Sales of electric vehicles are rising worldwide and on track to make up 58% of all passenger vehicle sales by 2040. Loved for their eco-friendly status and the fact that they don’t require expensive trips to the gas station, plug-in electric vehicles can reduce emissions and even save their owners money. Plus, EVs are often more digitally connected than conventional vehicles, with many EV charging stations providing the option to control charging from a smartphone app.
Different from the internal combustion (IC) vehicle supply chain, the logistics and transportation networks that support the electric vehicle (EV) supply chain require a new approach. The differing nature of the interconnection of components (i.e., kinetic for IC and electrical for EVs) means that the nature of different components’ interfaces is also very different. “This obviously has major supply chain implications,” MH&L points out.
EVs: Popular Worldwide
According to Forbes, sales of electric vehicles rose by 65% between 2017 and 2018, and then maintained their growth rate in 2019. Despite a setback in early-2020 due to the pandemic, it says improved batteries, more readily available charging infrastructure, new markets, and price parity with internal combustion engine (ICE) vehicles are all driving market growth.
Forbes points to General Motors’ anticipated $2 billion investment in six EV assembly plants in the U.S. as just one of many examples of how automakers are getting onboard with the trend.
In addition, it says President Joe Biden made net-zero emissions by 2050 part of his campaign platform, with an annual investment of $500 billion toward this goal, a portion of which will support EV production and charging infrastructure.
Right now, China accounts for the largest share of global EV sales and plans to expand further as it reduces energy imports, addresses its poor urban air quality, and attracts investors into its domestic auto industry. “Demand for electric vehicles in China reached 125,000 units in September ,” Forbes reports, “a startling mid-pandemic jump of 99.6% from the previous year.”
“With consumer consciousness on the rise and market forces gaining momentum,” BloombergNEF reports, “EVs are quickly becoming the future of the automotive industry and a darling for investors who recognize this growth potential.”
Supporting Automakers Around the Globe
DB Schenker’s footprint in the auto industry is wide and deep, and includes a broad range of OEMs and Tier 1/Tier 2 suppliers. Its worldwide network for procurement, distribution, and aftermarket logistics ensures that all EV components and vehicles reach their destination on time and in perfect shape. The company offers a range of storage services and transport modes, including road, rail, ocean, or air freight, and also provides eco-friendly transport solutions, consulting services, and 3PL/4PL concepts.
The logistics provider maintains facilities in all of the major sourcing and shipping locations around the world, and all complimented by a team of automotive industry experts. Working with some of the world’s largest OEMs, Tier 1, and Tier 2 suppliers, DB Schenker provides transportation and distribution, consolidation and deconsolidation, plus supply chain management solutions for markets worldwide.
Deep Expertise in the Auto Sector
Already working together in China and South Korea, Porsche and DB Schenker extended their alliance into Canada by opening a new, 176,000-square-foot parts distribution center (PDC) in Mississauga, Ontario in 2019. For the automaker, DB Schenker manages the parts storage and inventory management; picking and packing; and dispatch to the final destination (in Canada).
The new facility shipped about 282,000 orders during its first year in operation. The global logistics provider will work with the manufacturer of high-performance automobiles to run a streamlined logistics process that caters to Porsche’s highly-discerning customers.
According to George Fremis, Manager, Parts Operations & Logistics, Porsche Cars Canada, Ltd., the company sources its car parts directly from the company’s main warehouse in Germany. The new facility was Porsche’s first PDC in Canada, and roughly 140,000 square feet of it is run entirely by DB Schenker staff. The remaining space is used as a national training center, vehicle storage, and potentially a “Porsche Forum” to showcase the brand, its innovations—inclusive of electric vehicles—and host customers.
A Logistics Solution for EV Batteries
In July, DB Schenker introduced a new dedicated service that combines individual national and international regulations concerning battery types and transportation modes. It offers the service across all transportation modes, plus custom-made solutions for the complete battery lifecycle (e.g., inbound temperature-controlled transport of materials to production sites and the outbound transport of finished goods in approved and labeled dangerous-goods packaging).
“Batteries are the main drivers of the ongoing electrification of the world. With our global network, we can cover the whole logistics spectrum to create reliable solutions for safe and customized battery transport and storage,” DB Schenker’s CEO Jochen Thewes told The Stat Trade Times. “We believe that e-mobility will be a key driver towards a more sustainable future. With our new service dedicated to battery logistics, we are proud to be a facilitator of this game-changing development.”
Ocean freight transport of batteries can be combined with land transport infrastructures to meet the highest standards for comprehensive door-to-door supply chain solutions.
As air freight is the fastest option to move goods to their destinations, DB Schenker is continuously working on the acceptance of battery transports on important routes.
“Over many years we have gathered a deep expertise in the automotive, electronics, and semiconductor industries,” Rainer Kiefer, DB Schenker’s EVP of Global Sales added. “We are now combining our know-how and skills in a cross-industrial solution. Given our profound experience, we are also happy to offer consulting and training to companies with requirements for their battery supply chains.”