Flexibility in the supply chain remains the most important challenge for OEMs and LSPs according to surveys held at last week’s Automotive Logistics Global conference in Dearborn, and crucial to maintaining that flexibility was the ability to share information and remain innovative, something that needs improve and quickly.
The surveys revealed that 40% of delegates believed that balancing transport capacity to meet demand would be the toughest thing for inbound LSPs, while 43% thought as much for outbound logistics.
Chrysler’s Steve Tripp, senior manager for worldwide vehicle transportation, anticipating a bumpy, uneven recovery, stressed that information sharing between OEMs and LSPs would have to improve. “The market could move up or down in 10-20% directions in the next few years,” he said. “We will have to stay very close with the providers. If you [finished vehicle logistics providers] aren’t close to our production schedules, then get very close to them.”
LSPs said that the most important way to keep a relationship strong with OEMs was to constantly offer innovations and opportunities to cut cost. “This year, if you want to be heard, you have to tell the OEMthat I can help lower cost, help you pay as you go and lower inventory,” said IT-provider i2’s Kelly Thomas, senior vice president, product strategy and planning group. From the software and IT perspective, Thomas said that he saw that trend toward “cloud computing”, with non-intrusive software that has much lower upfront costs.
While uncertainty will factor into everyone’s plans, from managing transport capacity, to production plans and investment, the carmakers at the conference made it clear that there would be more opportunities both at home and abroad next year. Both Chrysler’s Tripp and GM’s Vicki Streukens, director of vehicle logistics, said that they expect export numbers to increase significantly as those two companies pick up the pieces from their bankruptcies. “To say that the numbers would at least double would not be an exaggeration,” Tripp said.
The next Automotive Logistics conference will be held in India between 2-4 December. More information is available here.