How automotive supply chains become more resilient by sharing risk.

CHEP’s share & reuse global pool is helping manufacturers and suppliers stay competitive in a disruptive world by giving them more flexibility with less risk.

Automotive supply chains are among the most complex on earth, with each vehicle containing up to 20,000 parts originating from thousands of different suppliers located in different parts of the world.

These supply chains are now facing huge disruption. Not just from the short and long term effects of the Covid pandemic, but also from a move away from carbon powertrains, the rise of environmental legislation, and the impact of political events like Brexit. The future of the whole automotive value chain is uncertain, with different possibilities leading to very different outcomes. [Footnote 1]

Such shifting and complex dynamics mean that supply chains need to add “just in case” to their “just in time” model to continue to competitively satisfy consumer and manufacturer demand in the future. This means building the ability to deal with uncertainty and change into the process, so that their supply chain becomes as resilient as needed, without adding unnecessary waste, cost and inefficiency.

Packaging and transport of components is a key area in these interdependent supply chains. The right packaging needs to be always available when demand is unpredictable. Product damage and returns must be reduced by keeping packaging quality consistently high. And transport efficiencies maximised, so that goods are delivered on time, whatever the circumstances.

Working with CHEP’s global share & reuse packaging pool gives a single-partner solution that outsources risk and increases flexibility all along the supply chain.

The scale of CHEP’s network and assets, with over 330m pallets and containers in circulation, mean that supply is always guaranteed on a pay-by-use basis. With no need for dedicated packaging warehousing, repair, transport and management, companies are free to change demand or change direction whenever they like.

Murray Gilder, VP CHEP Automotive & Industrial Solutions says: “Moving automotive parts across borders comes with its own risks and inefficiencies. Uncertain times can intensify the pressure on supply chain players. Packaging management is one of the key areas that you can create cost-efficient operational robustness to protect yourself against disruptions.”

Footnote 1: Deloitte ‘Future of the automotive value chain’ report: https://www2.deloitte.com/content/dam/Deloitte/us/Documents/consumer-business/us-cb-future-of-the-automotive-supplier-industry-outlook.pdf