Automotive Manufacturing: Cost Management & International Shipping
Automotive shipping holds unique challenges, especially in terms of dealing with inventory management and supply chain cost reduction. The logistical difficulties for transporting parts from one or more locations to their destination—like a distribution center or assembly plant—all add up to tremendous logistics costs.
Innovative Automotive Supply Chain Practices
Companies of all sizes need to look for new ways to stay competitive. Carter’s Shared Milkrun, for example, utilizes routes in which companies share the driver and the route with other companies. The unique split billing methodology is set up so that each company pays only a fraction of the route cost, based on the percentage of space they use. Split billing reduces costs and enables each company to function on lean, JIT principles. This service allows you to receive less-than-truckload service, at set window times, for truckload prices!
Tenneco Automotive and Eberspacher are two companies who benefit from the Shared Milkrun with reduced costs and streamlined logistics.
Quality Control in International Shipping
As production facilities and suppliers continue to move operations to Mexico, another key struggle for automotive manufacturers is quality control and efficiency in international shipping and border operations. Getting parts to and from Mexico is no small feat. Border controls, multi-cultural communications, and inconsistent trucking regulations put the entire process at risk for error and waste.
This makes it imperative to work with an expert in cross-border logistics. Many logistics providers can offer international service, but don’t have the procedures in place to maintain the same level of quality in each country and with each of the carriers in their network. Look for a 3PL provider that takes a controlled, informed approach to your international supply chain.
Automotive manufacturing in today’s economic climate holds challenges and uncertainties, but innovative practices and wisely chosen 3PL partners can offer supply chain management solutions that support long-term profitability.