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Stuart Warren, CAT Group on 'The Reality of Network Realignment & Rate Negotiations with Carriers'
 

Stuart Warren, CAT Group on 'The Reality of Network Realignment & Rate Negotiations with Carriers'

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Stuart Warren, Regional Director for UK, Benelux and South Africa for CAT Group speaks at a session on 'The Reality of Network Realignment & Rate Negotiations with Carriers' at the 7th European 3PL ...

Stuart Warren, Regional Director for UK, Benelux and South Africa for CAT Group speaks at a session on 'The Reality of Network Realignment & Rate Negotiations with Carriers' at the 7th European 3PL Summit in Brussels, November 25th 2009.

To download all of the slides from the conference for free visit www.3PLsummit.com/eu_2009ppts

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    Stuart Warren, CAT Group on 'The Reality of Network Realignment & Rate Negotiations with Carriers' Stuart Warren, CAT Group on 'The Reality of Network Realignment & Rate Negotiations with Carriers' Presentation Transcript

    • CAT Group Vehicle Logistics European Network Re-Engineering 2009 Stuart Warren European 3PL Summit, Brussels, 25/11/2009 30 novembre 2009 1
    • Evolution born from Crisis Clever CAT! Adapting Quickly to new Environment 30 novembre 2009 2
    • CAT Group Vehicle Logistics, Key Figures CAT Group Cargo Logistics • €743 million turnover • 1,903 employees • 116 Distribution centres • 2,200,000 new vehicles delivered, • 65,000 High & Heavy vehicles Sea 11 % Rail 11 % Road 77 % Barge 1 % 30 novembre 2009 3
    • W. European Network (simplified) Newcastle Teesport Luton Zeebrugge Southampton Le Havre Santander Palencia Valladolid Barcelone 30 novembre 2009 4
    • Situation Europe: December 2008 GLOBAL VOLUME TREND VOLUME TREND IMPACTING EQUILIBRIUMS Volume per month Budget 2008 vs Nov 08 Forecast 180 000 25 000 160 000 Spain 140 000 20 000 120 000 100 000 15 000 80 000 60 000 10 000 40 000 20 000 5 000 0 r e er e ril e e in ût t ie ai s ille br br br br ar i av ju m vr ao nv m m em to m ju 0 fé ja ve ce oc pt no dé 1 2 3 4 5 6 7 8 9 10 11 12 se Budget 08 PFMT 1 08 1 Budget 08 PFMT 1 08 1 PFMT 1 09 1 Linéaire (Budget 08) Linéaire (PFMT 1 08) 1 Rotation France Allemagne Bénélux Pologne <> Espagne - Ratio Montée / Descente 7,0 6,0 5,0 4,0 3,0 2,0 1,0 0,0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 PREV 2008 (CP06 2007) REEL 2008 (CP11 2008) PREV 2009 (CP11 2009) 30 novembre 2009 5
    • 5 main Pillars of our Network were shaken I Imbalanced Flows Eg : No backload for 70 trucks / Newcastle week, France Spain Teesport Luton Lack of sustainable volume Zeebrugge Southampton Le Havre II on « road-relays » More than 50% of 120 relay We had to adapt ! Santander Palencia Valladolid Barcelone dismantled III Lack of volume to feed full trains 3 to 4 trains / week out of 20 I II III IV V IV Too low volume on existing Fixed “road-relay” links Commit with suppliers Short-Sea routes Short Sea Shipping <700 car /w on UK-France-Spain Road roundtrips route versus current 1200 Rail Transport V No respect of annual volumes committed with suppliers 30 novembre 2009 6
    • Key elements to restore network efficiency • Reduction of number of centre used France • Increased Direct Delivery • Domestic Rail transport limited • Direct Distribution increase • Reduction of number of centre used • Direct Delivery from Spanish factories • Limitation of number of capillary Spain • 2 new compounds to be used (on outside centres (reduced by 7) Spain and one in the South) • Increased Trans-border deliveries • New flows via Civitavechia/Fiumicino • Empty mileage reduction through • Distribution from our French compounds Italy roundtrips reengineering • Approaches by Rail to Vercelli replaced by road • Selection of new suppliers based • Direct delivery from some French factories on CAT Global Tender responses & (not implementable yet) on QCD Germany • Areas distributed by final compounds have • Integration of logistics opportunities been re optimized drawn from the Tender • Direct delivery from French factories. Benelux • Direct distribution from Zeebrugge and Antwerp for short sea imports 7 7 30 novembre 2009 7
    • Illustration of changes: Slovenia => France Before New Network : •a significant increase of Direct Delivery Quality : 4% => 2% Time Cost : savings over 5% minus > 2 days 30 novembre 2009 8
    • European tender • In late 2008, CAT already in final rounds of major European tender • Prices quoted re-analysed in light of new network 1st RFP 2nd RFP Contracting Supplier Launch Due date Launch Due date Negotiations Event 1st selection of 2nd selection of Start best suppliers best suppliers Phased Number of suppliers involved in tender implementation of new network starting Q4 2008 30 novembre 2009 9
    • European Supply Base 479 • 138 • 128 • 65 • 58 • 45 45 Invited • France, • North • Spain & • Italy • South • Germany suppliers* Belgium & Eastern Portugal Eastern Switzer- Europe Europe land 30 novembre 2009 10
    • Implementation – Further Impacts • Empty km: •significant reduction •Suppliers • Uncertainty • Changes • Closure of Distribution Centres • Significant reduction of volumes in other centres • Opening of new centres with IT links • Social Impacts: • Redundancies • New jobs – different locations • Value-Add Services • Changes to PDI points 30 novembre 2009 11
    • Conclusion Thank You for your attention! 30 novembre 2009 12