2013 will see an adapting supply chain
The struggling Global economy has inevitably seen the supply chain industry having to adapt during 2012 – a theme that will continue into 2013 according to end-to-end supply chain consultancy Crimson & Co.
Dave Alberts, Director at Crimson & Co claims that weaknesses in the western economies in 2012 has changed the way supply chains operate. “The economic climate has continued to drive an emphasis on cost reduction. Against this cost cutting background, businesses are still being asked to respond to the ever increasing pace of innovation. Innovation is vital for sales, and businesses are trying to find ways to manage the complexity this creates.”
Natural disasters of recent years still weigh heavily on the mind of supply chain professionals; with companies exploring sourcing options more actively and risk management gaining a larger role. The last year has also seen more companies looking at their logistics operations and how they can gain revenue, something which is especially true for high margin sectors such as pharmaceuticals and energy.
“As we look to next year, supply chain dynamics will change,” said Alberts. “Adapting from a relatively local supply chain to a global supply chain with appropriate localisation will become commonplace, presenting new challenges.”
As markets become more segmented and product lifestyles shorten, businesses need to ensure the benefits of managing at a regional or global level are balanced against the local requirements. Alberts comments: “Customer demands are getting more complex and ‘one size fits all’ will not provide competitive benefit. Those tailoring their supply chains will see a more successful 2013 than those that don’t.
“The next wave of supply chain thinking needs to take an holistic approach to cost reduction, service and cash flow improvements whilst accepting that complexity is here to stay whether we like it or not,” concluded Alberts.
About Crimson & Co:
Established in 2003, Crimson & Co is a fast-growing supply chain consultancy with a strong reputation for developing and implementing end-to-end supply chain solutions across the globe.
Elon Musk's Boring Co. planning wider tunnels for freight
Elon Musk’s drilling outfit The Boring Company could be shifting its focus towards subterranean freight and logistics solutions, according to reports.
A Boring Co. pitch deck seen and shared by Bloomberg depicts plans to construct wider tunnels designed to accommodate shipping containers.
Founded by Tesla CEO Musk in 2016, the company initially stated its mission was to offer safer, faster point-to-point transport for people, particularly in cities plagued by traffic congestion. It also planned longer tunnels to ferry passengers between popular destinations across the US.
The Boring Co. completed its first commercial project earlier this year in April. The 1.7m tunnel system is designed to move professionals between convention centres in Las Vegas using Tesla EVs. It says the Las Vegas Convention Centre Loop can cut travel time between venues from 45 minutes to just two.
Boring Co.'s new freight tunnels
The Boring Co.'s new tunnel designs would allow freight to be transported on purpose built platforms, labelled as “battery-powered freight carriers”. The document shows that, though the containers could technically fit within its current 12-foot tunnels, wider tunnels would be more efficient. Designs for a new tunnel, 21 feet in diameter, show that they can comfortably accommodate two containers side-by-side, with a one-foot gap between them.
The Boring Co.’s new drilling machine, dubbed Prufrock, can tunnel at a rate of one mile per week, which is six times faster than its previous machine, and is designed to ‘porpoise’ - mimicking the marine animal by ‘diving’ below ground and reemerging once the tunnel is complete.
Tesla’s supply chain woes
Tesla is facing its own supply chain and logistic issues. The EV manufacturer has raised the price of its vehicles, with CEO Musk confirming the incremental hike was a result of “major supply chain pressure”. Musk replied to a disgruntled Twitter user, confused as to why prices were rising while features were being removed from the cars, saying the “raw materials especially” were a big issue.
Car manufacturing continues to be one of the industries hit hardest by a global shortage in semiconductor chips. While China’s chip manufacturing levels hit an all-time high in May, and the US is proposing a 25% tax credit for chip manufacturers, demand still outstrips supply. Automakers including Volkswagen and Audi have again said they expect reduced vehicle output in the next quarter due to a lack of semiconductors, with more factory downtime likely.
Top Image credit: The Boring Company / @boringcompany