The supply chain investment boosts Volvo’s commitment to being the number one uptime provider for construction equipment in North America.
Volvo Construction Equipment has completed a 75,000-square-foot expansion of its Reno, Nevada, regional parts distribution center. The project, in conjunction with Volvo Group Service Market Logistics, increases floor space by 125% and brings parts closer to construction equipment customers with faster delivery times and reduced shipping costs. Volvo Group has operated the Reno Distribution Center since 2006, supporting the Volvo Trucks and Mack Trucks brands.
Globally, North America is one of the largest markets for Volvo CE. Over 20% of the region’s total business comes from the western third of the United States.
With the expansion, ground orders for California and the Pacific Northwest are now arriving two days faster compared to shipping from the Volvo Group’s central distribution center in Byhalia, Mississippi. A new Dedicated Delivery Service (DDS) now operates out of Reno as an exclusive carrier to expedite overnight shipments to western U.S. dealers, arriving at dealer branches by as early as 4 a.m. the next day.
The regional distribution center offers additional benefits including:
- Inventory of critical machine down parts on the shelf in Reno for overnight shipping;
- Parts order cut-off time extended to 4 p.m. PST; and
- Cost savings to customers, since more deliveries, can ship ground versus air
Delivering the service commitment
“By pooling the resources of the Volvo Group, these improvements to our North American logistics network increase efficiency and provide faster response times. Our commitment is to ensure we support machine uptime for our West Coast customers, and moving parts closer to where they do business is one of the major steps,”
said Stephen Roy, president of Region North America, Volvo CE.
Many western U.S. dealers are challenged to support customers spread across a vast territory. Planting a stand-alone parts center in their region has a significant impact, says Tom Zimmer, president of Tri-State Truck & Equipment.
“The Reno parts center has cut our lead times by 40-50% for construction equipment stock orders. As a Volvo Trucks and Mack Trucks dealer, we have seen the faster delivery times gained by having an aftermarket parts warehouse in our region. Now, we can offer the same level of uptime support to construction customers,”
said Zimmer, whose dealership services customers in Montana, Wyoming, and the Nebraska panhandle.
While the expansion directly impacts customers in the western U.S., customers, and dealers across the country are benefitting from rebalanced parts volumes throughout the supply chain. Volvo CE ended 2020 with record parts availability and dealer fill rates, despite constraints caused by the pandemic and increased demand on freight carrier services. These results demonstrate how Volvo CE continually lives and enhances its Service Commitment.
Volvo Group efficiencies
“Through substantial investments, we expanded our Reno facility and refined workflows to extend this strong level of service and support to another Volvo Group brand, Volvo Construction Equipment,”
said Bob Hochwarth, Vice President, Volvo Group Service Market Logistics for North America.
To support higher volumes and maintain agility, additional employees were hired and an onsite training center was created. New collaboration spaces and a central command center for team leads to improve communication flow.
“The employees at this site have proven their abilities through sustaining top-tier quality and productivity — attributes that make a meaningful impact for dealers and customers across the Volvo Group,”
The Reno Distribution Center has been consistently ranked as one of the highest-performing warehouses in the North American automotive sector by third-party benchmarking studies.
The expansion follows the opening of the Toronto Distribution Center in 2019. The Volvo Group parts distribution network spans eight locations in the U.S. and Canada