Volvo Group Trucks

KNEG - Resultatkonferens 2013
Stockholm
Samverkan mellan aktörer –
Effektiva & Hållbara intermodala transporter
Volvo Group Trucks
Does a manufacturer of commercial
vehicles develop intermodal
solutions and utilize different modes
of transport?
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
2
2013-10-21
European challenge
“The transport sector is crucial to
the competitiveness of the EU.
We need a long-term plan about
how to develop sustainable and
efficient transport.
Volvo is in favour of
strengthening and combining all
the different modes of
transport……..”
Leif Johansson, Former CEO, Volvo Group
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
3
2013-10-21
Strategical ”backbones” –
Intermodal highways
•  Background
Umeå –  Strategical decision within the Volvo Group to use
different modes of transport in order to secure
capacity, competitiveness and sustainability.
•  Eurobridge
Hallsberg –  Short Sea concept connecting Sweden<>
Belgium
Göteborg Malmö •  Train 8
Stockholm Älmhult Olofström –  Rail concept connecting Sweden<>Belgium
•  Viking Rail
–  Rail concept connecting Sweden<>Germany
Hannover Gent = Volvo final assembly plants Kornwestheim Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
4
2013-10-21
= Volvo component plants = Consolida5on points [rail] Train 8 – Existing
logistics concept
•  Volvo Cars Olofström à Volvo Cars Gothenburg
– 
10 trains/week to/from Gothenburg
– 
50 SGNSS wagons, 150 containers per day
– 
316 km, 6 hrs transport time
•  Volvo Cars Olofström à Volvo Cars Gent
– 
12 trains/week to/from Gent (combined in Älmhult/VTC)
– 
40 SGNSS wagons, 102 containers per day
– 
1300 km, 24 hrs transport time
•  Volvo Trucks Umeå à Volvo Trucks Gothenburg
– 
5 trains/week to/from Gothenburg
– 
10 Multipurpose wagons, 120 cabins per day
– 
983 km, 20 hrs transport time, sequence of cabins
– 
Re-loading of finished vehicles Gothenburg à Umeå
•  Volvo Trucks Umeå à Volvo Trucks Gent
– 
12 trains/week to/from Gent (combined in Älmhult/VCC)
– 
12 Multipurpose wagons, 144 cabins per day
– 
1 Mega-Twin wagon, 2 mega trailers per day
– 
2500 km, 48 hrs (56 hrs) trp time, sequence of cabins
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
5
2013-10-21
Viking Rail – Existing
logistics concept
•  Developed 2006-2008. Implemented October 2008
•  ~40% of Volvo Group & Volvo Cars volumes from
Germany to Sweden transferred from road to rail
•  Block train: Hannover <> Gothenburg
–  1 block train per day to/from Gothenburg
–  18 Mega-Twin wagons, 36 mega trailers/day
–  1074 km, 18 hrs transport time
•  Single wagons: Kornwestheim <> Hannover
–  1 train per day to/from Hannover
–  6 Mega-Twin wagons,12 mega trailers/day
–  498 km, 6 hrs transport time
–  Automotive RailNet used [combined with
production material for the Daimler Group]
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
6
2013-10-21
CO2 savings - Train 8 & Viking Rail vs road
The annual CO2 saving in using
rail set ups Train8 and Viking
Rail equals driving around the
earth 74 times…
CO2
Total CO2 saving
103 606 771 kg
CO2
Road setup
110 146 989 kg CO2
Driving 30 km to work
17 921 946 times...
.. or a yearly consumption
of household electricity
for 167 108 villas
Viking Rail and Train8
6 540 218 kg CO2
Note: CO2 savings are on an annual level and calculated on volume base for 2013
Compiled by Eva Kristoffersen, Quality & Environment Improvement Manager
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
7
2013-10-21
Collaboration; Viking Rail
Develop an intermodal solution between Germany<>Sweden
•  Challenge/Opportunity
– 
Volvo Group’s objective: Develop an intermodal solution
between Germany and Sweden in 2006
– 
Solve imbalance in Volvo Group’s flow (15% in return
flows) in order to create positive business case
•  Solution
– 
Volvo Group invited potential road carriers for pre- and
on-carriage to a partnership
– 
Volvo Group is selling trailer slots SB to Ewals & Rhenus
– 
Northbound: 100% Volvo cargo
– 
Southbound: 15% Volvo cargo and 75% 3rd party cargo
•  Result
– 
Annual CO2 saving: 15 182 ton per year
– 
Intermodal solution implemented 2008
– 
Volvo Group transferred ~40% of the total Inbound
volume from Germany to Sweden from road to rail
– 
Nominated road carriers could develop an intermodal
strategy/product for third party customers
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
8
2013-10-21
Collaboration; Train 8
Reduce imbalances in the domestic transport corridor
•  Challenge/Opportunity
– 
Volvo Group; Empty transportation Gothenburg à Umeå
– 
Autolink; Empty transportation Umeå à Gothenburg
– 
Same wagon type used by both parties
•  Solution
– 
Cooperation established 2013 between Volvo Group,
Autolink and Green Cargo
– 
Re-loading of finished vehicles from Gotheburg to Umeå
– 
Volvo Groups Multipurpose wagons used
•  Result
– 
Annual CO2 saving: 357 ton per year
– 
Increased wagon utilization northbound by +20%
– 
Reduced transportation costs
– 
Increased utilization at Volvo Groups combi terminal
– 
Reduced lead-time [Autolink/OEMs]
– 
Increased punctuality [Autolink/OEMs]
– 
Reduced financial risk [Autolink/OEMs]
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
9
2013-10-21
Collaboration; Train 8 and Viking Rail
Securing high quality, punctuality and deviation handling
•  Challenge/Opportunities
– 
Keep Volvo cargo on rail by securing high quality,
punctuality and deviation handling in the international
transport corridor
•  Solution
– 
Partner meetings are held 2-3 times per year
– 
Agenda topics (exampels):
• 
Punctuality follow-up
• 
Deviation process, Back-up solutions
• 
Volvo Desk, Information flow, Quality handbook
• 
Web based track & trace, GPS & RFID
• 
Root cause analysis for delays & improvement areas
•  Result
– 
Keep annual CO2 saving: 103 607 ton per year
– 
Improved quality & punctuality
– 
Improved collaboration & communication
– 
Improved deviation process & internal processes
– 
Creates responsibility and commitment
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
10
2013-10-21
Infrastructure
managers
Success factors [Volvo Group experience]
Collaboration à Efficient & Sustainable intermodal solutions
•  Develop a long term sourcing strategy, i.e contract length, size of carrier company, asset owner,
forwarder etc
•  Involve carriers early in the development of your supply chain - commercial and operational
•  Create an open, honest and transparent dialogue with carriers & collaboration partners
•  Collaborate with OEMs, forwarders or carriers in order to find the necessary volumes, balances and
frequencies that secure your needs and mimimize empty running
•  Collaborate with partners/customers with different leadtime demands which can be combined in the
same set-up
•  Create business models where all parties share opportunities and risks
•  Explain the background and reasons for your needs/demands for all involved parties – it creates
commitment, responsibility and understanding of effects in case of deviations
à OEMs and carriers need to work together in order to secure high filling degree, share filling
degree risks and achieve daily frequency.
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
11
2013-10-21
The EIA Intermodal Award, 2005 “Best integration of intermodalism
into a shippers’ logistics
chain” [Eurobridge & Train 8]
The Big Transport & Logistics
Award, 2009 - “Innovation of the
year - Railfreight”
[Viking Rail]
Bra-Miljöval, 2006
Klimatintyg, 2007-2013
[Volvo domestic rail set-ups]
Thank you for your attention!
Volvo Group Trucks Operations
Logistics Purchasing, Commodity Sea & Rail, Anders Bergström
12
2013-10-21