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Dec 09,2013

Honda Malaysia Switches To Railway To Transport Parts Between Thailand And Malaysia

Petaling Jaya, 9 December 2013 – Honda Malaysia today announced that the Company will switch to using rail-based transport system for delivery of parts between Thailand using Thailand National Railways (SRT) and Malaysia using Keretapi Tanah Melayu (KTM).  An official ceremony was held last month at KTM Sungei Way where 24 huge containers were delivered specifically for Honda Malaysia’s use. With this switch, Honda Malaysia will also become the first Honda company worldwide to switch to a rail-based delivery for optimal logistics.

Honda Malaysia’s production volume is anticipated to increase from the current 50,000 units annually to 100,000 units annually by 2016. Currently, 25 to 30 containers are being transported from Thailand to Malaysia on a daily basis. And this is expected to increase to 120 containers per day in line with Honda Malaysia’s future production plans.

In preparation for the increase in future production plans, Honda Malaysia is taking the initiative to reform its transportation support. The Company remains committed to continue providing excellent customer satisfaction by delivering parts in good condition, shortening the waiting period and backorders, reducing cost of production and passing the reduction in cost to Honda customers in the future.

This initiative is also in line with Honda’s global environmental target of 30% reduction in the CO2 emissions by Honda products by 2020. Thus, Honda is always on the lookout for ways to become a greener company, not only in the cars that they produce but also in the whole process of production. Honda Malaysia is pleased to announce that just by changing the mode of transportation from trucks to railway, it is able to reduce CO2 emissions by 60%. 

Upon research and trials by Honda Malaysia, it is found that using rail provides numerous benefits as opposed to the current mode of trucks and ships. Firstly, it is more cost effective. Using the railway as a mode of transportation is able to minimize logistic risks, avoid wastage and minimize damages. KTM uses the GPS tracking system and therefore, Honda Malaysia will be able to conduct real time tracking of its goods during the transportation. Honda Malaysia forecasts that with this restructuring, the Company would be able to reduce the cost of logistics by 50% within 2 years.

Delivery time will also be shortened. It takes 2.5 days for goods to be delivered from Thailand to Malaysia via railway. Currently, goods transported by trucks on roads takes 3 days to arrive while shipping takes 7 days. This will help increase efficiency and shorten the waiting period for Honda customers, besides being able to reduce stock in hand by 6 days.

Honda Malaysia is committed to continue improving its internal processes in order to keep to its mission of providing products of the highest quality at affordable prices for worldwide customer satisfaction. With this initiative, the Company hopes to continue providing the joy of ownership to its customers in Malaysia.

 

An official ceremony was held last month at KTM Sungei Way where 24 huge containers were delivered specifically for Honda Malaysia uses.

In preparation for the increase in future production plans, Honda Malaysia is taking the initiative to reform its transportation support.