Key KPIs for Automotive Industry

 In Analytics, Automotive Industry, Business Intelligence

Automotive industry uses KPIs or Key performance indicators to track the industry’s performance. It helps them make better business decisions and are very important for the success of their industry. KPIs helps industries achieve their goals and helps them gain high operational efficiency.

Automotive industry is an industry which develops and manufactures cars. It is an extremely flourishing industry and high on demand industry. And so to make sure that the productivity gets maintained within an automotive industry, KPIs are important. KPIs works on the collected data. It is a very powerful tool that helps different industries analyze the way they are working.

It is central for automotive industry to track the major KPIs to further invigorate their development process. Important KPIs which helps track the performance of the automotive industry are as follows:

1. Sales

The amount of sales generated is one of the major metrics when it comes to an automotive industry. All the industries want to achieve higher sales rate. The higher the amount of sales generated, the higher the profit. This is why, it is important to have some form of tool or mechanism to track the amount of sales produced within an automotive industry.

High profit gets achieved through higher sales generation, which in turn, leads an automotive industry to the path of success. The amount of sales generated gets calculated in terms of different areas of an automotive industry. It also brings to the eye the problem areas that could be stopping the industry from performing its best. Hence, it is vital for an industry to track the major KPIs as it helps them leave their impact in the business market.

2. Gross Profit

Gross Profit refers to the total profit that an industry makes. It is one of the most important KPIs to track when it comes to an automotive industry. Gross Profit helps the industry know about how much profit they managed to earn through their sales rate. And depending on the result of the gross profit,they take the required actions to further enhance the growth of their company.

It indicates about the staff and industry performance. For instance, low gross profit reveals the industry about the poor performance of the industry and compels it to implement steps to change the poor state into a better one. And high gross profit indicates that the industry is doing well and it encourages them to further boost their working efficiency.


EBITDA or Earnings before interest, tax, depreciation and amortization refers to a measure of calculating the working efficiency of an industry. This is also one of the important KPIs to gauge for an automotive industry.

It measures the earnings of an industry before taking into consideration the other aspects. All the other aspects like tax, interest and depreciation are not counted when it comes to the total earning in case of EBITDA.
Automotive industries tracks EBITDA to keep track of the earnings that it makes for maintaining their overall productivity.

4. Inventory management

Inventory management is another KPI to track for an automotive industry. How well an industry is performing depends greatly on its inventory. Inventory refers to the all the raw goods or work in progress products or the products that complete and fit for use. Inventory management is very important because it helps the industries maintain their inventory in the best way possible so that it does not hinder their progress in any way.

Inventory management gets done not only in an automotive industry but in all the other kinds of industries in the business world. If an inventory is not maintained then it can lead to the poor quality production of goods. And if an inventory is over-maintained then this results in great financial loss for an industry. Hence, proper management of an inventory is indispensable. An inventory is filled with the goods that are currently on demand in the market so that the out-of-stock issues gets prevented. Also, if an automotive industry is able to meet the future demands based on forecasts, then proper management of inventory is achievable.

5. Accounts payable and Accounts receivable

Accounts payable or, A/P refers to amount of money that the industry owes to the creditors in the business. It is very important for the automotive industry to keep track of this KPI as it helps them maintain their financial position effectively.

Another important metric to gauge for the automotive industry is Accounts receivable or, A/R. Accounts receivable refers to the amount of money owed to the company by the debtors or clients. This also helps keep track of the financial status of an industry, hence it is very important to measure this effectively.

So, those were the important KPIs for the automotive industry that drives great business value. Using these KPIs to maintain the balance and productivity in an automotive industry paves a path for this industry to get successful in the business world.

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