The State of the Supply Chain
No one in their wildest dreams could have predicted how the global pandemic would affect parts availability in the automotive industry. Automotive News stated, “Two years of disruptions caused by the pandemic, the microchip shortage and a wide range of supply chain challenges are prompting automakers and suppliers to pursue a better sense of where their parts are.”
EASING THE STRESS
Lexus is committed to providing excellent parts availability and realizes that sourcing parts quickly continues to be a challenge for Dealers. With innovative and proactive steps Lexus continues to help ease any obstructions to enhance parts availability for Lexus dealers making parts available a priority.
“We are looking at the whole supply chain and coming up with solutions, says Todd Gick, Senior Manager, Parts Supply, Toyota North America. One area we identified is stagnation at the ports, which has been caused by workforce issues directly related to COVID. One way we are overcoming this is by air shipping parts to expedite customer orders and back orders. Another solution is that we are having parts shipped to additional ports, including Oakland and San Francisco in California, and to Mexico. This helps get the parts to the Parts Distribution Centers quicker.” To date, these solutions have been instrumental in aiding the overall situation. Gick adds, “The second area of concern is in regard to North American-sourced parts. We are sending in our staff to work with their teams to Kaizen the suppliers’ processes to help them be more efficient.” Every day, Lexus logistics experts are looking for ways to refine parts distribution processes to ensure Dealers receive the parts they need when they need them.
PUTTING IN LONG HOURS
Another way Lexus is committed to getting the supply chain back up to speed is by staffing up the Parts Distribution Centers (PDCs) across the country. This allows for quicker handling of freight and gets the parts in and then out to the Dealers. The staff at these PDCs are working over-time and weekends to get caught up.
The parts delivery process has also been refined so Lexus dealers who authorize unattended delivery can receive their parts orders 24/7. That way, if a dealer’s parts order is placed by 5 p.m., if those parts are in stock, they will be delivered to the dealer overnight so they are ready for the next day.1
Additional enhancements in parts procurement technologies, such as RepairLink® and CollisionLink® from OEC or OPSTrax® from Overall Parts Solutions (OPS), have helped make the ordering of parts easier for Independent Repair Facilities (IRFs). Then, to ensure timely delivery of those parts, Lexus dealers have partnered with technology providers to offer expedited delivery solutions.
One example of a new expedited delivery solution, OEC’s DeliverNowsm, is an on-demand delivery feature that integrates seamlessly into RepairLink. DeliverNow connects IRFs and Lexus dealerships with the largest established delivery fleet of crowd-sourced and insured vehicles in the U.S. DeliverNow makes sure your IRFs get the right Lexus Genuine Parts delivered on the same day2. This easy-to-use delivery option is built into your RepairLink parts ordering system.
LEXUS’ COMMITMENT TO IMPROVING THE SUPPLY CHAIN
The supply chain affects parts availability and is also affecting new vehicle sales. That means, in some cases, Lexus owners may be keeping their vehicles longer. That puts added pressure on your dealership having the right parts in stock when a guest brings their Lexus in for service, or when an IRF needs Lexus parts for one of their customers.
“Our goal,” Gick added, “is that by late August/early September, our parts flow from Japan will be much smoother, and during that same time period, our North American parts suppliers will improve as well. Together, this will help everyone get caught up and closer to business as usual.”
THE PARTS SHORTAGE HAS ALSO HAD A NEGATIVE IMPACT ON NEW VEHICLE SALES.
“It will take us well into 2023, perhaps even Q3 of 2023, before inventories begin to normalize. So, this tight car situation we’re seeing, both new and used, is probably going to be with us for another 12 to 15 months.”
—Bob Carter
Executive Vice President
Toyota North America
Disclaimer:
Delivery time may vary in more rural areas, depending upon distance from Parts Distribution Center.
DeliverNow same day delivery service applies to delivery from Lexus dealership to the independent repair facility and does not include time from PDC to Lexus dealership; DeliverNow is available to over 90% of dealer locations currently using an OEC solution, not a Lexus policy.
