Here are the e-procurement strategies of some of Europe's major groups:
Fiat Auto's e-business strategy will pass through two e-procurement portals: Covisint and Fast-Buyer, an e-business procurement network based in Italy and 95 percent owned by parent company Fiat SpA.
Olivier Dubois, who reports directly to Luca Molinari, head of Fiat Auto Information Technology, oversees all the Turin company's e-commerce strategies.
Fiat Auto will have access to Covisint through its purchasing joint venture with General Motors, GM-Fiat Worldwide Purchasing, based at Opel's headquarters in Russelsheim, Germany.
Fast-Buyer, a business-to-business portal for online purchasing, was created by Fiat SpA and Unindustria on June 1. Unindustria is a Turin-based consortium created for buying indirect and raw materials.
The new portal activity will cover services, indirect materials, raw materials and, later, direct materials.
Fast-Buyer aims to become the market leader in Italy, with transactions of over E15 billion and more than 10,000 companies connected online.
Fast-Buyer was created in cooperation with A.T. Kearney and Ernst & Young and will be handled by ITS, Fiat SpA's information technology company.
The main benefits for client companies will be the lower operating costs and faster process times which, together, should cut the average cost of the buying process by half, Fiat said.
Operationally, using two e-business portals will not be a problem for Fiat Auto, because they are based on the same technology from Oracle.
PSA/Peugeot-Citroen 'will participate in [electronic] marketplaces and we'll make a decision in the coming months,' said PSA Chairman Jean-Martin Folz at the Paris auto show in September.
Folz sees a wide range of advantages, from 'procurement logistics, to invoicing processes. [Electronic] marketplaces can provide great pay-offs, but PSA does not need to be a leader in creating a marketplace,' he said.
This indicates that PSA could participate in an existing trade exchange, such as Covisint. PSA shares many common suppliers with fellow French carmaker Renault, which is itself a member of Covisint.
PSA already purchases non-automotive parts, such as electrical plugs, on the web.
A specific portal for suppliers should be launched soon, says PSA. It will serve as an information exchange for products and prices, and will offer different ratings in quality control and logistics. It will also provide access to PSA's digital engineering platform, Ingenum.
Renault, together with Nissan, is a participant in the Covisint online trade exchange. Jean-Baptiste Duzan, Renault's vice president for purchasing, wants all Renault and Nissan purchasing to be handled through Covisint eventually. The two companies' combined purchasing business is worth $37 billion
Duzan says Covisint will become a provider of information services in three areas: purchasing operations (quotations, auctions, payment); supply-chain management (procurement, parts orders, inventory status); and product development process (electronic data exchange, technical requirements).
'It goes far beyond purchasing,' says Duzan. 'The benefits will also come from supply-chain management and product development. Those benefits include inventory reduction, better information about quality control, a quicker response to customers' demands and ... less paper as well.'
The next phase in Covisint's development will be the inclusion of Tier 2 and Tier 3 suppliers.
'It will be a major argument to convince our suppliers to join,' says Duzan.
Laurent Bourrelier, manager, purchasing division, is in charge of Renault's e-procurement and business-to-business activities.
He reports to Jean-Paul Meriau, vice president in charge of e-business. Meriau reports directly to Renault Chairman Louis Schweitzer.
VW is planning a staged introduction of its own e-market portal.
Niko Zoellner, vice president of A.T. Kearney in Dusseldorf, described the development of the portal as a marathon strategy. A.T. Kearney is one of VW's partners in the installation process.
'You can make a quick start in the beginning and then wait and see how far you come,' he said. 'But VW has chosen to have a slower start and to accelerate through several stages.'
So far, VW has organized 100 e-market auctions, but only for indirect materials and commodities.
The next stage will include more complicated components and services, such as logistics.
IBM, another of VW's partners, is building the network that will link the new systems with traditional procurement systems.
VW installed its Electronic Supply Link (ESL) portal last year. Following initial auctions for indirect materials, suppliers of more complicated engineering components were given guidance on procedures needed to use it.
Mark Laan, marketing communications spokesman at Polynorm in the Netherlands, said: 'We were informed about ESL in 1999. We can receive requests for procurement by e-mail and we have been given a log-in name and password.
'Via ESL, we also are informed about product descriptions in detail, including CAD [computer-aided design] data. With this information, we can design the component and make VW an offer.'
Polynorm, a Tier 1 supplier, makes roofs and body-structure side sections for the new VW Passat.
Mannesmann VDO, the German electronics supplier, has also benefited from VW's e-procurement system.
'We have been involved in a dialog function about logistics. Our first experience is that it is faster and more direct,' said Maria Lahaye of Mannesmann VDO.
Wim Oude Weernink
BMW IS bypassing the Covisint platform to set up its own Internet purchasing exchange and its information technology subsidiary Softlab GmbH has founded its own e-business-company called nexolab.
Nexolab will bundle all e-business activities of the entire BMW Group and, in the area of electronic procurement, will compete with Covisint.
Robert Bauer, BMW's chief procurement and information technology strategist said: 'We want to remain flexible and free to act in all marketplaces worldwide.'
BMW eventually wants nexolab to serve as an electronic system linking its entire system from supplier to customer.
BMW officials hope customers will help dealers configure cars for their customers and make changes in orders as little as ten days before production.