Kicking the habit: new approaches to tire logistics
- Stringent processes and close collaboration are the best ways to ensure the integrity and quality of delicate and valuable goods.
- Tire technology is becoming more sophisticated, e.g. sensing pressure and tread depth with real-time measurements.
- Agility and adaptability are going to become essential in the global auto-mobility supply chain
Talking with our customers in the tire industry, it’s clear that tire manufacturers and distributors around the world operate in a distinct subsector that is experiencing its own specific set of challenges. High volatility, downward price pressure, and the need to compete effectively with new entrants in attractive emerging markets are the key challenges of today. There is no benefit in continuing with old habits, doing things the way they’ve always been done. Now is the time to seek out new approaches to tire logistics.
The need for sensitivity
Moving tires within a warehouse can be highly challenging. They take up a lot of space and can be extremely heavy, particularly industrial and agricultural tires. Often tires require some level of climate control and, due to their strong smell, they usually cannot be stored and transported in close proximity to other items of freight.
Let’s not forget that, in addition, premium tires require very special handling to avoid damage and yet most tires experience a rough ride from manufacturer to final destination. Sensitive handling can be achieved, of course. For example, technology companies regularly transport and store semiconductors – arguably one of the most brittle, high-value substances in the world – along some of the longest supply chains. Semiconductors are typically manufactured in specialist plants and then, because they are an essential ingredient in most electronic circuits, they are shipped to all four corners of the earth to be stored and used in a huge variety of industrial and consumer products. Stringent processes and close collaboration are the best ways to ensure the integrity and quality of delicate and valuable goods, from the tiniest silicon wafer right up to a $1,500 premium tire.
Reverse logistics is becoming more and more important in a world that values environmental protection, as evidenced by the 5,000 delegates who attend the annual Michelin Movin’On Summit. Today, the focus goes way beyond shipping new tire products to customer destinations; now it is also essential to address the return journey. Stakeholders require processes and networks to transport faulty and used tire products back for repair, reuse, recycling and ultimately for responsible end-of-life disposal.
Tire logistics can learn a lot from e-battery logistics as, from outset, the electric vehicle industry has had to provide reverse logistics for lithium-ion batteries. Often there are many moving parts to this type of supply chain – many different partners providing a wide variety of services and each operating with specific challenges and requirements. Sustainable logistics solutions are worth this effort, however, particularly as so many organizations are aiming to achieve ambitious carbon-reduction goals in the coming years.
Agility and adaptability
In future, much more technology is likely to impact the tire industry. Already there are many examples of industry convergence between the auto-mobility and technology sectors. Tires are becoming smarter, sensing their own pressure and tread depth with real-time measurements. This information can be immediately analyzed to provide unique insights about tire wear based on vehicle, geography, and conditions and this, in turn, will transform the efficiency of tire design and use. It’s quite possible that data will help to improve tread patterns to enhance traction, and that the size and shape of future tires may change for passenger comfort, noise reduction, fuel efficiency, and more.
Indeed as vehicles become smarter they will need connected tires that are capable of talking to each other and to their surroundings and infrastructure. As we move towards autonomous mobility, there will no longer be drivers to check the tires or even give them a cursory kick! Instead we will rely on data to keep us safe.
Agility and adaptability are going to become essential in the supply chain. As tire products get more complex, so too does the global auto-mobility supply chain. Staying flexible is the effective response to this growing complexity, optimizing current operations while remaining sufficiently adaptable and scalable to meet future demand spikes. End-to-end shipment of production materials such as synthetic rubber and of finished tire products requires strengths in freight forwarding, warehousing, customs clearance, and IoT tracking to support rapid volume increases particularly in China, the European Union, Japan and the United States.
Tomorrow’s supply chain will need to deliver cost optimization, shorter order-to-delivery cycles, and much more. And that will require tire companies to collaborate closely with their logistics service provider to imagine and implement powerful new approaches to tire logistics. Do you agree with this and would you contribute your thoughts to the conversation?
Published: December 2020