SAP Digital Manufacturing Drive’s Shinhwa Auto’s Expansion


In recent years, the automobile industry has experienced rapid transformation, largely fueled by innovations in digital technology. Leading the pack in embracing these changes is Shinhwa Auto USA Corp., which has exhibited a steadfast commitment to its North American expansion by utilizing SAP solutions, including GROW with SAP, SAP S/4HANA, and SAP Digital Manufacturing.

The South Korean automotive behemoth, known for its prowess in producing high-quality automotive parts, embarked on a vigorous expansion journey. Their vision? To not only increase production but to also integrate state-of-the-art digital tools that ensure efficiency in all operations.

Furthermore, two major events signaled Shinhwa’s intentions to cement its footing in the North American market. The first was the establishment of a whopping US$42 million factory in Auburn Technology Park West, Alabama, meant to augment the production of aluminum auto parts. This was closely followed by a $70 million expansion, introducing advanced aluminum die casting and post-processing equipment.

Fast forward to today, Shinhwa is on the brink of unveiling a colossal $192 million manufacturing facility in Auburn, a strategic move to cater to the surging demand for electric vehicle production.

However, impressive infrastructure alone wasn’t enough. The company also recognized that having the right technology infrastructure was just as vital. Shinhwa’s IT systems, crucial for streamlining back-office processes, required a significant overhaul. Moreover, there was an urgent need for a system that would seamlessly integrate enterprise resource planning (ERP), manufacturing execution systems (MES), and accounting software.

SAP Digital Manufacturing: The Game Changer

Shinhwa identified this gap and found its solution in SAP Digital Manufacturing. With a vast majority of major automotive companies relying on SAP, Shinhwa’s leadership team saw the potential in GROW with SAP, tailored for easy implementations in the public cloud. This marked the beginning of Shinhwa’s tech revolution.

Transitioning to SAP also means more than just updating their IT infrastructure. It’s about automating all manufacturing processes and collecting integrated data from diverse domains – from the shop floor to finance, from supply chains to customer interactions. The overarching goal? To evolve as the preferred supplier for leading global vehicle manufacturers.

Steven Lee, IT senior manager at Shinhwa, further emphasizes the company’s vision to redefine industry benchmarks for IT systems. SAP Digital Manufacturing, an MES system, stands out for its focus on sustainable, risk-resilient manufacturing operations, encompassing a resource-efficient Industry 4.0 strategy.

Charting the Future: Ambition Meets Execution

Looking ahead, Shinhwa’s roadmap is crystal clear. Beyond the present manufacturing plant and two upcoming ones scheduled for completion within the year, they are gearing up to establish seven more facilities. This expansion is in anticipation of the escalating demand from U.S. automotive clients over the coming decade.

SAP S/4HANA, coupled with SAP Digital Manufacturing, has provided Shinhwa with a clear glimpse into the future of possibilities. Through this collaboration, the company is deepening its American affiliations, preparing for the dynamic global shifts on the horizon.

Lee further points out Shinhwa’s significant contributions to the Auburn community, both in terms of financial investments and job creation. Their collaboration with SAP reiterates their unwavering dedication to setting new global standards.

With the scheduled go-live date looming on January 1, 2024, Shinhwa’s union with SAP epitomizes the harmonious fusion of manufacturing brilliance with digital mastery. It’s a testament to their commitment to innovation, growth, and excellence.

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