Renault is implementing a number of logistics measures to support increased capacity at its Avtoframos plant in Moscow, including a multimodal solution for parts supply from its parts plant in Pitesti, Romania and new tenders for LSPs to manage the supply of local parts as part of its plans to increase local sourcing in Russia by 75%.
The carmaker is investing €150m ($204m) on top of its original €230m investment in the plant, which makes the Logan, to double capacity from 80,000 to 160,000. This increase will include the introduction of a new five-seater hatchback model–the Sandero–with the budget SUV Dacia Duster to be added by the end of 2011.
Renault gets parts for production at Moscow from suppliers in Western Europe as well as from its production and logistics centre in Pitesti, Romania, where it also produces the Logan and Sandero, as well as engine and gearboxes. It currently works with six different logistics providers but the increase in production has led Renault to now launch a tender for further logistics provision to ensure capacity is maintained between Romania and Moscow.
It has also led Renault to look at a multimodal solution for the supply of parts from Pitesti, using both road and rail.
“The logistics capacity for the parts coming from Pitesti has been secured with the implementation of a new rail flow, in addition to the trucks flow,” a company spokesperson told Automotive Logistics News. “Studies are on-going for the rationalisation and the optimisation of this multi-modal solution.”
The company is also looking at greater use of local suppliers and the establishment of a unit to manage the collection of parts from the major suppliers in the area, something that is currently handled by the suppliers themselves.
Local content for startup for the Sandero is 44%, the same as for Logan at present but the ultimate aim of increasing local content to 75% will be achieved by growing the supplier networking partnership with Nissan.
“Renault is developing local sourcing in Russia, but is going to change Inco [international commercial] terms and manage local parts transportation. For this need, new providers will be selected in order to cover the different supplier’s clusters," said the spokesperson.
In terms of the outbound movement of finished vehicles Renault uses three providers to carry the vehicles to its three external compounds, with a further seven providers used for transport to the dealer network, which also includes the use of rail for long distance.
Renault said the main challenge for outbound now is for the storage of finished vehicles, and the company is looking at extensions to its storage facilities.
In 2009 the Logan was Renault's top-selling vehicle in Russia, enabling the company to grow market share to 5%.