BMW outsources central functions to Kuehne + Nagel

Kuenhe + Nagel

The news that Kuehne + Nagel (K+N) has won a contract from BMW to run its spare-parts ‘Global Distribution Centre’ in Wallersdorf is the latest in a string of contracts that have placed K+N at the centre of the management of BMW’s aftermarket spare parts operation.

Already Kuehne and Nagel has an important role at the BMW spare parts warehouse for ‘slow movers’ at Bruckberg and at the ‘Dynamics Centre’ at Dingolfing. Taken together the three locations constitute the ‘Centralised Spare Parts Distribution Centre’(CDC). This is a complex of different logistics facilities that hold centralised inventory, consolidate and despatch consignments to either European markets or markets in the rest of the world. The ‘Dynamics Centre’ is an automated high-bay warehousing complex and appears to act as pivot of the network, managing the central inventory of the spare parts operation. Management of this inventory is fundamental to the management of the whole network and is believed to be largely still under the control of BMW, with K+N managing loading and transport activities between the Dynamics Centre and the other two locations. What K+N is responsible for is the loading, unloading, packing and packaging management around the CDC in general and the two sites at Bruckberg and Wallersdorf in particular.

The development of the CDC has had problems. In 2013 the vehicle manufacturer had severe issues with its warehousing management system software, resulting in the inability of BMW customers to get hold of components for a number of weeks. The involvement of K+N does not appear to be directly related to this. However, vehicle manufacturers have traditionally guarded their spare parts operations fiercely. Despite owning enormous warehousing facilities, they have been only willing to outsource activities on the periphery of the network, such as regional transhipment depots or smaller markets that are difficult to serve. BMW’s relationship with K+N represents a noticeable move away from this and may indicate a trend in the sector generally.

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Source: Transport Intelligence, October 14, 2016

Author: Thomas Cullen