Toyota Motor Europe (TME) has confirmed the use of specialist optimisation software to help manage its inbound parts logistics and reduce carbon emissions through a pilot project using software provided by optimisation company Agillence.
The software, Agillence Lean Logistics Optimizer (ALLO), was chosen to help the carmaker manage complex logistics network requirements while honouring lean principles, according to Agillence. The logistics planning software firm will be used by Toyota for a pilot period of a year, with the opportunity to grow into a long-term partnership. It’s an important breakthrough in the European market for Agillence, which is already working with OEMs and third-party logistics providers in North America.
Jean-Christophe (JC) Deville, head of production parts and vehicle logistics at TME said the software would help Toyota’s European logistics network towards the goal of carbon neutrality, while “supporting the identification of cost optimisation opportunities in parts logistics planning along with reduction of planning cycle time”.
The pilot project is part of several initiatives at Toyota Motor Europe to digitalise its logistics processes and to achieve ambitious sustainability targets. JC Deville spoke to Automotive Logistics about embedding carbon neutrality into the logistics network at the 20th Automotive Logistics and Supply Chain Europe conference earlier this year, when he said there are three main challenges that come with trying to reduce carbon emissions in the supply chain.
“The first one is how to measure where we stand and what we’re doing, and that is not an easy exercise,” he said. “We are collaborating internally and with external stakeholders to set the right way of measurement. The second is to grasp the low hanging fruits, maximising the use of trains, for example. Last year we opened many legs on finished vehicle trains and it’s not as easy as we thought but we keep growing and this is massively reducing the CO2.”
Third and “most complicated” is setting governance to balance cost and CO2 emissions.
Last year, TME starting exporting vehicles from the UK to Europe by rail, as well as linking its Valenciennes logistics hub in France with other European plant locations.
Deville added that logistics providers were not providing creative and disruptive solutions quickly enough, but ALLO could help change this. Agillence said it is incorporating end-to-end CO2 calculations and associated costs into ALLO to help shippers reach carbon neutrality.
Srini Paruchuri, vice-president of customer strategy and solutions, said: “At Agillence, we are advancing ALLO to cater to the unique geographical logistics complexities and demands of Europe.”
The software has already been adopted in North America, with Toyota’s US branch signing up for the use of ALLO in 2021. Nissan North America also opted for Agillence’s ALLO software to manage its inbound logistics, simultaneously optimising network design, frequency of delivery, routing, stowage and dock and driver schedules. In April, Penske Logistics, a major 3PL with significant business in the automotive sector, also partnered with Agillence to use its software in logistics engineering and design.