Forecast Indicates Strong RFID Demand by Heavy Manufacturing

Other drivers of RFID in the automotive, aerospace and industrial-products manufacturing markets include legislative policies encouraging track-and-trace applications and RFID, Gouthaman says. Among them is the U.S. Transportation Recall Enhancement, Accountability, and Documentation (TREAD) Act, from the National Highway and Transportation Safety Administration (NHTSA), which calls for the tracking of tire identification numbers, or TINs. That legislation has prompted EPCglobal's participation in creating a specific RFID standard for the auto industry (see Auto Industry RFID Data Standard Proposed).

"The efforts of the Automotive Industry Action Group (AIAG) in integrating the B-11 tire and wheel label, and the RFID standard with the EPCglobal data formats, are expected to increase interest for item-level tagging within the automotive industry," Gouthaman says.

Gouthaman attributes some of RFID's growth among the automotive, aerospace and industrial manufacturing industries to high-profile companies' RFID initiatives, including those of General Motors, Ford, Boeing and Airbus. Boeing and Airbus, for example, are testing RFID to track engine parts through manufacturing facilities (see Boeing Outlines Tagging Timetable).

According to Gouthaman, there are potential pitfalls to RFID's growth in the three sectors. The technology's high costs, particularly for complete RFID installations, "could restrict the scope of the pilots and projects to the large [original equipment manufacturers], [electronics manufacturing service] providers, tier-one suppliers and distributors," she says.

In addition, concerns about the impact of RFID deployments on companies' profitability could inhibit growth. "A clear definition of the payback period is not easily conceivable, when enterprises are focused on objectives such as enhanced productivity, efficiency and optimal resource utilization," says Gouthaman.