RFiD data can be collated instantaneously as trucks drive through gates which are effectively wireless receivers. Passive RFiD requires individual scanning. These two systems are clearly incompatible with each other. However 40% of the companies supplying the parts are expected to support both formats leading to an increased cost being passed along the supply chain. Jonty’s ‘Why Change’ argument was led by cost considerations such as these. He also identified the increasing knowledge in the car making industry of how the logistics companies make their profits, he cited an interesting case in point where two companies are both charged 60% of the cost of the transport. One company pays 60% for the delivery of the goods and another company pays the same for use of the capacity on the return journey. Jonty identified this immediate 20% profit as one of the targets for elimination within the industry. Overall he summarised that the logistics industry as a whole will need less capacity in the future than it has now. Primarily he believes this will be achieved by better utilisation of capacity. This exploits reverse supply chain logistics where the return journey capacity is better utilised.

The last to the podium was Richard Marlow of Honda UK manufacturing who briefly summarised the aspirations of Honda to increase both two-wheel and four-wheel production by approximately 10% per annum. Total vehicle output from Honda should therefore increase from the present 22.6 million to a total of 30 million by 2010. This does however include all vehicle configurations – even the humble lawn mower. The logistical challenge facing Honda is thus clear but also includes expansion into the manufacturing industries of developing nations including the Russian Federation.

Following these three presentations Maxine Elkin invited questions from the floor. One question regarding the use of rail in the future development of logistics was discussed at length with the following conclusions: Whilst rail presents a path to a reduced carbon footprint the following issues were identified as obstacles to its implementation;

According to Jonty Cook it is difficult to find a company that will sell rail capacity and that the rail companies tend towards monopolistic practices. In addition the investment required is staggering and these three issues rule out the use of rail for

outbound logistics. The same issues apply equally to inbound logistics for the supply of parts but is compounded by the additional killer issue of a lack of reliability. The example of forecast variations damaging any rail based logistical plan. The requirements of the modern logistics industry  simply cannot cope with these levels of disruption.

Paul Dyer agreed with these points and elaborated on DHL’s plan for rail based logistics. Fundamentally, DHL will consider small scale rail transportation to avoid the worst congested parts of the UK only on runs that extend the length of the country. Across borders DHL will be commencing a logistics rail link of two trains per week to transport cars from the UK to Belgium. Given the limited usefulness of rail based logistics DHL will consider rail solutions from sea ports only in the future. Hondas view point largely echoes with previous comments though there was greater evidence of rail utilisation in their case. Amongst other questions

raised was the use of night time transports as a means of reducing carbon footprint. According to the panelists general figures for the ratio of goods transported in the day compared with that in the night time was approximately four to one. The traditional working day tends to yield finished products for transport at the end of the day. An interesting note to suppliers, car makers like Honda prefer 24 hour working in their supply chain for this reason. In fact this could sway their choice of supplier if night time deliveries are possible.

Finally the panellists were asked about the achievement of better utilisation through the commonisation of packaging. Fundamentally part sizes are different and therefore require variations in packaging in order to protect them. However the clear advantage of tessellating universally sized packaging is a clear route towards better utilisation. To this end Jaguar and Land Rover have taken on this seemingly impossible mission in the last three years achieving a reduction from 2500 to 1900 unique packaging sizes and a ten fold reduction to 20 commonised solutions. According to Jonty Cook “it would be easier to work towards World Peace” than to achieve fully a commonisation of packaging.

Our Thanks to the Tyne and Wear Development Corporation for  the evening’s entertainment at Sunderland’s Theatre of Glass
pictured opposite .