Volkswagen was right to build its own web-based exchange, says VW purchasing boss Francisco Javier Garcia Sanz.
Sanz says the decision to build its own e-purchasing network - Electronic Supplier Network - has put VW ahead of rivals such as Covisint.
'We are out of the pilot phase and are already conducting online auctions and ordering,' he says.
Sanz says in mid-October there were 4,700 suppliers linked to Volkswagen through Electronic Supplier Network, supplying 97,000 parts worth about DM2 billion (E1 billion) a year.
Volkswagen plans to add additional purchasing and logistical functions to Electronic Supplier Network by the end of this year.
The full rollout of the system will follow in early 2001.
Sanz says the biggest cost savings potential is in non-production goods and services that account for only 15 percent of VW's DM96 billion of purchases - but 80 percent of the transactions.
Sanz says Volkswagen expects a leaner and faster purchasing process through Electronic Supplier Network, with processing times cut by 70 percent and processing costs reduced by up to 60 percent.