Long-distance transportation of automotive parts by third-party logistics providers from the viewpoint of spatial organization of Just-in-Time systems

Abstract

Especially since the oil crises, Japan's long-distance, wide-area Just-in-Time logistics systems have been established through mutual cooperation between completed-car manufacturers, parts suppliers, their logistics subsidiaries, and third-party logistics providers (3PL), against a background of a shift to diverse, flexible production, development of communication and information systems, and more dispersed locations of completed-car factories. Before the oil crises, during the medium- and long-distance transport of auto parts, longer transport times and distances tended to result in parts delivery delays, making it difficult to arrange space for storage and sorting. This in turn resulted in inefficient circulation of vehicles and staff and led to higher costs. In response to such problems, 3PL built logistics centers with vendor-consolidation and cross-dock functions, which made consolidation, trunk transport, sorting, and division into periodic, small-quantity, high-frequency deliveries possible. These initiatives boosted the circulation rates of vehicles and staff, which reduced transport time, parts delivery delays, transport costs, and storage space needed; clarified the flow of parts and information', and reduced wasteful processes and superfluous staff to achieve greater transport efficiency. In sum, these completed flexible logistics systems simultaneously achieved economy of scale in consolidated trunk transport and economy of scope with detailed sorting and frequent small-lot deliveries. As examples, we compare the Kumamoto Plant of Honda Motors and the Mizushima Plant of Mitsubishi Motors. In Honda Motors' logistics, costs are mainly borne by each supplier, with reliance on the suppliers' own initiatives. However, Honda provides indirect guidance and support, for example, it transports parts as backhaul cargo after completed-product transport, using 3PL company A. Honda thus developed diverse logistics using railway containers and ferry boats. On the other hand, Mitsubishi Motors pays the all costs of parts logistics to 3PL, and its logistics are greatly influenced by the existing 3PL prime contractor (company E), which developed an information system linking miscellaneous suppliers and many completed-car manufacturers. 3PL company E collects and consolidates numerous parts from each supplier for transport to Mitsubishi Motors using this common information system. We also compare 3PL companies A and E. Company A transports parts as backhaul cargo after completedproduct transport This 3PL focuses on logistics techniques. On the other hand, company E is a provider of a shared information system that links parts suppliers with many car assemblers. Thus company E has the marked characteristics of a 4PL.