How to Revolutionize the Downstream Finished Vehicle Supply Chain

The downstream finished vehicle supply chain is a complex network of interdependencies that can often hamper efficiency and drives up costs. Every link in the chain, from vehicle processing centers to transporters and dealerships, faces challenges that stem from a lack of visibility into vehicle location and movements. 

But what if there was a solution that could transform this landscape, mitigate the challenges, and revolutionize the entire supply chain? 

Enter real-time vehicle visibility. 

In this post, we’ll delve into some of the ongoing challenges faced by the downstream finished vehicle supply chain and explore how real-time vehicle visibility offers a transformative solution that could accelerate operations and cut costs. 

5 Major Challenges of the Downstream Finished Vehicle Supply Chain

1. Multiple Vehicle Movements: Relocating vehicles multiple times within vehicle processing centers’ yards increases the risk of damage, consumes fuel, and adds to driver workload. These movements are often triggered by decisions made by vehicle manufacturers for accessorization, dealer shipments, or market customization.
2. Inconsistent Workloads: Vehicle processing centers experience peaks and troughs in workload due to vehicle carriers arriving to pick up their loads. This results in long wait times, multiple vehicles being moved simultaneously, and potential damage. Detention charges may be incurred when the center exceeds transporter wait time limits.
3. Challenging Working Conditions: Drivers within vehicle processing centers face the unfavorable task of locating vehicles across the massive expanse of a vehicle yard —and in all sorts of extreme weather conditions—while under pressure to avoid damage to vehicles. In this role, turnover is high, leading to recruitment and training costs for replacement drivers.
4. Short-Shipped Loads and Truck Wait Times: Vehicle carriers aim for full loads and minimal queuing time at vehicle processing centers but often face difficulties. Vehicles scheduled for collection may not be found, resulting in short-shipped loads. Long truck wait times and the risk of fines from local authorities add to the challenges.
5. Impacts on OEMs and Dealerships: OEMs face financial hits, including bloated inventories when vehicles can’t be located and compensation fees for undelivered vehicles. Dealerships suffer from disappointed customers, delayed revenue, and inventory that can’t be sold. Additionally, there are costs associated with “lot rot,” such as scratches, component degradation, and tire damage caused by prolonged storage.

How Real-Time Vehicle Visibility Addresses These Challenges

Having real-time visibility into vehicle location within vehicle processing centers can solve the challenges faced in the downstream finished vehicle supply chain in the following ways: 

Reduced Driver Workloads: Drivers can quickly and accurately locate their assigned vehicles, reducing the time and effort spent searching for vehicles and improving efficiency.

Decreased Yard Audits: With accurate real-time visibility, the need for frequent yard audits to locate vehicles is minimized, saving time and resources.

Reduced Short-Shipments and Penalties: Fewer vehicles will be reported as misplaced or lost, leading to quicker transporter loading, reduced short-shipments to dealerships, and fewer penalties. 

Shorter Transporter Lines and Fewer Fines: Quicker loading of transporters due to improved visibility will result in shorter lines and reduced detention fees paid by vehicle processing centers. Additionally, fines incurred by transporter companies for lining up on public roads can be minimized.

Improved Inventory Management: OEM inventories will be more accurate as vehicles can be easily located within the processing centers, reducing the risk of bloated inventories.

Enhanced Customer Satisfaction: End consumers will receive their desired vehicles promptly, improving their experience. Dealerships will have their full complement of vehicles available for sale, ensuring revenue generation.

Improved Working Conditions and Reduced Turnover: Drivers will benefit from precise location information, improving their working conditions and reducing turnover rates. This leads to cost savings in recruitment and training.

How do you achieve real-time vehicle visibility?

Real-time vehicle visibility is made possible by Cognosos’ RTLS. Our solution is powered by wireless, low-cost, GPS-enabled hardware tags. These tags capture the vehicle’s location whenever it is moved in the yard. The location information is then transmitted over a long-range wireless network, providing instant real-time updates.

Cognosos RTLS offers more reliable and accurate tracking than earlier technologies like barcodes and RFID. Additionally, a cloud-based application platform accompanies the Cognosos RTLS to transform tracking data into actionable intelligence, enabling managers to gain insights to boost efficiency and accelerate revenue. 

If you want to learn more about how real-time vehicle visibility can support advanced tracking for finished vehicle logistics, download our guide, “The Alignment Advantage: How to Improve FVL Efficiency and Profitability“.