Motor industry portal drops online catalogues

Covisint, the online business-to-business exchange backed by auto industry giants DaimlerChrysler, Ford and General Motors, is to...

Covisint, the online business-to-business exchange backed by auto industry giants DaimlerChrysler, Ford and General Motors, is to drop online catalogues from its site and downgrade its reverse auction service.

The organisation, which led the drive for public B2B exchanges three years ago, will now focus on becoming a communications provider.

Next month it will launch the XML-based Covisint Messaging product, which aims to replace costly electronic data interchange and manual processes which automotive industry companies use to communicate.

Last month DaimlerChrysler executives said they had made savings by using Covisint, but Kevin Proust, automotive analyst at research firm GartnerG2 said Covisint products, such as auctions and catalogues, had only been used on a small scale.

Jeff Liedel, Covisint's vice-president of new product development, said the new messaging service would reduce "the complexity of managing multiple formats that have been dictated by customers and the multitude of protocols and connection points required to conduct business".

Proust said, "Covisint Messaging may be the company's last hope for survival."

B2B exchanges such as Covisint were promoted as a way to revolutionise the way organisations bought goods from suppliers, offering substantial cost and time savings, but many have fallen by the wayside.

Thilo Koslowski, lead automotive analyst at GartnerG2, said, "The whole premise of public exchanges was wrong. Companies are not going to want to give away their technology knowledge - a key competitive advantage.

"To go from competition to collaboration in one go was never going to happen. Private hubs make much more sense. Covisint could perhaps act as a connector for all these individual e-hubs."

Covisint has 10,000 registered customer companies.

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