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Toyota New Zealand has completed the construction of its recent warehouse expansion that now provides a total of 35,000 sq. metres for its parts warehouse facility in Palmerston North.
It was officially opened today with dignitaries, local neighbours and the local school in attendance.
“A lot of New Zealanders rely on us to keep their cars on the road,” said Spencer Morris, Toyota New Zealand General Manager of Finance, Planning and After Sales.
“We carry around $28 million of inventory, which is quite space hungry when you think about the huge variety of large items, such as bumpers, headlights and sheet metal, that we are required to stock.”
The next phase sees attention now shift to optimising more than four rugby fields of available floor space, with newly designed inbound/outbound areas to improve work flow and safety.
Following this a complete re-layout of the storage area will commence. This will further enhance safety and efficiency and is expected to take around 18 months to complete.
At the same time, seismic strengthening work will be conducted to bring the older parts of the building structure up to the latest building standards.
The latest extension saw the existing warehouse floor space of 24,000 square metres expanded by a further 11,000 square meters.
With a budget of nearly $20 million, this project is Toyota’s biggest single investment in New Zealand, far outweighing any previous capital expenditure.
This was the third warehouse expansion project Toyota New Zealand have undertaken in the last 15 years and reflects the sustained growth in parts demand on the back of record new and used vehicle sales during this time.
The expansion will allow Toyota New Zealand to continue to provide a 95% service rate to the Toyota Dealer network, which will generate around $200 million dollars of accessories and parts sales in 2018.
“This expansion allows us to supply more than 95 percent of daily orders off the shelf. These are shipped overnight to our network of 66 dealers around the country,” says Mr. Morris.
“Without the space we have here, we simply couldn’t meet this commitment to our customers.”
The warehouse now employs more than 40 people, an increase of more than 30% over the last 10 years and a further reflection of the growth of the business.
“The planning for the extension assumed a 10 year life based on five percent growth per year,” says Mr. Morris.
“Our growth has far exceeded our plans so we may be back to the drawing board sooner than we thought. It’s a good problem to have.”