Mercedes-Benz cuts costs, reinvents its supply chain

2.64K 0

Mercedes-Benz is on the verge of reinventing its supply chain in its bid to reduce logistics costs by a staggering 20% per vehicle.

The best example is Mercedes’s 90 million-euro new consolidation center in Speyer, Germany, where components coming from the company’s European suppliers are repacked for more efficient shipping to plants in China, the U.S., and South Africa.

And this is only the beginning, as Daimler has announced it is taking into consideration the revamp of its entire supply chain, opening other similar consolidation centers in dynamic markets like Asia and North America.

Mercedes builds its cars, including the Smart branded models, along with engines and components, in 26 different factories all over the world. This network includes partnerships such as the ones established with Renault, Magna Steyr and Valmet.

One other area of interest is car production network. In the past 12 months, Mercedes has reshuffled its operations, eliminating the role of plant director in favor of one global manager in charge of certain model families, on architecture-related criterion – like the Mercedes-Benz compact cars manufactured in Germany, Hungary and China and underpinned by the MFA architecture.

Mercedes says not only these architecture-based clusters should boost flexibility and ensure stricter quality checks, but will help the company to manage new production ramp-ups – 11 of which, on six different sites, are expected to take shape this year alone.