New logistics services target automotive aftermarket

April 17, 2018
Automotive aftermarket manufacturers and suppliers are under increasing pressure to improve supply chain performance. New services from DB Schenker and UPS could help them optimize operations.

Automotive aftermarket manufacturers and suppliers are under increasing pressure to improve supply chain performance. New services from DB Schenker and UPS could help them optimize operations.

In February, Schenker announced new solutions targeted specifically at the automotive sector. According to Stephan Allgeier, Vice President Vertical Market Automotive – Global Business Development Schenker AG, digitization and automatization are driving these new logistics services. 

A full transparent supply chain, reacting flexible on market demands while creating zero defects is key for our customers,” Allgeier says. “Although the level of automatization will increase, flexible and reliable HR concepts are still one of the major factors for success. DB Schenker as a global partner for its customers works proactively on those challenges.

UPS also announced it would expand its UPS Worldwide Express package service to reach 124 countries and territories. The service guarantees delivery in one to three business days. The service is used heavily by automotive customers in territories like Brazil (one of the expansion territories). South Korea was also part of the expansion, and the automotive electronics and aftermarket industries there will also benefit from faster supply chain performance.

Faster Service, Increased Visibility

Schenker will increase delivery frequency and other warehousing/logistics services for customers in the automotive market, as well as offer more specialized services.

For certain customers we are offering up to three deliveries per day to reduce expensive stock levels at the point of sale while providing a high level of parts availability,” Allgeier says. “To support these solutions, DB Schenker links warehouse services with transportation services. A full visibility of the supply chain can be offered by track-and-trace systems.”

Schenker not only provides traditional logistics services to automotive manufacturers and suppliers. It also operates warehouses and spare parts centers for a number of customers.

We are offering services around the physical inbound as well as supplier management, material requirement planning and value-added services,” Allgeier says. “For example, we deploy a team of experts who design shipping packages for oversea transports or we perform quality services. Of course, we add outbound services like pack and ship, national and international distribution and reverse management.

The UPS expansion, meanwhile, could provide more opportunities for smaller manufacturers and distributors to export parts globally. “Exporting companies do better, and have more diverse revenue streams,” says Darryl Barber, automotive segment marketing manager at UPS. “They are less likely to suffer because of economic obsolescence. If you haven’t tried exporting in a while, the technology has made it much easier and it’s not as expensive as you might think. There’s a growing need to get to these other countries, and having earlier delivery gives you an advantage.”

Barber says there are also opportunities in what have traditionally been considered smaller markets when it comes to aftermarket parts. “In Thailand, automotive is 12 percent of their GDP,” Barber says. “That’s a country where just-in-time delivery and managing inbound supply chain is important for production. Sweden is not a top export market for the aftermarket, but those numbers are increasing by double or triple digits.”

He also notes that countries like Chile are also valuable target markets. “In Chile, 95 percent of the market is imported, and a third of that is from U.S. companies,” Barber says. “And 70 percent of those parts are not OEM replacement parts. That represents a lot of room to grow for a small, independent company.”

E-commerce has a been a primary driver in terms of the expansion for logistics services in the aftermarket. UPS has service offerings that can make it easier to integrate online erodes with the company’s shipping app, for example. The company also announced a $7 billion upgrade to its network to increase capacity. 

3D Parts Printing

Schenker also announced some forward-looking high-tech services that could benefit the aftermarket. The company plans to provide 3D printing services to manufacturer replacement parts across the supply chain. According to the company, this would reduce warehousing costs, since parts would be manufactured on demand, and reduce delivery times.

As part of Deutsche Bahn Group, DB Schenker is still developing solutions for 3D-printing,” Allgeier says. “At the moment there are pilots running including our own manufacturing within the DB Group. At the end of 2015, the first printed part from a 3D printer for DB was a coat hook. Since then, DB has printed thousands of parts.”

Schenker is also participating in a platooning pilot with MAN Truck & Bus and Hochschule Fresenius. Using autonomous and networked vehicle technology for long-haul trucking could help reduce costs and improve efficiency, according to the company. 

Platooning is an approach in which at least two trucks on the freeway can travel in close succession using advanced driving assistance and control systems. The vehicles in the platoon are linked together by an electronic "towbar" that uses vehicle-to-vehicle communication, and the lead truck sets the speed and direction.

The forecasted transport volume and the individual traffic lead to an increasing traffic density. As a result, traffic jams occur and it becomes more and more difficult to manage transport solutions with a promised delivery time,” Allgeier says. “Platooning can be a successful way of making more efficient use of the traffic area while guaranteeing traffic safety. At the same time platooning saves fuel for the entire platoon through slipstreaming. The combination of increased efficiency, traffic safety and fuel savings is in the common interest of DB Schenker, its customers and the entire community.

The company will also provide specialized services for storing and transporting lithium car batteries, which are classified as hazardous items.

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