not to take the car for a drive and declared he wanted a car where you have to turn the knobs for radio volume, etc. The salesman informed us that for that make/model, knobs went away a couple of years back and since then, it is only available in higher priced makes/models. Hearing that, I started thinking about the automotive industry’s supply chain management in the background – how the advent of the LCD panel and its ever-increasing processing power has enabled firmware that can control the functions of a car without knobs and switches. This innovation has eliminated the need for knobs and switches, and removed material handling, moving part reliability issues, etc. And knowing how the supply-demand cycle works, it seems that roles have switched – the LCD panels are becoming more standard, while knobs and switches are now more premium features. And with software replacing several manual controls, we should expect to see this trend more and more. But then, demand always governs supply – If there are more uncles like mine, knobs and switches will always be available for those who want them, but they’ll be more expensive. For now though, my uncle was able to find an almost fresh used car on the lot with the features he was looking for.

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