As vehicle manufacturers make the transition to new generation vehicles, the demands they make of their tier suppliers have become increasingly complex. This in turn requires suppliers’ own supply chains to be ever more flexible and responsive.
Tier suppliers face similar pressures to OEMs. While the bill of material for new generation vehicles has become much more streamlined, tier suppliers must still maintain the legacy SKUs for the aftermarket. So, in addition to running ‘business as usual’, high levels of investment are required in terms of re-tooling and new machinery to cater for the future. This can put a strain on cash flow.
The need for speed, flexibility and reliability, as well as cost consciousness have not gone away, as both inbound and outbound logistics processes are having to adapt to this new era.
At Kuehne+Nagel automotive logistics is part of our DNA, so we intuitively understand the competing priorities facing tier suppliers. In this situation bigger is definitely better, as tier suppliers are able to take advantage of our global network and purchasing power with freight carriers to competitively run their businesses. Our broad portfolio of solutions allows tier suppliers to effectively respond to changing requirements either up or down the supply chain.
Not only are we helping tier suppliers transition to new generation vehicles to ensure a sustainable future, but we’ve made a true commitment to net zero carbon ourselves with a huge investment in digital supply chain solutions. We also plan to achieve carbon neutrality for our suppliers’ and customers’ footprint by end 2030.
Contact our tier supplier experts today to learn more about how Kuehne+Nagel can support your business success.