New Mercedes-Benz Consolidation Center opens in Speyer 16.07.2015: - Mercedes-Benz Cars Sets Course for Growth and Efficiency in its Global Logistics Operations

- Mercedes-Benz Cars Sets Course for Growth and Efficiency in its Global Logistics Operations



Grand opening of the Mercedes-Benz Consolidation Center in Speyer, Germany, July 16, 2015 (left to right): Hansjörg Eger, Mayor, city of Speyer, Alexander Koesling, Head of Supply Chain Management Mercedes-Benz Cars, Malu Dreyer, Premier of Rhineland-Palatinate, Markus Schäfer, Member of the Divisional Board of Mercedes-Benz Cars, Production and Supply Chain Management, Michael Neumann, President Automotive, syncreon International Group .



    Next step in the strategic realignment of Mercedes-Benz Cars focuses on worldwide logistics – central responsibility for efficient and flexible management

    Several hundred million euros to be invested over the next years in the strategic realignment of logistics operations

    New Consolidation Center in Speyer is an exemplary strategic investment


    Markus Schäfer, member of the Divisional Board of Mercedes-Benz Cars, Production and Supply Chain Management: “Logistics plays a key role for our company’s success. Our objective is to gear our Supply Chain Management organization towards growth and to make it even more efficient and flexible. This approach marks the next logical step in our global production strategy.”


    Alexander Koesling, Head of Supply Chain Management at Mercedes-Benz Cars: “We create the necessary conditions for on-time production at our plants. Our investment of several hundred million euros in our Supply Chain Management organization will optimize logistics throughout our global production networks. By reducing our logistics costs per vehicle we will improve our competitiveness, since logistics have a major impact on our overall cost position.”



The Mercedes-Benz Cars division is taking the next step in its strategic realignment process by investing a high three digits million amount in its global logistics organization. In line with the “Mercedes-Benz 2020” growth strategy, Mercedes-Benz Cars is expanding its global production and supplier network close to customers and markets.


The increasingly complex incoming production material flows at Mercedes-Benz plants and the transport of newly manufactured vehicles from production facilities will be centrally managed in an even more efficient and flexible manner. “Logistics plays a key role for our company’s success.


Our objective is to gear our Supply Chain Management organization towards growth and to make it even more efficient and flexible. This approach marks the next logical step in our global production strategy,” says Markus Schäfer, member of the Divisional Board of Mercedes-Benz Cars, Production and Supply Chain Management.


The focus will be on securing the supply of materials in the global production networks, reducing inventories, ensuring on-time deliveries of new vehicles to customers around the world, and incorporating the logistics organization into the continuous advancement of the global production network at an early stage.


The new strategic approach for the Supply Chain Management organization was presented on the occasion of the grand opening of the new Mercedes-Benz Consolidation Center in Speyer in the Southwest of Germany.


Such consolidation centers play an important role in Mercedes-Benz Cars’ logistics strategy in terms of ensuring the supply of materials used at the division’s plants around the world. The opening ceremony of the new center was attended by the Premier of Rhineland-Palatinate, Malu Dreyer, and around 200 other guests from politics, industry, and administration.


The global Supply Chain Management unit has been integrated into the central production organization at Mercedes-Benz Cars (MO). It reports directly to Divisional Board member Markus Schäfer and is managed by Alexander Koesling, Head of Supply Chain Management at Mercedes-Benz Cars. The unit’s responsibilities include


    planning and managing the global production program,


    ensuring the production capability of Mercedes-Benz Cars locations through the delivery of required materials -  including on-time deliveries of supplied parts and components from suppliers and MBC facilities to the target plants (inbound logistics),


    securing the supply of materials and material flows to the stations where the parts and components are installed within Mercedes-Benz Cars vehicle and powertrain plants (intralogistics),


    and managing the global transport of new vehicles from manufacturing plants to customers around the world (outbound logistics).





The Supply Chain Management organization at Mercedes-Benz Cars directly employs nearly 7,500 men and women, as well as numerous service providers for logistics and transport. “We create the necessary conditions for on-time production at our plants.


Our investment of several hundred million euros in our Supply Chain Management organization will optimize logistics throughout our global production networks. By reducing our logistics costs per vehicle we will improve our competitiveness, since logistics have a major impact on our overall cost position,” says Alexander Koesling.


In terms of inbound logistics the planned increase of unit volumes at Mercedes-Benz Cars will lead to a significant expansion of merchandise flows throughout the global production network, especially at plants outside of Germany. The increasing product complexity resulting from a larger number of engine versions and personal customization options, for example, are putting an additional strain on logistics operations.


The new Consolidation Center in Speyer represents a perfect example of a strategic investment in a new facility operated by highly specialized logistics service providers. These providers will consolidate supplier shipments in an optimal manner to ensure deliveries to the three major Mercedes-Benz Cars plants abroad - in China, the U.S., and South Africa.


The setup of similar consolidation centers in the upcoming years is being considered, especially in growth regions like China and NAFTA. This new strategic approach is a result of the growing demand for local suppliers in these regions and the increasingly strategic employment of regional suppliers for global deliveries of production materials.


Measures related to intralogistics focus on the intelligent optimization of material flows in production plants - from material deliveries to component installation in vehicles. Such optimization begins at an early stage with logistics and load carrier planning, which have a major impact on inbound logistics freight costs.


The continual modularization and standardization of production processes is accompanied by the use of state-of-the-art digital transformation approaches resulting from Industry 4.0. These include wireless real time monitoring of materials and empty packaging, support from big data cockpits for the planning, monitoring and control of processes, and largely automated driverless transport systems.


The Mercedes-Benz plant in Kecskemét, Hungary, for example, is currently implementing a pioneering project in which materials used in the final assembly area are exclusively brought to the line in prepackaged baskets by driverless transportation systems (DTSs).


This not only eliminates the need for workers to go get the materials themselves: A look into the baskets is sufficient to determine if all components have been installed - yet another simple and effective way to improve quality assurance.


Activities in the area of outbound logistics revolve around the realignment of the global transport network in order to prepare it for the significant increase in unit volumes at plants around the world, and thus ensure the flexible, damage-free, and efficient delivery of vehicles to customers everywhere. A key strategic project in this area was recently given the green light.


 It involves the construction of a new network hub at a port in the Adriatic Sea that will be used to ship vehicles to Asia. Other measures include the systematic use and further development of a reference calculation method for the allocation of transportation services, much in the same way this has been done successfully with production material procurement.


About the Mercedes-Benz Consolidation Center in Speyer

The new Consolidation Center in Speyer consolidates production materials from European suppliers and initiates the transportation to the major car production plants operated abroad by Mercedes-Benz in China, the U.S., and South Africa. A total of approximately 90 million euros was invested in the facility, which is now being gradually brought up to full capacity.


 When it becomes fully operational in 2016, the center will ship several hundred sea containers every week via inland waterways or rail to Antwerp and Bremerhaven, where they will be loaded onto freighters and transported to Beijing (China), Tuscaloosa (U.S.), and East London (South Africa).


Up until now, logistics service providers in Bremen were solely responsible for managing shipments of materials from German and European suppliers to the major Mercedes-Benz plants abroad. Thanks to the new consolidation center in southwestern Germany, deliveries from European suppliers south of the Main River will no longer have to be shipped over long distances, which will significantly reduce the logistics costs.


This, along with the direct links between the center and the ports via inland waterways and rail lines, will lower relevant CO2 emissions by more than 25 percent. After intense examination, Daimler chose Speyer for the new center because of the available space and the geographic location.




The Consolidation Center Speyer was planned according to the requirements of Mercedes-Benz Cars and designed in a way that ensures all processes can be carried out very efficiently and safely - for example, by keeping pedestrians, trucks, and reach stackers (vehicles for loading and unloading containers) separate from one another.


The center, which is located at a site with a total area of 251,000 square meters, extends over a distance of one kilometer and has around 79,000 square meters of hall space. In addition, the center includes a roughly 21,000-square meter container yard and an administrative building.


A team from Mercedes-Benz Cars Supply Chain Management is responsible for the overall operation of the facility. The operational logistics at the Consolidation Center - the transshipment of supplier materials from trucks to containers - is managed by the global logistics company syncreon, which employs around 400 people in its onsite operational material transshipment and administrative units.


The specialist transport company Contargo, in turn, is responsible for transferring sea containers to trucks and then transporting the containers to inland waterway or rail transshipment centers.




About Mercedes-Benz Cars Operations


Mercedes-Benz Cars Operations is responsible for passenger car production at 26 locations around the world as part of a flexible and efficient production network involving more than 70,000 employees. This includes the central functions of planning, logistics, and quality. Mercedes-Benz Cars produced more than 1,754,000 Mercedes-Benz and smart passenger cars last year, marking the fourth record in a row.


The network is based on the product architectures of front-wheel drive (compact cars) and rear-wheel drive (for example the S-Class, E-Class, and C-Class) as well as the SUV and sports car architectures. In addition, there is a powertrain production network (engines, transmissions, axles and components). Each of these production networks is grouped around a lead plant that serves as a center of competence for the ramp-up of new products, technology and quality assurance.


The focus of day-to-day work is on the continuous improvement and refinement of state-of-the-art production methods, which allow future high-tech vehicles to be produced in a way that is efficient, flexible and environmentally friendly, according to the typical Mercedes-Benz quality standards.


All of this revolves around the employees and their expertise, whose work is systematically supported by ergonomic workplace design and intelligent automation. In addition to its own production plants, Mercedes-Benz is increasingly leveraging partnerships and utilizing capacities at contract manufacturers as part of its growth strategy.

        
    
Sebastian Wahle - photos Mercedes