Volkswagen FAW Engine and Kuehne+Nagel China expand their logistics partnership

Volkswagen FAW Engine (Dalian) Co., Ltd (VWED), an automotive part manufacturer operating in a joint-venture with Volkswagen (China), has signed a two-year agreement with Kuehne + Nagel to manage the inbound logistics operations in the Dalian and Changchun plants from 149 automotive engine part suppliers nationwide.

The new contract leverages a sophisticated IT solution to address VWED’s requirements for improved efficiency of operations. The solution includes the use of dynamic planning to ensure cost optimisation while managing multi-leg journeys, line hauls and reverse movement. To provide more accurate real-time tracking of truck movements, Kuehne + Nagel leveraged China’s WeChat technology: Drivers use a mobile phone to scan a custom QR code to indicate a change in shipment status, automatically triggering an update in the order management system.

Utilising the WeChat platform avoids the need to install additional apps or set-up additional hardware, allowing sub-contracted truckers to also utilise the same system. This, combined with an overarching operational control tower approach, ensures full transparency of the entire operation.

Zhiyu Wang, Logistic Manager, VWED said: “Kuehne + Nagel took a complex set of demands and transformed it into a seemingly simple logistics solution. Kuehne + Nagel’s solution has delivered cost savings, efficiency and achieved full supply chain visibility for VWED.”

Pierre Li, Senior Vice-President Contract Logistics, Kuehne + Nagel North Asia said: “VWED is one of the largest international players in the automotive market in China and we are pleased to extend this partnership. This new contract showcases Kuehne + Nagel’s strength in the automotive parts industry in China bringing together the synergies of a tailored logistics solution supported by IT systems to provide full supply chain visibility.”

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