Caterpillar Logistics is setting up a new parts distribution facility in the Tejon Ranch Commerce Center in Kern County, California for the supply to Caterpillar dealers and customers throughout the western US.
The 37,160m2 facility is expected to be operational by the end of 2012. It is the fourth such facility the company has opened in North America as it moves away from having smaller regional distribution centres towards larger facilities and expands its global distribution network in North America.
A distribution centre in Waco, Texas became operational in 2009, followed by the Clayton distribution centre in Ohio, which opened in May this year. During the summer the company also began construction on a parts distribution centre in Spokane, Washington, which is expected to be complete in mid to late 2012, replacing its existing facility there.
“A key component of the expansion and enhancement of the North American Cat parts distribution network is to move away from the smaller regional distribution centre concept and to move towards all facilities being the larger, more flexible and efficient, full-facing facilities throughout North America,” said a Caterpillar spokesperson.  
As with the other three facilities, the Tejon Ranch parts centre will employ Cat Logistics’ Service Parts Management (SPM) software solution, which replaces multiple software systems supporting the Caterpillar parts network. Cat Logistics worked with Ford and software provider SAP to develop the application, which provides fully integrated order, materials and warehouse management. It is deployed to manage aftermarket parts business, which, according to the company, involves the movement of around 25m SKUs annually.
“Steady growth in the parts business over the last several years and forecasted growth in the future has significantly impacted our network’s ability to deliver parts to our customers,” the spokesperson told Automotive Logistics.
The Tejon Ranch Commerce Center is one of California’s leading logistics hubs and already holds 3m square feet of existing warehouse facilities. It is located at the junction of Interstate 5 and Highway 99 and is provides convenient access to the major regional airports said the company.
“This location puts inbound receiving points closer to suppliers and aligns outbound shipments for improved delivery to dealers and customers,” added the Caterpillar spokesperson.
Earlier this year Caterpillar announced that it was considering a range of options concerning the future of the 3PL part of its logistics subsidiary.
“The strategic options under review are a potential sale or operating it more independently as part of Cat Logistics in the future,” a spokesperson told Automotive Logistics News.
Caterpillar manufacturing logistics and the transportation operations and Caterpillar
brand parts distribution are not part of the 3PL business and will continue as core businesses within Cat Logistics.
An announcement on the 3PL business is expected by the end of the year.