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Automotive News World Conference

Distribution / Logistics Panel:“Finding the quickest route to your customer”

Christopher J. ConnorPresidentWallenius Wilhelmsen Logistics Americas

Tuesday, January 16, 2007 2www.2wglobal.com Automotive News World Conference

Content

Premise …

Market Environment; finished vehicle logistics market

Wallenius Wilhelmsen Logistics (WWL) Business Model

Reference Case; Nissan & WWL


Some Premise …

Finished vehicle logistics is critical, but should not be treated as a core competence by vehicle manufacturers.

Limited, if any, cooperation exists between vehicle manufacturers (to improve finished vehicle logistics) due to competition.

Collaborative solutions to improve vehicle shipment velocity, economics, and utilization of infrastructure are sorely needed.

Vehicle manufacturers can choose to outsource physical operations without compromising management oversight or control.


The outbound vehicle logistics market:Market conditions require strategic response

Strategic response needed

Speed of change Hyper-competition

Focus on core

competence

Market globalization

Global market competition is forcing OEM cost reductionsProduction emerging in low cost areas and emerging markets drive sales growth

High competitiondrives requirements for low-cost, efficient supply chain management solutions

Competence is vital for meeting supply chain demandsNetwork optimization and focus on KPIs

Supply chain needs are quickly becoming more complexSophisticated solutions are needed to keep up with changing environment

www.2wglobal.com Automotive News World Conference Tuesday, January 16, 2007 4


This is Wallenius Wilhelmsen Logistics:WWL Global Product Offering

Deep sea tradesTranshipment services Regional trades

Ocean Transportation

Terminal Services

Pre-shipment prepCargo prioritization Custom clearanceFreight forwardingOn CarriageStorage

Inland DistributionProcurement

Procurement of services from suppliers- Multimodal trans- Rail- Truck- Factory yard mgmt

ProcessingStorage maintenanceMechanical repairsSpecial Vehicles accessorizeIn plant handling

TechnicalServices

Management and optimization of the flow from factory to dealer, or parts thereof

Involves SCM management of minimum 3 elements in the chain

Supported by Systems and Processes

Supply ChainManagement

5


Products and Services:A seamless ocean and land-based network

Central and regional officesTerminals

Technical sites (VPCs)Technical sites (Plant VPCs)

Ocean routesInland distributionMain ports


Operating a global ocean and land-based network of highly effective entities.

Average 60 – 65 vessels in operation.

3.3 million movements of cars and rolling equipment globally.

– 1.7 million in ocean transportation

– 1.6 million in inland transportation

Operating 16 Technical Service centers globally – processing over 2.2 million auto units and 50k other rolling equipment units.

Procurement and distribution management responsibility for over 1.2 million autos to dealers.

Offices worldwide: 80

Employees: 3,500

This is Wallenius Wilhelmsen Logistics:Scale, Scope, and Competence


This is Wallenius Wilhelmsen Logistics:Ambitious environmental objectives

A key priority in all services from factory to dealer.Aims to be at the environmental forefront of our industry.Follows ISO 14001 international standards for environmental management.Corporate sponsor of WWF, the global conservation organization.E/S Orcelle: First zero-emissions concept car carrier.


This is Wallenius Wilhelmsen Logistics:Value Proposition – As an Integrator of services and Aggregator of volumes; WWL will increase velocity, contain economics, and improve utilization of Infrastructure for our customers.

Independently owned

Multiple customer / manufacture focus

High economies of scale

Full asset and facility utilization

Network optimization – optimized routes on basis of cost or service

Competence


WWL Global Product Offering:

“From Factory to Dealer”


Yesterday … Distribution & Auto Service under NissanYesterday … Distribution & Auto Service under Nissan

Single Customer Focus.Limited economies of scale.Single customer held commercial authority.Distribution & Auto Service held operational authority.

Today & beyond …Today & beyond …

Multiple Customer Focus.High economies of scale.Full asset and facility utilization – integration into Wallenius Wilhelmsen’s network.Wallenius Wilhelmsen holds both commercial and operational authority.Network Optimization / Optimal Routes (i2 Supply Chain Optimization).Aggregation of back-office functions.Access to local and global product expertise.

Reference Case:

Nissan & WWL


Aguascalientes

Civac

Manzanillo

Santos

Rio Grande

Lafayette

Canton

Smyrna

Galveston

ElizabethBaltimore

Newport News

JacksonvilleBrunswick

Tampa

Altamira

Houston

SavannahCharleston

Norfolk

New YorkNew JerseyTacoma

Halifax

CartagenaPuerto Cabello

Corporate Regional OfficeTerminals

Technical sites (VPCs)Technical sites (Plant VPCs)

Ocean routesInland distributionMain ports

Vancouver

Wilmington/Los Angeles

Oxnard/Port Hueneme

Reference Case – Nissan & WWL:

Integration into WWL’s network


Vehicle Processing

Manufacturing yard receipt and management

Main Activities

Inland Distribution Management / Procurement

Supplier purchasing and contracting - oversight, compliance, negotiations & rate agreements

Storage Maintenance

Pre-shipment preparation & Rail load/unloading

Customer Planning – Strategic and operational planning

Performance management – monthly performance reviews

Advanced Activities

Network Optimization / modelling & scenario planning

Customs expertise and documentation requirements for export/import

Initiate freight payments to suppliers and conduct freight payment auditing

Claims assistance / management


Services Performed


Track & Trace Supply Chain visibility

Customer and Supplier communication links

Systems capabilities

Vehicle inventory management

Network Modelling

Freight Bill Audit & Payment functionality

Supply Chain Event Management (in development)

Key Performance indicator – Dashboard report

Dwell Times

Reporting

Supplier performance

Quality – damage free

Inland Transportation time

Forecasting

Direct Customer links


Services Performed

DataWarehouse Measure anything in a vehicle’s lifecycle



Dashboard Report - example

Mth YTD

Quality/Value Prior Yr. Mthly - KPI YTD - KPI TargetComm-itment

1) Rail / Truck Damage Freq x% x% x% x% x% G G2) Internal damage CPU $.x $.x $.x $.x $.x Y G

On-time Performance

1) VSA Prebay - Exact on time x% x% x% x% x% G G2) 48 HR Shipping - days x.x x.x x.x x.x x.x G G3) Lead Time - days (inc holds) x.x x.x x.x x.x x.x Y G

Inventory Mgmt

1) Dwell Time (inc holds) x.x x.x x.x x.x x.x G G2) NMM Dwell - days (inc holds) x.x x.x x.x x.x x.x R Y3) POE Dwell - days (inc holds) x.x x.x x.x x.x x.x G G4) Class I repairs x.x x.x x.x x.x x.x G G5) Class II repairs x.x x.x x.x x.x x.x G G

Transportation

1) Abnormal $'s Spent $x.x $x.x $x.x $x.x $x.x Y G2) Total $'s spent $x.x $x.x $x.x $x.x $x.x G G

WWL/VSA Delivery to Dealer

Example Only


Wallenius Wilhelmsen Logistics:

Factory to Dealer“Finding the quickest route to your customer”

We provide our customers with greater precision and efficiency in their outbound supply chain and add competitive power and agility to their business.

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