APRIL 202419manufacturer must pay close attention to, as it is just lost as liquid cash. With the increased adoption of EVs and the rapid growth of the the e-mobility sector, the cost of quality has increased significantly. This is because since the products are in the development stage, there is always trial & error and chances of unexpected things to turn-up. For such aspects, I personally suggest companies to concentrate on some of the key factors during the developmental phase itself as a preventive measure in order to reduce the cost of quality during the mass production stage. On the other hand, there are high chances of failure cost whenever any new product is being introduced into the market. To summarize, validating the products using the right methods with the right development time goes a long way in reducing product failure and quality costs. Key Financial ChallengesDue to the constantly changing market dynamics and customer expectations, cash flow management has been a very important aspect for all organizations in recent times. Today, consumers are looking at the kind of advanced technology featured that they will have access to in their cars. In light of this, the dashboards in most of the cars today are completely filled with touch-sensing switches, which was not the case five years back. Today, most of the automotive OEMs are developing sensory touch panels in the steering wheel itself. However, developing all these tech advancements require a lot of investments but give back a low ROI, which is a major challenge for automotive manufacturers today. Thus, most OEMs are rolling-out these features in a step-by-step manner. Some of the other factors that are causing major setbacks to the automotive manufacturing industry in recent times are the global recession, Russia-Ukraine war, and similar other geopolitical crisis.ESG in Automotive Manufacturing A few of the primary responsibilities of the automotive industry is to play its part towards the growth of our country's economy, create employment opportunities to the people and also contribute towards ESG. Additionally, there are many regulatory frameworks being put into action by the government that make contributing towards ESG mandatory for all companies irrespective of their industry. Being one of the biggest contributors for the environmental pollution, the automotive industry is putting-in a lot of efforts lately to reduce its adverse effects on the environment. Some of the key steps taken by organizations in this regard are having efficient energy management systems in place, contributing towards green energy consumption, smart usage of water and many others. Although incorporating all of these steps require a lot of capital investment and do not promise any fixed ROI, it is important for organizations to keep in mind that the investment that the investment that they will be doing in terms of ESG will bring-in long term benefits, while simultaneously enhancing the brand image as an ecofriendly and sustainable company.
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