The changing face of logistics in the Australian automotive sector

While Australia’s car manufacturing industry has closed after more than a century, other opportunities are opening in the sector for design and logistics.

In recent years, we have seen the closure of Toyota, General Motors Holden, Ford and Mitsubishi’s manufacturing plants. Since reports first surfaced of the planned closures back in 2013, many analysts have tried to quantify the subsequent fallout.

For the majority, there can be no glossing over the negative impact that the closures will have on the Australian economy. A report by the University of Adelaide estimates the industry collapse has put up to 200,000 jobs at risk across the nation and taken $29bn out of Australia’s GDP annually.

Global management consulting firm, Boston Consulting Group, now ranks Australia the worst performer among 25 nations assessed in its worldwide manufacturing cost-competitiveness index. Costs are higher than in Germany, the Netherlands and Switzerland and Australian manufacturing wages rose 48% in the past decade while productivity fell, it said.

The good news, however, is that Australia is reviving its automotive sector and making major contributions to the economy. For example, Toyota, Holden and Ford have all said they recognise the excellence of Australian vehicle designers and engineers. Ford has retained its production development centre and testing facility after it ceased manufacturing in 2016 and Holden has hinted that it will retain its global design studio.

In addition, the closure of automotive manufacturing has resulted in an investment in warehousing and distribution centres. For example, Renault, Nissan and Mitsubishi have launched a shared warehousing and logistics operation in Australia realising synergies to be replicated and expanded across the world.

The new Alliance National Parts Distribution Centre is one of Australia’s largest automotive logistics facilities and managed by CEVA Logistics. At over 37,000 square metres in area, it will use industry-leading technologies and processes for the fast and efficient movement of automotive parts and accessories. “This is a milestone development and a future test case for their global operations,” said Adam Duncan, CEVA’s General Manager Sales – Contract Logistics.

Stow Australia is proud to have designed and installed the major component of the warehouse; the racking, conveyor and mezzanine floor solution. The mezzanine floor has 3 tiers and provides approximately 70,000 storage locations for automotive parts and accessories. A further 29,940 pallet locations were installed as part of the racking component.

Another investment example in warehousing is the new ‘state of the art’ headquarters and parts warehouse for truck market leader, Isuzu Australia. Stow Australia was successful in winning the competitive tender to design, manufacture and install the multi-functional racking and storage facility for Isuzu, following the completion of a successful Brisbane-based warehouse racking project for Isuzu in 2013/14. The storage solution includes more than 5000 pallet spaces for high bay, oversize and cab racking and more than 20,000 bin locations over two tiers.

According to Isuzu Australia Limited’s Chief Operating Officer Phil Taylor, the new facilities will equip the market leader for years to come. “The state-of-the-art facilities will perfectly reflect our operations in the future – as Isuzu aims to continue improving on 29 consecutive years of market leadership.”

Despite concerns amongst the general public, the automotive industry is still very much alive in Australian logistics.

At Stow Australia, we provide industry-specific products and solutions. This includes high quality European designed and manufactured steel selective racking to bear heavy loads, multi-level mezzanine storage areas for small parts, variable sized racking for odd-shaped stock and deep lane storage for automotive parts that don’t always need to be accessible. Every Automotive custom-designed solution is created with the customer to ensure it is highly efficient and fit for purpose.

Are you searching for the most efficient automotive warehouse storage solution? Talk to the experts. For more information about our products and services, visit the Stow website or call on 1800 438 786.