Automakers the world round are under intense pressure to produce environmentally sustainable vehicles, even as they struggle with the complexities of managing global supply chains. 

Among the industry’s biggest challenges is the need to adopt innovative technologies that can enable the real-time visibility needed to optimize the transportation of parts and components from suppliers to the plants. 

Over the years, manufacturers in multiple industries have embraced supply chain “control towers” to oversee their logistics operations. Now, Renault Group is bringing that concept to the automotive sector. 

The French multinational manufacturer has a presence in more than 130 countries, selling 2.1 million vehicles in 2022. In addition to the Renault nameplate, its brands include Dacia, Alpine and Mobilize. The group also operates in an alliance with Nissan and Mitsubishi Motors. 

By its very nature, an enterprise of that size and scope is subject to serious inefficiencies, especially when real-time visibility over the entire operation is lacking. That was the dilemma facing Renault in 2020, when the automaker found itself encumbered by too many manual processes for determining transportation dwell times and coordinating dock scheduling. 

The resulting lack of visibility was driving up costs, in part because of a need for expedited deliveries to make up for late or missed loadings. In addition, Renault couldn’t easily track spot orders or identify where delivery and loading times weren’t being met. What’s more, without objective data at hand, it had no way to ensure that carrier expenses were justified, and payments fair. 

Renault attacked the problem through a couple of partnerships and technology acquisitions. In 2021, it launched a strategic plan dubbed Renaulution, with the aim of becoming a major player in the tech sector. The goal was to boost customer satisfaction by shortening delivery times, while simultaneously reducing inventory and logistics expense, and bolstering overall supply chain resilience. 

The project sought to optimize the management of Renault’s parts flows through the reconciliation of logistics and production data. Key elements included: 

• Development of internal software; 

• Development of applications delivered under the software-as-a-service (SaaS) model; 

• Deployment of physical operating infrastructure in the form of a control room, and 

• Change management in partnership with the automaker’s plants and carriers. 

In 2020, Renault teamed up with Shippeo, a provider of software for multimodal transportation visibility, along with Google’s artificial intelligence model, to create the first control tower for the automotive industry in Europe. The application employs AI modules fed by real-time traceability data from logistics providers and production stock, along with other sources of news. The resulting support tool gave operational teams end-to-end coverage of operations on a global basis. 

By the first half of 2021, 80 of Renault’s carriers had connected to Shippeo’s transportation visibility platform. The first version of the control tower for inbound deliveries went live in October of 2022, covering parts transportation by truck throughout Europe, the Middle East and North Africa. Outbound carriers were added shortly thereafter. As of January 2023, Renault had also integrated the tracking of 100% of its maritime transport services. 

The control tower allows for a real-time link between parts transportation and vehicle production. Drawing on AI and machine learning from Google, the system calculates accurate estimated times of arrival, accounting for variables such as weather, strikes, border-crossing delays and traffic levels. The analysis helps it to detect potential disruptions early on, sharpening Renault’s crisis-management strategies and making possible mitigating efforts such as truck rerouting and acceleration, and transshipment of critical parts. 

According to the automaker, the Shippeo application has led to “remarkable enhancements” in service levels for the transportation of parts from suppliers to the plants, while also improving safety and fostering global collaboration with supply chain partners. Tracking accuracy is based on a detailed analysis of GPS data, and weekly animation of the automaker’s 10 major carriers in the European region. At the factory, the tool has taken 15 minutes out of an average waiting time of 90 minutes for trucks, Renault added. 

Better visibility is also helping Renault to meet sustainability targets in its push to achieve carbon neutrality in Europe by 2040, the company said. 

Jean-François Salles, global vice president of supply chain with Renault Group, said the control tower “is helping us to be more efficient, cost-effective and [able to] provide more consistent service levels for our customers, with timely predictions and just-in-time recommendations to mitigate such disruptions. We have reduced expedites, line stops, and unfinished vehicles by 50% since implementing the control tower, which equates to €260 million in inventory savings, as well as millions more in unanticipated costs. It also dramatically reduces stress levels for our staff, and takes away the anxiety around making a wrong decision.” 

Eventually, the control tower will connect Renault Group’s 34 factories, 6,000 suppliers and more than 100 carriers, tracking 6,000 shipments a day. Also in the offing is development of an industrial system that anticipates risks of production disruptions, utilizing Shippeo’s tracking platform and ETA calculation algorithm, and a machine-learning module developed by Renault that can recommend “realistic” alternative scenarios in the event of transportation delays. 

Resource Links:

Renault Group, https://www.renaultgroup.com/en/

Shippeo, https://www.shippeo.com/