The European Network eXchange so far has failed to meet most of its early objectives.
But ENX, a private communications network in Paris designed to offer automotive companies greater reliability and security than the Internet, may be gaining momentum. A new nonprofit legal entity has been formed to run ENX and a chief executive is to be appointed soon.
That is expected to boost momentum toward a planned link with ENX's North American equivalent, the U.S. Automotive Network eXchange, or ANX.
The link with ANX has been planned for Jan. 1, but it seems unlikely that it will occur by then.
The ENX legal entity is taking on the work previously handled by the Frankfurt-based VDA, the German association of carmakers and suppliers.
Work on the European network began in January 1998 at the insistence of the European subsidiaries of Ford Motor Co., General Motors and Chrysler.
Founding members - Ford, GM and Chrysler plus Volkswagen, BMW and Robert Bosch - signed a partnership agreement with the understanding that there eventually would be a link with ANX.
ENX counts 21 major carmakers, suppliers and trade associations as members. The members include every carmaker in Europe and Tier 1 vendors such as Siemens in Germany and Michelin in France.
Trade associations in Germany, Spain, the United Kingdom and France are also members.
Total membership will be limited to 25.
The nonprofit status of ENX mirrors that of the Auto Industry Action Group in the United States, the originator of ANX in 1995. But the future need to adopt a more commercial, profit-driven approach - as happened in the United States at the beginning of this year - remains a topic of debate among ENX members.
ANX was created in response to a growing belief that existing communications systems, including electronic data exchange, were complex, expensive and inflexible.
The organizers also were concerned that the Internet was an inappropriate platform for the speedy and secure electronic interchange of sensitive documents.
With $1.5 million in backing from Ford, GM and Chrysler and support from suppliers, the industry-specific communication system was created.
ANX is similar to the Internet but operates independently while using the same industry communication protocols.
While ANX service subscribers can connect to the Internet through the same physical hardware, traffic destined for the Internet does not.
Subscribers connect to ANX through one of several certified service subscribers, most of which also offer connections to the Internet as part of their service. Bundled Internet/ANX service is available over the same circuits.
ANX offers carmakers and suppliers a secure and reliable electronic network service to collaborate on product development, solicit and process orders, review designs, post and ship schedules, and trade e-mail messages. This typically replaces multiple network connections between Tier 1 suppliers and customers.
For Tier 2 and Tier 3 suppliers it eliminates doing business with multiple automotive trading partners.
Although developed specifically for the North American auto industry, ANX has been moving into other sectors, including the U.S. health care and financial services industries and government. The expansion into other industries has been driven by the sale of the program to Science Applications International Corp. in December 1999. ANX is operated by ANXeBusiness Corp., a wholly owned subsidiary of Science Applications International.
Despite ENX's renewed impetus, progress has been slower than originally forecast. ENX organizers say privately they underestimated problems resulting from different languages, a range of telephone carriers, geography, high local call charges and security issues.
Project officials had said they needed to sign up one-third of Europe's 11,000 suppliers to return a profit. But to date just 195 registrations - 150 in Germany, 30 in France and 15 in Spain - have been secured.
Of these, 80 percent are believed to be using ENX productively, primarily for computer-aided design/computer-aided manufacture applications.
Unlike in the United States, where carmakers have taken steps to encourage suppliers to adopt the ANX network, such pressure in Europe has been largely absent.
This has slowed adoption of ENX, as has high investment in existing systems among suppliers.
Sources close to ENX believe the targeted link with ANX could be completed on schedule at the start of 2001.
But industry observers don't expect it to happen that fast.
Despite the complex technical issues involved in connecting the European and U.S. networks, it is likely that political problems will prove harder to solve.
ENX sources say they are anxious to avoid being seen as playing a supporting role.
As a result, intense negotiations between the two sides are continuing.
Alexander Preston, the recently appointed CEO of ANXeBusiness, appears determined to expand the customer base for ANX outside the auto industry and to lower participation costs.
Whereas a continuous direct link to ANX in the United States can cost suppliers $2,000 a month, dial-up fees are being introduced progressively, some offering 20 hours of unlimited transactions for $295 a month.