Inbound automotive supply chain challenges are endemic. Here’s how RTLS helps to overcome them.
Right now, upstream automotive supply chains are challenged: component shortages are widespread. The War in Ukraine, bottlenecks at ports, trade tensions, China’s COVID restrictions, tighter border security checks—plus, of course, the well-publicized scarcity of semiconductor chips.
But if upstream automotive supply chains are a mess, then it’s the downstream finished vehicle logistics supply chain that’s called upon to take the strain.
And that, in turn, is causing difficulties—often severe difficulties—in vehicle yards at assembly plants and downstream transshipment points.
Difficulties, in short, that materially impact productivity, cost, and capacity utilization.
From storage yards to accessorizing workplaces
Once, vehicle yards were simply places for storing inventory. Vehicles arrived and departed. But not any longer: vehicle yards are places where added-value post-assembly operations take place.
Because vehicle yards, it turns out, are a good place to carry out vehicle accessorizing—and with better results and more profitably than at the dealer. On the assembly line, tight TAKT
times (the assembly duration that is needed to match the demand) means that many accessorizing operations just don’t work from a cycle time point of view: with a 50-second TAKT time, for example, taking 20 minutes to fit a tow hitch would be impractical.
Not so at the yard, where highly skilled and experienced mechanics can fit multiple tow hitches and other such accessories in a shift.
The postponement paradigm
But that’s not all. A strategy known as ‘postponement’ is an increasingly common one in the automotive industry. Build a ‘core’ basic vehicle model, hold that model in inventory—and then customize it to customer requirements as close as possible to the point of dispatch.
Rightly, postponement is regarded as a ‘win-win-win’ strategy: the automotive industry holds less inventory, customer lead times are shorter, and dealers and automakers don’t have to discount inventory of vehicles variants that haven’t sold.
Yes, those different model variants and custom models for national or regional markets could all be built on the assembly line—but carrying out customization in vehicle yards instead often makes much more sense.
Retrofit eats space
Now factor in the impact of all that supply chain disruption. Sometimes, there’s not much that can be done — with certain component shortages, it makes no sense to build the vehicle for which they were intended.
But other times, it does make sense: it’s perfectly possible to build the vehicle, store it, and then retrofit the requisite component when it arrives.
Where to store it, though? The downstream finished vehicle yards make obvious sense—yards in which, conveniently, there are teams of experienced mechanics with just the skills needed in question.
There’s a problem, though. Most yards are congested already. Setting up specialist retrofit lines takes up scarce space: tents or prefabricated buildings in which the mechanics can work; a buffer of vehicles in order to make sure that those skilled (and expensive) mechanics always have vehicles on which to work; and nearby space in which to store containers of components awaiting fitting.
And remember: this is space that is in short supply already. Sure, moving vehicles around inside the yards can help to create space—but moving vehicles doesn’t add value. Creating buffers of vehicles for mechanics to work on doesn’t add value.
And, of course, fruitlessly hunting for misplaced vehicles in an already-congested yard doesn’t add value either.
How an RTLS can help overcome these challenges
So, what’s the answer?
In short, an effective real-time location system (RTLS). Because with an effective RTLS, a number of those problems simply go away, while others are reduced.
Take those inventory buffers of vehicles, awaiting accessorizing or retrofitting of components. With an effective RTLS, there’s no need to have large buffers of vehicles to ensure skilled mechanics always have vehicles to work on. Because when the drivers go to locate those vehicles, they’re right where they’re supposed to be.
Consider the space taken up by the storage of components and parts for accessorizing or retrofitting. Again, there’s an element of ‘just in case’ at work: components and parts are kept close at hand, because with vehicle location being problematic, it’s better to have parts and components to hand, so that mechanics can work on the vehicles that can be located.
Once more, with an effective RTLS, the problem simply goes away: instead of being fluid, mechanics’ work schedules can be relied upon to happen, with just the right parts and components marshaled and kitted in advance. Component and part inventories, in fact, can be located entirely off-site, and kitted from there.
But how realistic is the goal of having an effective RTLS?
Cognosos’ RTLS is powered by low-cost, wireless-equipped GPS- and Bluetooth-enabled tags, bringing employees sent to fetch vehicles within ten feet of the vehicle’s location—two or three parking spaces, in other words.
And vehicles’ locations are automatically updated, every time that a vehicle is moved from one location to another, thanks to the on-board accelerometers, which are triggered every time a vehicle is moved. So, with every move, the vehicle’s new location is captured. Paper-based updates are nowhere near as accurate.
It is, in short, simply a better RTLS—and a valuable ally in the challenges facing downstream automotive logistics vehicle yards. Vehicle yards often struggle for space—but right now, when yards are crammed full of vehicles awaiting retrofitting, space is at even more of a premium.
And with a truly effective RTLS, the fight to claw back that space begins.
To learn more about how next generation RTLS technology can support advanced tracking for vehicle logistics, download the eBook, “Productivity Gains in Real Time: Unlocking ROI in Vehicle Logistics Tracking Solutions.”