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Logistics Efficiency

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We have been working in the past 12 months to further reduce carbon dioxide (CO2) emissions throughout our vehicle transportation and logistics operations.

Improved vehicle supply from regional pools/reduced inter-island movements

For many years our unsold vehicle stock was stored in Auckland and Christchurch and transported around the country when wholesaled to retail Stores. This changed with the adoption of the Drive Happy Project business
model in 2018 ( see page 18 in our 2019 Sustainability Report), whereby new vehicles are held at three regional storage pools in Auckland, Wellington and Christchurch and only dispatched to Stores when sales have been
confirmed with customers. This eliminated the need for Stores to hold unsold stock and removed the need for them to sell stock to each other (which created additional freight movements).

Further improvements have been made in the supply of vehicles from regional pools and we have a robust approval process in place for any inter-island requests for new vehicle stock. This has reduced the delivery distance (and associated carbon emissions) by road and shortened the average delivery time to Stores, from five to seven days to three or four days.

On occasions we still need to move some cars longer distances by road – for example, when there is a supply shortage of a model and vehicles in the local pool have been exhausted, such as was experienced with the new generation RAV4 Hybrid.

We continue to explore better ways to forecast our regional stock requirements, and are progressing a project to process some Lexus vehicles in the South Island (currently all Lexus vehicles arrive into Auckland, irrespective of their final destinations). This could save an estimated 23 tonnes of CO a year*.

Rental-return management

We are monitoring the volume of South Island rental car returns moved north for refurbishment at TNZ’s Signature Class plant in Thames. The selection process for Signature Class vehicles has been refined to only allow inter-island movements of models that are in short supply in the North Island.

We are also looking at establishing a South Island refurbishment facility to further reduce the need to move our used-vehicle stock between islands.

Centralised accessorising/outwork

TNZ currently accessorises new vehicle stock at our Thames plant. We are looking at expanding this operation to centralise more of this work, instead of moving vehicles to multiple outworkers – for example, a vehicle could be moved to have a canopy fitted, moved again to have a light system installed, and moved again to have graphics added.

Each movement creates unnecessary carbon emissions and increases the risk of transit damage. Curtailing the number of movements will achieve a quicker, more efficient workstream, reduce costs and shorten customer
lead times.

Transit damage

A working group has been established with our road freight contractors to reduce the volume of vehicles that sustain transit damage. In extreme cases a vehicle will have to be returned to storage and switched for a new vehicle.