A tier 1 automotive supplier faced complexity from nearshoring and the increasing costs of doing business. The company sought to reduce transportation costs while still meeting sustainability goals.
Utilizing its scale and end-to-end offerings for the automotive industry, C.H. Robinson executed advanced forecasting for strategic modal conversions, flexible truckload strategies, and continuous measurement based on data analytics methodology.
Improved technology utilization and advanced forecasting techniques helped to develop dynamic routing solutions, improved truckload utilization and routing, and enhanced efficiency that reduced emissions intensity by 55% and multi-million-dollar savings in transportation costs.
This automotive supplier is a long-term tier 1 premier supplier for the global automotive industry with expertise in powertrain design, development, testing and manufacturing. They have hundreds of manufacturing facilities worldwide, including many in North America. Their Mexico supply chain operation includes cross-border trucking between the U.S. Mexico, Canada, intra-Mexico, and shipments to OEMs across North America.
Before working with C.H. Robinson, the automotive supplier faced challenges in integrating their material and logistics planning processes. This limited their ability to improve trailer utilization, reduce network miles, report emissions reductions, receive at-risk shipment tracking notifications, gain visibility to part number and number of parts in the TMS system, and drive an overall continuous improvement methodology that reduces the cost of their transportation network.
With a transportation cost baseline established and agreed upon between C.H. Robinson and the supplier, primary cost saving targets were identified and phases to implement proposed cost savings solutions were developed. C.H. Robinson integrated to their ERP and began receiving and reviewing transactions in order to develop a route optimization methodology.
To maintain operational continuity during implementation, C.H. Robinson onboarded all current asset-based transportation, and broker-based lanes were immediately transitioned to our extensive brokerage network of reliable carriers. By redesigning operations and implementing short haul milk runs, transportation resources were better utilized, resulting in cost savings and emissions reductions.
Collaborating with the supplier, C.H. Robinson implemented flexible modal conversions and hybrid transportation models, including cross-dock and direct trailers. Also, by leveraging the auto train for intermodal transportation, we significantly reduced emissions while maintaining efficiency.
By optimizing transportation modes and routes and leveraging more fuel-efficient modes, hybrid models, and dynamic routing initiatives led to a substantial reduction in carbon emission output and intensity by 55%. Supplier collaboration, including milk runs and optimized load plans reduced total truckloads, and streamlined logistics operations, improving resource utilization further contributing to the company’s sustainability objectives.
During the implementation process, additional opportunities to improve the company’s supply chain in the future were identified, including exploring additional route and frequency optimizations, deeper technology integration, and leveraging the C.H. Robinson full suite of global services to maximize container utilization through buyer consolidation strategies. By continuing to innovate and collaborate, the automotive supplier can continue to provide best-in-class powertrain solutions to its customers and drive a cost efficient and streamlined supply chain.
Through strategic partnership and innovative solutions, the company successfully addressed key challenges within its supply chain amidst a complicated supply chain landscape in North America brought by the nearshoring trend, achieving significant cost savings, reducing environmental impact, and enhancing operational efficiency. By leveraging the supply chain expertise, modal conversions, dynamic routing, and technology utilization offered by C.H. Robinson, they optimized their transportation network while remaining agile in response to market dynamics. Looking ahead, the company is poised to capitalize on future opportunities, further solidifying its position as a leader in the automotive industry.