Sustainability, digitization, standardization, and intercontinental shipments were recurring talking points at Automotive Logistics & Supply Chain Live.
Automotive packaging was in the spotlight at a recent online panel session, hosted by Automotive Logistics. Participants from Toyota, Ford, Rivian, and CHEP shared insights into their programs and the opportunities they see, going forward.
Sustainability: using ocean-bound plastics
While sustainability was top of mind for all panel members, Rivian, an electric vehicle manufacturer, is focusing on ocean-bound plastics where possible for its reusable packaging systems. The company’s goal is to utilize a half million kilograms of ocean-bound plastic in its reusables by 2024, according to Jake Goodman, manager, logistics packaging for Rivian. He equated the amount of recovered plastic to 7 million empty milk jugs.
Goodman described ocean bound plastic as single-use plastic, typically collected within 50 kilometers of the coastline in countries that lack mature waste collection processes. “And this is really where the ocean bound plastic story begins…Our partners are able to step in and help develop the collection processes and the recycling efforts,” he said. Local operators sort, clean and flake the recovered plastic, which is then shipped to the U.S. Material is currently being recovered from the Philippines Haiti, Indonesia, Brazil, and Egypt.
The process to produce reusables has been over a year in development for Rivian. The company started with structural foam to build bulk bins and pallet systems. ”And I’m excited to say that we’ve recently been able to adapt that same concept and methodology into our high-pressure systems,” he continued, a step that will allow Rivian to produce totes, lids and some other high-pressure injection molded pieces. “We’re going to try to push as many inbound parts into our plastic returnable systems as we can, trying to come up with new ideas and new designs that utilize plastics so we can further our impact using the ocean bound plastic material.”
Tracking: Toyota is RFID tagging all of its reusables
Exactly how many reusables does Toyota own? Tony Minyon, senior manager packaging and environmental, Toyota North America, estimated that his group has about 8 million reusables, but until they are tagged, he said, the company won’t know for sure. Toyota is collaborating with Surgere. “We’re very happy and partnering…closely with them,” he said.
Minyon provided an overview of reusables within the complex Toyota North America system. His group manages relationships with more than 1,000 suppliers, six cross docks, 16 parts distribution centers, and 11 plants in North America. There are also 30 global distributors and 41 export plants.
Axel van het Kaar, carline supervisor, material flow and packaging engineering, Ford Europe, emphasized the importance of standards for track and trace technologies. He noted that there are technologies available to track container movements and locations as well as to connect to the material inside the location. However, he stressed that standards are not yet defined on a large scale. Different trading partners have chosen various technologies such as RFID, Bluetooth, or three-dimensional barcodes.
“Once we have a standard there, then we can work together and roll it out,” he said. “But as long as each of us tries to develop their own solutions, then it might work on a lower scale and give you a traceability of 50 or 60%. But you’ll never reach full visibility.”
“One of the points I want to get across is when we talk about digitization, there are so many different technologies available to us,” added Sanjiv Takyar, head of innovation, solutioning and strategic marketing, CHEP Automotive and Industrial Solutions Europe. “And even though the technologies are very important in terms of how we obtain the data, there needs to be equal focus on how we actually convert that data into meaningful insight. And then that drives the right actions.”
He stressed that there is substantial hidden value within our supply chain that can be accessed with supply chain visibility. “So again,” he continued, “it’s about collaborating.” He suggested partnering with an expert provider such as CHEP to help establish wins.
Is the EV revolution an opportunity to establish container standards?
Common to many of the challenges facing automotive is the need to collaborate. CHEP’s Takyar sees the electric vehicle (EV) revolution as an opportunity to finally establish more standardization within the industry. ”We have a real opportunity now to drive the standardization in terms of packaging and container management, and obviously, that is something that is at the heart of our business,” he said, noting that standardization will help lower costs and improve sustainability.
“We’re very much now focusing on several areas relating to creating standards for important components like lithium-ion batteries,” Takyar noted.
“The challenge we face though is creating these standards as this requires a huge level of collaboration,” he added. “As I mentioned earlier, we have tried as an industry for many years but largely failed. However, with the onset of this industry revolution, maybe now I believe now is the right time to get this right.”
“If you develop a standard that works for a wider scale of OEMs, and tier suppliers, then you have an economy of scale,” observed Ford Europe’s van het Kaar. There have been “lots of discussions” involving the OEMs and some tier-one suppliers, which he described as important “because we all come from different angles, and we all want kind of the same goal.”
He pointed to the standard wheel pallet as an example of successful standardization used by all of the OEMs, describing it as a “common standard that we can just circulate. It makes it easy as well for the wheel manufacturer, because no matter what customer they have, they’ve got the same packaging equipment that they can use to ship material.”
Intercontinental shipments: advantages for pooling?
The cost and environmental toll of returning empty reusable packaging systems between continents has been a barrier to the implementation of reusables for manufacturers. Ford is now piloting a pooling service for reusable packaging movements between South Africa and Europe. “We get that container filled with material, empty it at the point of destination, and then it’s collected again by the pool provider and used to ship material back for another customer, said van het Kaar. “And that works excellently.”
“The concept of sharing will have a direct impact on eradicating empty transport miles,” Takyar said. “Utilizing robust reusable containers with longer lifespans will cut the use of one-way packaging, and therefore landfill waste.”
For its part, Toyota already uses steel reusables for intercontinental shipping and is working to eliminate the return of empty packaging by filling containers with parts for return to Japan.
While automotive’s appreciation for reusable packaging has long been evident, the industry faces a changing landscape, requiring new decisions regarding packaging and the interface with topics such as digitization, standardization, sustainability, and global supply chains. “Selecting the right packaging solution is an important part of making our supply chains more resilient and more sustainable,” Takyar stressed.