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Intraregional supply chain solutions from producer to consumer
Commercial Vehicles Nampo 2014
Supply Chain Logistics
Becoming demand driven
Logistics
Walvis Bay Corridor Group
The truck that thinks for itself!
Frederick Hennop, Scania Botswana CEO – Holding the fort in Botswana P19 ISSN 1684-7946 July/August 2014 Vol.Mar/Apr 12 No. 2013 4 / R50.00 incl. VAT ISSN 1684-7946 Vol. 11 No. 2 / R40.00 incl. VAT
Get your costs in perspective. Over time, the speed of response and proficiency of your finance and insurance providers can have a big impact on your bottom line. So isn’t it better to use a specialist partner who from the moment you pick up the phone, understands that lost time equals lost revenue? There is a better way.
ENDORSED
Intraregional
Commercial
Veh
Nampo 201 icles 4
supply chain
solutions from
BY
producer to
consumer
Supply Cha
Becoming
in Logistic
demand driv s en
Log Walvis Bay istics Corridor Grou p
Intraregional supply chain solutions from producer to consumer
COVER STORY Actros: The truck that thinks for itself
INSIDE
P6
The truck that think s for itself !
THIS ISSUE
Frederick Hennop, Scania Bot the fort in swana CEO Botswana – Holdin P19 ISSN 1684-7
946 July/Au ISSNgust 1684-7 2014 946 Vol.Mar/Ap 12 No.r 2013 4 / R50.00 Vol. 11 incl. VAT No. 2 / R40.00
REGULARS
SUPPLY CHAIN LOGISTICS
2 FESARTA International help with solving non-tariff barriers 5 Cover Story Actros – the truck that thinks for itself 6 Regional News 8
Improve profit margins and free up
Editor’s Comment Resilience pays!
working capital Critical area of growth Becoming demand driven in a volatile world Walvis Bay Corridor Group
COMMERCIAL VEHICLES
Port of Walvis Bay
A critical event on the calendar FAW comes into its own First to receive new range Fully automatic transmission on UD 90 model Connecting transporters and loads in the SADC region Holding the fort in Botswana Vehicle load limits and dimensions
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11 13 15 17 18 19 21
Air cargo: driving force in moving freight
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incl. VAT
22 23 24 28 32 35
Fully synthetic lubricants can enhance your bottom line Rustenburg Rapid Transport update Air freight markets in modest slowdown
36 38 40
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TWA | Jul/Aug 2014
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EDITOR’S COMMENT
Resilience pays!
Publisher Elizabeth Shorten Editor Simon Foulds • simon@3smedia.co.za Head of design Frédérick Danton Senior designer Hayley Mendelow Designer Kirsty Galloway Contributors Raymond Abraham, Barney Curtis, Carol Ptak
S
Editor in action
UPPLY CHAIN MANAGEMENT has matured into a proud profession of experts with deep knowledge of all the functional elements of operations, combined with practical appreciation of the importance of end-to-end integration of processes, systems and people,” says Cobus Rossouw, SAPICS president. This has indeed become apparent at this year’s SAPICS conference. With the theme ‘Resilient Supply Chains’ it was interesting to hear about South African as well as international trends from the diverse range of keynote speakers. Without supply chain management where would we be today? This a statement I am sure your supply chain manager keeps reminding you of. Looking at all the links in the supply chain, we cannot have elements operating in isolation. So the importance of ensuring all your elements are in place when moving goods from the warehouse to the end user – via road, rail, air or sea – is critical. I learnt a lot from this conference and over the ensuing issues will be look at different aspects presented by both the international and South African speakers. In this issue, we talk to those who attended Nampo, look at fleet management, find out about becoming deman driven in a volatile world in the supply chain as well look at both the Walvis Port and the Walvis Bay Corridor Group. As always, a varied read – enjoy!
Simon Foulds
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TWA | Jul/Aug 2014
Chief sub-editor Tristan Snijders Sub-editor Beatrix Knopjes Client services & production manager Antois-Leigh Botma Production coordinator Jacqueline Modise Marketing manager Hestelle Robinson Digital manager Esther Louw Distribution manager Nomsa Masina Distribution coordinator Asha Pursotham Financial manager Andrew Lobban Administrator Tonya Hebenton Printers United Litho JHB • t +27 (0)11 402 0571 Advertising sales Hanlie Fintelman • h.fintelman@lantic.net t +27 (0)12 543 2564
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www.3smedia.co.za Annual subscription: R300 (incl VAT) subs@3smedia.co.za ISSN 1684-7946 © Copyright. All rights reserved. All articles herein Transport World Africa are copyrightprotected and may not be reproduced either in whole or in part without the prior written permission of the publisher. The views of contributors do not necessarily reflect those of the publishers.
Product information: Axle, transmission and gear oils
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FESARTA COMMENT
by Barney Curtis, chief executive officer, FESARTA
International help with solving non-tariff barriers
F
ESARTA was invited by the South African Institute of International Affairs to meet with the German donor agency, GIZ, in Cape Town, and try to find a way forward with solving non-tariff barriers. SAIIA is committed to solving these NTBs and GIZ is keen to support the process. This is good news for FESARTA, since FESARTA does not have the capacity to do what is required. Now it can raise the NTBs and provide input for their solutions. Member states agreed to solve the NTBs that apply to them, but they have done little to make a difference. The meeting identified that the SADC Protocols (trade, trade services and transport) were in place, but were not being complied with. There was a SADC tribunal, which was the highest level for dealing with international problems between member states, but this had been disbanded. Thus, SADC and the other RECs, do not have the ‘teeth’ to force member states to comply with regional recommendations. (EAC has regional acts, and these give that REC more control over its member states). A few of the critical NTBs were identified at the meeting: • NTB530 – Zambia requiring foreign tankers to comply with its regulations and for the tankers to be inspected at the transporters’ cost. • NTB605 – Security problems at the Kasumbalesa border post between Zambia and DRC. • NTB606 – Security problems at the Munhava township just outside the Beira port. SAIIA and GIZ are to discuss the outcomes of the meeting and then approach FESARTA with their recommended plan
of action. We do hope that this initiative will help solve the more serious NTBs.
Vehicle registration problems Some South African transporters are having problems with their vehicle registration documents at Dondo, near Beira, in Mozambique. The problem stems from the information on the South African registration document (RC1). The licence or registration number, as on the number plate, is only entered on the registration document if the vehicle has previously had other registration numbers. New vehicles do not have previous numbers and so no registration number is entered. The Dondo authorities do not accept this. The registration number must be on this document even though it does appear on the licence receipt document (MVL1). The vehicle registration number appears on both documents and this ties the two documents to the vehicle. FESARTA is recommending that South African transporters with new vehicles give originals of both the registration document and the licence receipt to the drivers, when they operate into Mozambique. This should prevent future problems. Only minor NTBs have been solved since the last comment. The major ones are still causing problems. Let’s hope that the new initiative with SAIIA and GIZ makes a difference!
Some South African transporters are having problems with their vehicle registration documents at Dondo, near Beira, in Mozambique
Barney Curtis. TWA | Jul/Aug 2014
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COVER STORY
MERCEDES-BENZ ACTROS
The truck T that thinks for itself Vehicles that think for themselves... for many this might sound like a futuristic, space-age fantasy – but, for those in the know, this concept is already a reality in products on the market from top commercial vehicle manufacturers such as MercedesBenz Trucks.
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TWA | Jul/Aug 2014
HANKS TO THE PROGRESSIVE business philosophy of Mercedes-Benz South Africa, it is now possible for your truck to tell you when it needs a service. Effective from 1 May 2014, all Mercedes-Benz Actros models sold with a CharterWay contract will include an enhanced maintenance package utilising the Telligent maintenance system. The first truck manufacturer to introduce this product in South Africa, Mercedes-Benz Trucks (a Daimler Truck and Buses brand) is changing the maintenance and servicing mentality in the country. Moving away from pre-set service intervals, this product makes individualised service intervals possible by taking its cue from the actual wear and tear on the vehicle. The truck is designed to monitor the condition of the engine oil, transmission oil, axle oil and general service components such as air filters, fuel filters and brake pads, based on the operating conditions of the vehicle. This ensures optimum utilisation of operating fluids and service parts without risk to the service life or reliability of the engine and driveline. The Telligent maintenance system stores information about faults, but only alerts drivers if they need to take action. Telligent maintenance lowers total cost of ownership
COVER STORY
The 2013 State of Logistics Survey for South Africa, published by the CSIR, attributes increased logistics costs in the economy to be a factor of “a disproportionate growth in cost-drivers – especially fuel.” Logistics costs of R393 billion in 2012 escalated to R423 billion in 2013 and the CSIR forecasts this to stand at R456 billion in 2014. Product manager at Mercedes-Benz Trucks, Christo Kleynhans, confirms that the company’s consistent focus on lower total cost of ownership for its customers has led to innovations such as Telligent maintenance. “Fuel and maintenance are the two most prominent cost-drivers for a customer. We already have many innovations in our trucks that address the first concern, and now the Telligent maintenance system also adds to the value-added products that address maintenance costs,” Kleynhans says. No two MercedesBenz Actros customers have exactly the same wear and tear on their trucks, due to the wide variety of applications in which these versatile trucks can be used. Telligent maintenance tells the driver or truck owner exactly what needs to be serviced, and when. This leads to less time spent in the workshop and more time where the truck and driver are productive. Effective usage of the system can realise a saving of up to 14% in service costs. Optimal results will be realised if used in conjunction with FleetBoard, the benchmark vehicle management and tracking system provided by Mercedes-Benz South Africa. Over a 18-month period from 2011 to 2013, Fleet-board registered a combined savings of over R6 million and uptime savings of 2 658 hours, in 658 cases. FleetBoard provides impartial, comparable data from all vehicles of a customer’s fleet. The system provides an
overview of the mileage, operational status, consumption, and deployment profiles of the drivers at one glance, including an evaluation of the overall driving styles. This will enable the fleet manager to determine the causes for high consumption and promptly address them to ensure correct deployment of trucks, thus increasing the economic efficiency of the fleet. From an environmental point of view, the Telligent maintenance system also scores brownie points for the manufacturer and the truck owner. Less frequent oil and filter changes equate to less of these items contributing to pollution. For an Actros to qualify for this unique value offering, it simply needs to be activated on either Christo Kleynhans, product manager, the CharterWay BestBasic or Mercedes-Benz Trucks, CharterWay Service Complete contracts available at the nearest dealership. However, cancellation of the CharterWay contract will result in the vehicle returning to fixed service intervals. Although this offer applies to vehicles sold with effect from 1 May 2014, trucks sold prior to May 2014 on a CharterWay Contract are eligible to be converted to a Telligent Maintenance Contract backdated to 1 January 2014. “Daimler Truck and Buses prioritises research and development, a primary reason why Mercedes-Benz Trucks is able to bring new and innovative cost-of-ownership solutions to our customers and remain a leader in the industry,” Kleynhans concludes. www.mercedes-benz.co.za/telligent
“Mercedes-Benz is able to bring new and innovative cost-ofownership solutions to our customers”
TWA offers advertisers an ideal platform to ensure maximum exposure of their brand. Companies are afforded the opportunity of publishing a two-page cover story and a cover picture to promote their products to an appropriate audience. Please call Hanlie Fintelman on +27(0)12 463 2564 or e-mail her at h.fintelman@lantic.net to secure your booking.
TWA | Jul/Aug 2014
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REGIONAL NEWS
KENYA
Read more on www.transportworldafrica.co.za
ity-assured pharmaceutical warehousing and distribution. “Healthcare practitioners in underserved areas are faced with a growing burden of complex disThe groundbreaking event for the ease mannew facility was attended by South African and Kenyan business leaders agement, and dignitaries aggravated by ageing Imperial Health infrastructure and unreliable supply Sciences anof essential medicines, and without nounced the sustainable warehousing infrastrucdevelopment of a new, state-of-the-art ture and supply chain systems in pharmaceutical storage and distribuplace, practitioners in the field cannot tion facility in Nairobi, Kenya. access a safe, secure, reliable supply Dr Iain Barton, Imperial Health Sciof medicines in line with best-practice ences managing director, says, “This quality standards.” custom-built warehouse forms part Located on Mombasa Road in of our active delivery of healthcare Nairobi, Imperial Health Sciences’ and storage solutions in developing new facility is 9 564 m2 in size and markets, where there is a dire shortwill offer 5 361 pharmaceutical pallet age of warehouse facilities that meet locations, as well as 3 978 consumer the requirements for effective, qualand 466 cold-chain pallet locations.
State-of-the-art pharmaceutical warehouse
REGIONAL
Committing to building a better Africa At the end of the African Development Bank’s 49th annual meeting, bank leaders pledged to rally efforts towards building an Africa that is more inclusive, integrated, and with better infrastructure. Among other priorities for the bank in the next 10 years, and in line with wishes from the discussions, they are enabling a more environmentally sustainable economy, sound leadership, managing natural resources, along with including more women and youth in the economic process in countries across Africa. At the heart of the continent’s development vision, through the AfDB’s financial support in the next 50 years, is an initiative called Africa50 – a move to raise $100 billion that is needed to fund Africa’s infrastructure. Africa50 will mainly focus on high-impact national and regional projects in the energy, transport, ICT and water sectors. Source AllAfrica.com
EAST AFRICA
Trade barriers set to end
Border delays will be minimised in the SCT The Tanzania Revenue Authority has confirmed that from 1 July 2014, the Single Customs Territory (SCT) will be implemented in full for the region. The SCT is aimed at eradicating trade barriers in East Africa. The SCT initiatives fall under the trilateral arrangement involving Tanzania, Burundi and Uganda for the central corridor and Kenya, Rwanda and Uganda for the northern corridor. Once implemented, it is expected to eradicate trade barriers by adopting a central model of clearance of goods, whereby taxes and assessments will be done only at the first point of entry. Therefore ensuring faster clearing of goods as well as reduction in the cost of doing business. Source AllAfrica
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TWA | Jul/Aug 2014
The development also includes a 1 000 m2 office area and a conference and training centre. Barton adds, “Job creation and environmental considerations are priorities on the project and the $20 million construction contract has been awarded to a consortium of Kenyan contractors. At its peak, the contract will create employment for 400 local people. Sustainability initiatives at the new facility will include • solar-powered external lighting and electric fencing • LED lighting in all offices • energy-efficient, sensor-operated industrial fittings in the warehouse • energy-efficient air-conditioning units throughout the facility • solar-heated hot water. Thermo-protecting paint and energyreducing insulation are being used to minimise the facility’s heating and cooling requirements. The development will harvest rainwater, and will have its own water purification plant.” In terms of job creation, once the facility is up and running in 2015, Barton explains that Imperial Health Sciences currently employs 96 people in Nairobi, and the warehouse will take this number up to 180.
REGIONAL NEWS
EAST AFRICA
An information exchange system that will allow East Africans to report non-tariff barriers (NTB) via text message on their mobile phone has been developed in Uganda. Sam Watasa, lead adviser on Uganda’s national response strategy for the elimination of NTBs, says , “The system, set up at a cost of $100 000, will provide a clear record of NTBs, and help the country assess progress in eliminating them. “When you use the hard copy form and take it to the appropriate desk, it takes anywhere between one and three months before the matter is dealt with. Under the new system, the message will reach the department that introduced the NTB immediately.” With this new system, a person experiencing a barrier sends an SMS to code 201, at a cost of Ush150 ($0.06).
SMS service to report trade barriers
milestone in pursuit of the aspirations expressed in the National Development Plan, New Growth Path and Industrial Policy Action Plan.” Preceding the SEZ Act, the DTI initiated the Industrial Development Zone (IDZ) programme under the ManufacRevitalising the economy, turing Development Act, in 2000. The improving the investment focus of the IDZ proclimate, strengthening gramme was largely the manufacturing sector to attract foreign and job creation. These, direct investment, according to minister of increase exportatrade and industry Dr tion of value-added Rob Davies, will result manufactured following president Jacob products and create Zuma signing the Special linkages between President Economic Zones (SEZ) domestic and zoneJacob Zuma Act, 2014. based industries. Davies says, “The SEZ Act aims to According to Minister Davies, the support industrial development for criteria for IDZ designation were our country, improve manufacturing biased towards the development capabilities, and the development of coastal regions and ignored of more competitive and productive economic potentials existing in the regional economies – with strong upinland regions: IDZs by nature are and downstream linkages in strategic export oriented and their vicinity to value chains. Its signing into law the sea or airport becomes strategic by President Zuma is a significant for logistics purposes.
SOUTH AFRICA
Special Economic Zones Act signed by the president
SOUTH AFRICA
Absa-Cape Chamber of Commerce Western Cape Exporter of the Year Award launched The Cape Chamber of Business has launched its 2014 Exporter of the Year Award. Applications need to be submitted by 12 September 2014 and the results will be announced at the Gala Dinner to be held in November 2014. For further information contact exporter2014@capechamber.co.za or contact Mary Jean Thomas-Johnson t +27 (0)21 402 4300
SOUTH AFRICA
Waste wood and timber from motor manufacturers creates jobs Turning waste wood into viable commodities has created 160 jobs for EC Wood, a Uitenhage-based company. General Motors South Africa EC Wood owner Japie Wessels (left) (GMSA) has comand employee Mbulelo David craft mitted to reducfurniture from waste wood ing the amount of waste it creates, and to making sure that it sends the least possible amount of waste to landfill sites. In this process of making sure that waste is reused as much as possible, the company has contributed to creating jobs and business opportunities for small entrepreneurs. Angus Clark, head of plant engineering at GMSA, says, “More than 1 546 tonnes of waste wood and timber was removed from the Struandale plant in 2013. Of that, just over half was turned into useful wooden products.”
MOZAMBIQUE
Italy is aiming to increase its trade with Mozambique following a growth in exports and imports with the African country during 2013. Italian exports to Mozambique in 2013 totalled 60 million euros, or 28% more than in the previous year, and its imports from Mozambique rose by 28% to 354 million euros. To increase trade between the two countries, Italy’s Foreign Trade Agency brought a business mission to Maputo earlier this year. Meetings took place in a number of sectors, including the agro-industrial, construction, banking, oil and gas, renewable energy, fishing, health and environmental sectors. This mission is the first of an ‘Africa Plan’ initiative set up by the Italian ministries for Economic Development and for Foreign affairs. On a visit last year to the Maputo International Fair, the deputy minister for Economic Development, Carlo Calenda said Mozambique was a priority for the Italian government and private sector.
Italian businesses seek opportunities
Source macauhub
TWA | Jul/Aug 2014
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COMMERCIAL VEHICLES
A critical event on the calendar
Nampo Harvest Festival in Bothaville is the biggest and most prominent agricultural show in the Southern Hemisphere – the perfect venue to showcase products aimed at the agricultural community. Simon Foulds speaks to some of the companies who exhibited there this year.
G
ENERAL MOTORS South Africa, Nissan, Ford, Scania, VW Commercial, UD Trucks Southern Africa, Volvo Trucks SA (Volvo and Renault Trucks) are some of the companies who see this event as one of the key events of the year.
Scania Alexander Taftman, product and marketing director, Scania South Africa, said, “Scania has exhibited at Nampo for the last eight years. It is a great event that gathers many different industries at one spot, which is of great convenience to customers and prospects. “Normally, Scania displays its full range of products and services. This year though, we took a different approach and streamlined the product and service line-up to the local market demand. We decided not to bring buses to give more room for the trucks, especially rigids, which we had two different versions of this year, both adapted to the farming and game industries. “It was the first official launch of the Scania Fleet Management system in SA and it was also the launch of
the 6x4 distribution designed for the farming community as well as the 8x8 rigid for tough off-road conditions, like game farms.”
UD Trucks Southern Africa Jacques Carelse, managing director of UD Trucks Southern Africa, adds, “UD Trucks was once again out in full force at this year’s Nampo Harvest Festival in Bothaville. With a focus on transport applications for the agricultural industry, UD Trucks also introduced new truck models at the show.” “The first of which were the two new Quon GW 26 450 6x4 truck-tractor models, which are available in a standard and high-roof version. “We also introduced our new UD90 ATM heavy commercial freight carrier, which is now available with an Allison automatic transmission. “We are very pleased with the outcome of this year’s Nampo Harvest Show, as we definitely had an increase in visitors on the stand, a lot of interest in our products and several solid leads. We have also had extremely positive feedback on our new corporate branding displays and the layout and theme of
Major players’ stands at Nampo 2014. (Clockwise from top left) Isuzu, Renault,UD Trucks and Volkswagen
TWA | Jul/Aug 2014
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COMMERCIAL VEHICLES light commercial vehicles, which offers the commercial and private farmer a solution for all his fleet needs. Passenger vehicles and SUVs provide a further solution in the private capacity.”
Ford
our stand, which once again offered us the opportunity to welcome and host customers in true UD style.”
Volvo Trucks SA
(Clockwise from top left) Volvo, Nissan and Scania
Valentia Hobbs, GM marketing communication, says, “The Volvo and Renault Trucks were proudly represented at this year’s event. “Over the years, the show has served as a proverbial showcase of the latest ranges and transport solutions available to the agricultural industry, and many big investment decisions are made by fleet owners according to what they see at Nampo. “Volvo Trucks moved its entire roadshow kit, attracting a lot of attention with the new FH, FM and FMX models proudly on display. “On the Renault stand, we had the new range for VT (FM, FMX, FH) and RT (Kerax and Lander) on show. “The Renault team is already planning its stand for next year’s Nampo, when the new range will also be available.”
“We focused strongly on our lifestyle vehicles, particularly the Amarok”Jaco Steenekamp, GM of
GM SA
Alastair Ironside, general manager of marketing for General Motors South Africa, says, “The company has been exhibiting at NAMPO sales and marketing, VW Commercial for over a decade. It is a targeted business audience, especially for products such as our Isuzu bakkie range. “The Isuzu product is the backbone of our agricultural sector sales thrust and so it was important that we showcased all of our different body styles and powertrains. “We also chose our Chevrolet products to display based on known agricultural sector interest and sales records, mainly the commercial Utility and Trailblazer.”
“Ford has exhibited at NAMPO since 2007”Dale Reid, brand manager, Ford South Africa
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TWA | Jul/Aug 2014
Nissan Veralda Schmidt, manager of media relations and corporate affairs, states, “Nissan has been a regular exhibitor at Nampo for more than 20 years. “This year, our display focused on the Nissan light commercial vehicles, with the showstopper being the new Nissan Patrol Pickup. “Nissan offers the most comprehensive range of
Dale Reid, brand manager at Ford South Africa, adds, “Ford has exhibited at NAMPO since 2007. “Our line-up of commercial vehicles was on display at Nampo this year, which included Transit and Tourneo Custom, and our new two-tonne Transit and 18-seater Tourneo. We also had our new Transit Chassis Cab on display. Our Ranger XL was there, along with our Odyssey Ranger, which will take on Africa again this year (details TBC). Other vehicles included the Ranger Wildrack, Single Cab, Super Cab XLS and Single Cab XLS. Passenger vehicles were also on display, but our main focus area was our commercial vehicle line-up because of the appeal of this range to Nampo’s target market. However, our SUV line-up (Kuga and EcoSport) – vehicles that are as comfortable on tar as they are on gravel – also drew quite a bit of attention. “Nampo is aimed at a very influential target market with significant buying power, and it is one of the shows at which we record the most sales. Because it’s not a standard motor show, it is always an interesting and exciting environment for us to position ourselves in.”
VW Commercial Jaco Steenekamp, general manager of sales and marketing, Volkswagen Commercial Vehicles, elaborates, “Volkswagen Commercial Vehicles has been exhibiting at Nampo since 2006. And our stand in 2014 focused strongly on our lifestyle vehicles, particularly the Amarok. This included the prototype, Amarok Extreme – a highly styled and accessorised off-road Amarok, the official Voetspore Amarok as well as the Safari Roetes Amarok. The Caravelle, Transporter Crew bus and Caddy Maxi Trendline were also on display as well as the popular, new addition to the Caddy range – the Cross Caddy (available in South Africa from August 2014). “The size of the show is incredible. When you think of an agricultural show, one doesn’t realise the diverse and broad range of products that can be offered to this market. Nampo is also different from other shows in a sense that the audience is much more captive. Most visitors to the show are there for a specific reason; they know what they are looking for and what they want. The consumer is also a lot more knowledgeable about your products on a technical level.”
2015 All the companies said they will definitely be at Nampo in 2015 because they all view the agricultural community as an important market, and Nampo as a critical event on their annual calendar.
COMMERCIAL VEHICLES
FAW comes into its own
S
The FAW South Africa brand and its acclaimed products have entered their 20th year in South Africa, becoming firmly entrenched in the local transport industry landscape.
INCE FAW first established a local pres-
and agricultural sectors – anything from long-haul, to cou-
ence in South Africa in July 1994, it has grown from humble beginnings into a multimillion-rand undertaking. Today, FAW SA has a sales and service dealer footprint of 23 dealers, including the three major regional centres, and a R70 million parts stockholding warehouse in Spartan. Added to this is a world-class Johannesburg headquarter campus together with its premium showroom; and a dedicated R600 million local production plant in Coega – coming online in July this year. Rightfully celebrating its ‘coming of age’, FAW South Africa has proven its prowess as a serious contender in the market with an array of highly robust, reliable and affordable commercial vehicles in the medium, heavy and extra-heavy segments. These include specialised tippers, mixers and truck-tractors combined with trailer or body configurations. The founder of the local company, astute businessman Richard Leiter, originally recognised the inherent value in the FAW brand of trucks that embodied a unique level of durability, strength, simplicity and longevity and chose to establish a licensing business for import and local sub-assembly of FAW trucks. With considerable wisdom and foresight, Leiter later invited greater investment into South Africa by extending a shareholding opportunity in his South African company to the FAW China Group and other investors. Today, Richard Leiter still remains close to the business as a director and a minor shareholder in FAW South Africa. FAW, worldwide, holds to the core vision of ‘total customer satisfaction’ and the company leaves no stone unturned to ensure that it has the best cutting-edge technologies,
rier companies, farmers, construction companies, mines, timber transporters, rental companies and many others. The company has provided solid evidence of its commitment to both South Africa, through numerous and continued investments, and local individual- and fleet-operator customers by its unwavering and unflinching dedication to providing aftersales support of note. The FAW Service Centre includes a fully equipped repair centre with innovative equipment and highly trained technicians, able to competently service and repair all FAW trucks. Honouring its commitment to South Africa, a stateof-the-art FAW truck plant is nearing completion at the Coega Industrial Development Zone in the Eastern Cape. FAW’s decision to build the plant in South Africa is significant as it is, to date, one of the most important investments made by a Chinese entity in South Africa. The total investment of approximately R600 million has been financed by majority shareholder FAW Africa Investment. The arrival of FAW in the Eastern Cape region adds yet another blue-chip automobile company to the province. Expected to eventually produce 5 000 trucks annually, it is envisaged that the plant will be completed early next quarter, and the first trucks to be assembled in the new plant will roll off the assembly line in the third quarter of 2014. A second phase of expansion under consideration could see the Coega plant extended to produce up to 30 000 passenger vehicles a year. FAW South Africa is committed to offering vehicles
production methods and management systems to fulfil this vision. Since inception, FAW has produced 16 million vehicles and has consistently been a Fortune 500 company. FAW South Africa, today, has customers across the length and breadth of South and sub-Saharan Africa – from Cape Town to the far northern regions of the DRC. Its customers span almost all of the major business, industrial
engineered, developed and rigorously tested to meet the harsh operating conditions in Africa. Along with this commitment, it is the desired intention to continue expansion into the emerging markets of Mozambique, Zimbabwe, Botswana, Zambia, Namibia and Angola. This makes FAW South Africa a major distribution hub for trucks and parts for Africa.
FAW range
FAW is the third largest vehicle manufacturer in the world
TWA | Jul/Aug 2014
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COMMERCIAL COMMERCIAL VEHICLES VEHICLES
First to receive new range Volvo Trucks Southern Africa handed the first regional units of its new FH model to two customers in Gauteng and KwaZulu-Natal.
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N GAUTENG, TRITON Express Group CEO Eric Corbishley was officially handed the keys of the two new trucks by Volvo Group Southern Africa’s president, Torbjörn Christensson, whilst the Westmead Group, based in KwaZulu-Natal, took delivery of two new units, making them the first customer in the eastern region to welcome the new Volvo FH to its fleet. Says Christensson, “This is a very significant day for the Volvo Trucks team as it is the culmination of years of planning and hard work. And we are very proud to be delivering these first units to some of our most valued customers with whom we have had a very good relationship over a number of years. They both share many of our core values, such as environmental care and safety, and we therefore believe these new units will certainly add a lot of value to their business.”
Triton Express The first of the units Triton Express received is a FH 500 HP 6x4 truck-tractor, which is Euro 5 compliant, and has a high chassis height and rear air suspension. Three years ago, the company was also first in the country to acquire a Euro 5 FH Classic, and 8% of their current fleet is also Euro 5 compliant. The second model is a FH 480 HP 6x4 truck-tractor, also with a high chassis height and rear suspension, with a Euro 3 engine. These units are also equipped with some of the latest safety, security and comfort technology available, from driver alert and lane-change support, to Dynafleet support and telematics.
FH Series The new FH Series, from the ground up, was purposefully designed with the driver in mind, providing him with a comfortable, profitable and safe ride. With its new Volvo FH series, Volvo Trucks Southern Africa says it is pushing the envelope of what a premium truck can offer. This includes maximum uptime, leading fuel economy, reliability, ergonomics, superior handling, active and passive safety, as well as a range of time-saving features. The Volvo FH has been Volvo Trucks’ flagship model for almost 20 years. Since the launch of a new version of the Volvo FH in Europe in 2012, more than 2 500 units have already been sold in that region. Concludes Christensson, “Locally, we are expecting to complete delivery of the first 20 units of the new range at the beginning of June, and the run-out of the Classic ranges by the end of that month. With a healthy local order book of already more than 1 000 units, we are looking forward to increased market share and continued success with the new model ranges.”
ABOVE Westmead handover BELOW Triton Express
Westmead Group The family-owned Westmead Group also took delivery of a FH 480 HP 6x4 truck-tractor with high chassis height, with B-ride. The Westmead Group has taken ownership of all three generations of Volvo FH models since Volvo’s inception in South Africa.
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COMMERCIAL VEHICLES
Fully automatic transmission on UD 90 model With the introduction of the new UD 90 ATM model to its line-up, Jacques Carelse, MD of UD Trucks Southern Africa, tells Simon Foulds why the company is so excited about this model.
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HIS HEAVY COMMERCIAL freight carrier now boasts a fully automatic Allison transmission and is set to provide fleet owners with more powerful, efficient and productive performance,” says Carelse. As the country’s leading HCV manufacturer for the past number of years, UD Trucks grew sales of their UD 90 by 66.07% month-on-month during April 2014. Carelse believes this new model offers fleet owners a smart and modern transport solution. Carelse says, “The new model provides customers with modern transmission technology, smoother operation and longer service intervals. We are aiming to introduce innovative ways in which we can go the extra mile for our customers.” UD Trucks is using a 2500 TC221 P&D Allison transmission in the range and it is incorporated into the UD 90 at its assembly plant in Rosslyn. Allison is one of the world’s premier providers of automatic transmissions for commercial vehicles and is renowned for its quality and reliability. States Carelse, “The main benefits of using a torqueconverter gearbox include improved performance and more efficient fuel consumption. Ultimately, its means more savings for our UD fleet owners.” Efficient acceleration is achieved by the torque converter that utilises full power shifts and subsequently less fuel. Optimal cruising is also achieved by means of the lock-up clutch and advanced electronic controls, which optimise the powertrain and fuel consumption. Better engine braking is also achieved through the torque converter and pre-select function, reducing brake wear and fuel consumption. Advanced electronics also add to the overall savings of the drive cycle. This includes reduced engine load at stop, or RELS, and auto-neutral that minimises the truck’s fuel usage during idling. Load-based shift scheduling automatically selects the optimum shift schedules based on the vehicle’s actual payload and the road grade on which it is operating. UD Trucks’ HCV range provides transport solutions for nominal payloads from 6 to approximately 11 tonnes.
UD 90 ATM FREIGHT CARRIER - H09 Their optimised wheelbases ENGINE make them ideal for a range Type: UD Trucks FE 6TB of applications, which include Configuration and number of cylinders: Direct injection, turbocharged intercooled in-line 6 freight carriers that can be fitcylinder diesel ted with virtually any rear body, Displacement: 6 925 cm3 Maximum power output: 175 kW@ 2 800 r/min a dedicated tipper as well as Maximum torque: 660 Nm @ 1 800 r/min conversions to truck-tractors. Governor type: RED electronic (all speed) Tag axle options allow for CLUTCH Type: Borg & Beck CL 810 380 mm single dry operation as a 6x2 with addiplate tional payload capability. Operation: Boosted hydraulic with automatic Adds Carelse, “With its provadjustment Disc diameter: 380 mm en flexibility and superb duraFriction area: 1 194 cm2 bility, the UD Trucks Heavy TRANSMISSION Commercial Vehicle range is Make: Allison Type: 2500 TC221 P&D ideally suited to meet customBRAKES ers in this market segment’s Service brakes: Dual-circuit air-assisted hydrauexacting requirements. lic drum brakes all round Emergency/Parking brake: Spring brakes on “The UD Trucks managerear axle ment team is extremely excitEngine brake: Remote-mounted exhaust brake ed about the future of the with lever switch on steering column Total brake lining area: 4 544 cm2 brand in this country.” WHEELS AND TYRES Concludes Carelse, “As one Rims: 7.5 x 22.5 single piece steel disc of the country’s leading truck Tyres: 11R22.5 -16 PR tubeless radial highway pattern all-round manufacturers for the past 50 Spare wheel: Slung from a winch-type carrier years, the company is curunder rear of chassis rently planning the introducFRONT AXLE Type: FA50 drop forged I-beam with reverse Elliot tion of game-changing new steering knuckles products and services to Suspension: Semi-elliptic steel leaf springs with customers. dual-acting telescopic shock absorbers “The future plans of UD Trucks are all about enhancing our customers’ transport and service experience with us, and we believe the introduction of the UD 90 ATM is one of the ways in which we are providing customers with appropriate Jacques Carelse, technology at the MD, UD Trucks right time.” Southern Africa
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COMMERCIAL VEHICLES
Connecting transporters and loads in the SADC region
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NEW INTERACTIVE web and mobile interface has been launched, providing a solution to manage shipment and transport needs. According to Mark Goodger, acting CEO of GMLS South Africa, “LoadSmart is a websitebased networking platform developed by PROSADC in cooperation with GMLS South Africa, dealing with the needs of Southern Africa’s freight transportation industry. “As a marketplace for networking transporters, logistic operators and freighters, the company aims to deliver a better end-to-end support service that shipping agents,
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TWA | Jul/Aug 2014
transporters and freight forwarders can benefit from, ensuring an improved goods circulation and day-to-day trade in Southern Africa.” Applicants are screened to ensure that only the most reliable transporters are members of the company. Being a member of the network offers several benefits, which, according to Goodger, include genuine contracts and loads, trustworthy and safe transporters, chances of increased trips for transporters and lower taxes for freight forwarders. Website users can see available loads, post loads, view available vehicles and post vehicles. “LoadSmart will cover all the logistic corridors in Southern Africa. Our aim is to create opportunities for businesses that are looking for contracts or loads for their vehicles, as well as for customers who have contracts or loads that require vehicles for transportation to connect,” Goodger concludes. For more information, please feel free to visit www.loadsmart.net.
COMMERCIAL VEHICLES
Holding the fort in Botswana T HE COMPANY OFFERS complete transport solutions being vehicles, parts and servicerelated products as well as finance and insurance in the heavy transport industry for vehicles above 16 500 kg; including trucks, buses and luxury coaches. Apart from providing transport solutions, the company also supplies and delivers engines that are being used for power and pump generators. “Through the Scania-approved concept, used vehicles from the region as well as Europe are being re-marketed and delivered to customers in Botswana together with the used truck’s warranty, finance, insurance and R&M contracts.” With two depots conveniently located in Gaborone and Francistown, customers are given a wide range of products and services, handled and delivered professionally with factory approval. “Services include repair and maintenance work, as well as driver and operator training. Stock of vehicles and parts are kept, and all products on offer are covered by the Scania warranty. “The most critical factor to customer satisfaction is not only receiving the end product, which is the vehicle or generator, but it is about complete and overall customer satisfaction inclusive of after-sales service provision. In this regard the company offers a 24/7 road-side assistance service together with a 24-hour towing service to assist all Scania customers operating within Botswana. “ “It is a priority for us that the customer knows he can rely on us. We want our customers to focus mainly on their core business whether it is distribution or long haulage or within the mining sector.”
Scania has been operating in Botswana since 1981, with Scania Botswana being the sole authorised distributor for Scania products in the country. Simon Foulds speaks to Frederick Hennop, Scania Botswana CEO, to find out more about the operations in Botswana.
has an active HIV/Aids wellness committee and active and trained HIV/AIDS workplace peer educators to support the staff complement.” A conducive environment has been created for any workers living with HIV or Aids. Frederick Hennop, CEO, “We even have our own HIV/Aids chamScania Botswana pions in the workplace who serve as great peer educators for the other staff. Our in-house driver trainer, who has access to our clients in our supply chain, now has the benefit of distributing information buddy packs, which he uses to share with our clients and hence continues to spread the message of good health choices. When the employees are healthy, the company is also healthy.” The company is owned by Scania South Africa, which is a wholly owned subsidiary of Scania CV in Sweden.
“We want our customers to focus mainly on their core business”
Scania Botswana services and products www.scania.co.bw • t +26 (7)391 2244 (Gaborone)
Scania offices in Gaborone, Botswana
HIV/Aids Due to its location in Southern Africa, a region that carries the highest rates of HIV/Aids infections globally, the company is cognisant of the impact the disease could have on its business operations and most importantly on its human resource. In Botswana, as is the case with countries like South Africa, Zimbabwe, Namibia, Tanzania and Zimbabwe, there are high rates of HIV infection. “We have been proactive towards HIV/Aids prevention, treatment and care over the past eight years. Thanks in part to the guidance and support of the Swedish Workplace HIV/ Aids Programme. The company now
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FLEET OPERATIONS
Vehicle load limits and dimensions
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RANSPORTERS MOVING freight through both the SADC and COMESA regions should take note of the latest schedules of load limits and dimensions permitted within the member states.
These are the latest schedules provided to TWA by FESARTA. It is important to note that in South Africa, Botswana and Mozambique no allowance has been made for trucks with bull bars in relation to vehicle combination length.
2.5 2.5 2.65 2.6 2.5 2.5 2.6 2.65 2.6 2.5 2.6 2.5 2.65 2.65 2.6 2.65
4 4.1 4.2 4.1 4.6 4.3 4.3 4.2 4.3 4.1 4.6 4.3 4.6 4.6 4.3 4.6
22 20/22 22 22 22 22 22 22
15 12.5 12.5 12.5 12.5 12 12.5 12.5 12.5 12.5 12.5 12.5 12.5 12.5 12.5
15 12.5 12.5 12.5 12.5 12 12.5 11 12.5 12.5 12.5 12.5 12.5 12.5 12.5 12.5
Semi-trailer length
Height
18 17 17 17 17 16.5/18 18.5 17.4 18.5 17 17 2 18.5 18.5 18.5 17
Trailer length
Width
20 22 22 22 20/22 22 22
Rigid vehicle length
Articulated vehicle length
Angola Botswana Kenya Lesotho Malawi Mozambique Namibia Rwanda South Africa Swaziland Tanzania Uganda Zambia Zimbabwe SADC COMESA
Vehicle combination length
Country
FESARTA VEHICLE DIMENSION LIMITS
15 12.5 12.5 12.5 12.5 12 N/A N/A 12.5 12.5 12.5 13.5 N/A N/A 12.5
FESARTA VEHICLE COMBINATION AND AXLE/AXLE UNIT LOAD LIMITS
SADC
8
8
COMESA
8
8
8
16 16 12 14 12 18 Not listed Not listed
18 24 24 24 24 24 21 15 24 18 12 24 Not listed Not listed
24 24 24 24 24 24 24 24 24 24 24 24 24 24 24
38 56 53 48 56 56 56 56 53 56 56 56 56 56 56
10
16
18
24
24
56
10
16
18
24
24
56
Allowance
385 super-singles
Six standard wheels 24
Combination
8 8 8 8 8 8 Not listed Not listed
16 18 16 16 18 18 18 18 16 18 18 18 16 18 18
Vehicle Dual wheels
7.7 7.7 8 8 8 8
16 16 12 15.4 16 16 16
Tridem Axle Unit Dual wheels
8 8 8 8 8
385 super-singles
8 7.7 8 8 7.7
10 9 10 10 9 10 9 9 10 9 9 10 10 10 10
Four standard wheels
8
Tandem Axle Unit Dual wheels
6 8
385 super-singles
Two standard wheels
Angola Botswana Burundi Kenya Lesotho Malawi Mozambique Namibia Rwanda South Africa Swaziland Tanzania Uganda Zambia Zimbabwe
Steering two wheels
Country
Single Axle
5% 5% 5% 5%/10% 2%/5% 5% 5% 2%/5% 5% nil 5% nil/5%
These documents are the property of FESARTA and may not be reproduced without prior consent
TWA | Jul/Aug 2014
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SUPPLY CHAIN LOGISTICS
Improve profit margins and free up working capital Simulations in a range of industries have shown that Cargo Carriers’s Symphony software reduces both overstocking and lost sales through stock-outs. Simon Foulds speaks to Dawid Janse van Rensburg of Cargo Carriers to find out more about the software. TOP Dawid Janse van Rensburg, Cargo Carriers divisional director: IT and supply chain
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INCE THE ECONOMIC downturn of 2008, companies determined to remain sustainable have had to embrace a number of innovative strategies to maintain profit margins,” says Janse van Rensburg. “Supply chain management is an area that ought to receive more attention, because efficient control of stock, to avoid both overstocking and stock-outs, makes an immediate difference to both the balance sheet and the income statement.” He has good evidence to back up that belief; over the past few years, Cargo Carriers has run pilot simulations using the Symphony software system on several companies, in sectors as diverse as minerals, retail clothing, foodcontainer manufacturing, hardware, and wine distribution. In all cases, the simulations showed that dynamic buffer management of the inventory in supply chains improves profitability – sometimes in ways the client had not even considered. “We pick a sample selection of their product lines, and we need the stocking and sales data for those lines going back a full year, then we input all that data and run the
The programme has an algorithm that allows us to put an actual monetary value on sales that are lost due to stock-outs
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TWA | Jul/Aug Mar/Apr 2014 2013
simulation for a period of one year, tracking the performance of the simulation against actual results achieved by the company running its supply chain as usual. We recently worked with a large wine distributor and before we started, their main worry was stock-outs on popular lines; they weren’t really concerned about overstocking. But remember, this is a cash-to-cash business; they only get their money when they sell the wine. So having stock in the warehouse that isn’t moving is simply taking up space without making any return. In the meantime, another line is experiencing high demand; but you don’t have enough space to store it do you hire more warehouse space? It’s much more costeffective to make sure your warehouse isn’t full of stock you don’t want or need. Apart from anything else, it frees up working capital that would otherwise be locked up in unsold stock.”
Revealing the actual value of lost sales “The programme has an algorithm that allows us to put an actual monetary value on sales that are lost due to stock-outs. In the wine distributor’s case, they were quite surprised to see that they were losing a lot more sales to stock-outs than they had thought. Using Symphony, they can ensure they have the optimal mix in the warehouse at all times. It lets you see the cost of holding inventory per sale, the amount of inventory held per unit of sale, the amount of stock reduction you can achieve, and helps reduce the sales lost through stock-outs.” The results of the pilot simulations speak for themselves – in the case of the food-container manufacturer, the stock-out days in the simulation were 84% lower than the company’s actual results using its current system. Across the board, the simulations resulted in lower levels of inventory – a saving on warehousing costs and a boost to working capital – but still showed increased turnover and a reduction in stock-outs. It’s clear that dynamic buffer management of supply chains is one of the simplest but most effective ways to increase profit margins.
SUPPLY CHAIN LOGISTICS
Critical area of growth Opportunities abound in Africa but it is essential to understand local context and adapt your business model to suit the demand and demographics of each country.
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HIS IS THE VIEW of Eqstra Fleet Management who, along with Unitrans and BDO, jointly undertook research in 13 African countries (Algeria, Angola, Botswana, Cameroon, Cote d’Ivoire, Ghana, Kenya, Mozambique, Namibia, Nigeria, Senegal, Uganda and Zambia) in order to provide corporates with information and a general benchmark on how business travel- and vehicle-related tax is currently being treated in these respective countries. Murray Price, MD, Eqstra Fleet Management, says, “A common mistake by the early corporate ‘pioneers’ has been to treat Africa as one single entity and to adopt a single strategy and approach to each African country they targeted. However, corporates have now realised that expansion into Africa requires not just the right resource or product but critically, the right information and partners. Our research is aimed at providing corporates with the right information to inform travel and logistic strategies from a fleet perspective.” Challenges in doing business in Africa include underdeveloped financial sectors, complex legislative regimes (over 55 countries), political stability, access
finance options, but the availability of contract hire and leasing options remains low.” Executives enjoy the greatest access to company vehicles, with 27% of vehicles operated as perk vehicles for management whereas 24% of the fleet is being utilised for moving goods. On the whole, most corporates favour paying an allowance to their employees rather than providing a company vehicle and less than 40% of the sample offer their management the option of a company car. The majority of fleet owners maintain their vehicles through the respective manufacturer or dealer network. The use of fleet cards to pay for maintenance is not a preferred option in African markets. Some 62% pay for maintenance-related costs via accounts, while 23% pay in cash. Only 5% make use of a fleet card option. Local service providers are used by the majority for
Our research is aimed at providing corporates with the right information
to skilled resources, public and private cooperation and poor infrastructure. The research targeted 135 medium-to-large companies across the 13 countries, with the countries being chosen based on their GDP growth potential and on existing client demands. The research sample at the time of the study operated between them 39 000 vehicles. Responses were received from all the major sectors, with the majority from the manufacturing, processing and distribution, transport and logistics industries. Adds price, “While not a representative sample, this is the first study of its kind and provides a strong base for future research and further information gathering.”
Overview of the African market The research found that fleet management solutions and funding options are not readily available in all countries. The report estimates that 42% of the corporates purchase all of their fleet using their own cash reserves. Then 25% of companies purchase a large portion of their fleet paying in cash, with only 33% of corporates relying predominately on external funding to finance their fleet. Price states, “We believe the sway towards outright purchase is not always by choice, but that outsourced solutions available in South Africa have not been developed for the rest of Africa. Granted, the banking sector provides finance and lease and hire purchase options in most of the countries, and certain manufacturers are now starting to offer
please supply pic and caption
tyre repairs and replacement – as much as 19% of respondents indicated that they prefer to procure tyres in bulk and manage their own tyres in-house. Companies operating in Africa appear to have minimal control over their fleets. While the majority (58%) have installed some type of tracking solution, most admit to not having control or reporting to manage driver behaviour and fuel expenses. Concludes Price, “It is evident that very few companies across Africa make use of an integrated fleet-management or logistics solution. Case studies and research have proven that by consolidating all fleet-related services for a single combined overview, companies are able to reduce their fleet costs by as much as 30%. This can however only be achieved if there are sufficient providers available.”
From left: Abel Myburgh, BDO South Africa Advisory Services; Hein du Plessis, Eqstra Fleet Management; Ray Singh, MD Unitrans; Murray Price, MD Eqstra Fleet Management
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SUPPLY CHAIN LOGISTICS
Becoming demand driven Globally, supply chains are becoming more complex as companies struggle with the increased difficulty of planning and managing. TWA attended SAPICS 2014 where Carol Ptak, an expert in demand-driven planning and coauthor of numerous publications, outlined why most demand and supply planning systems deliver poor results. WHAT ARE WE MISSING ABOUT SUPPLY CHAINS?
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ODAY, TOO MANY people think of supply chain tools as advanced planning and scheduling systems, warehouse management systems, product life-cycle management or logistics management packages. This is a mistake. What really drives supply chains? The heart of any supply chain is an interconnected network of ‘islands’ of manufacturing. At the heart of these islands is something called materials requirements planning (MRP). MRP creates and connects the demand signals in the ‘archipelagos’ that comprise most supply chains.
enabling this agility and in fact have embedded rules that are antithetical to flow. No matter how much money you spent on your ERP product, your planning system is antiquated and fundamentally broken with respect to enabling flow and agility required in today’s supply chains. What gets put on lathes, welding jigs, assembly lines, trucks, boats and aeroplanes is a response to a demand or supply-order generation signal. Today, due to the increasing complexity of the global manufacturing and supply landscape, the supply-order generation signals that move down through our supply chains have become more and more out of alignment with actual demand. This is referred to as the bullwhip effect. The bullwhip effect has been well understood for quite some time, however the problem is growing worse. The bullwhip effect kills flow and supply chain agility in its unpredictability and amplitude of variance. Why does this bullwhip effect exist? The traditional planning rules and tools including forecast-based demand generation employed by most manufacturers and distributors do not fit the highly volatile and variable world we live in today. Those rules were constructed under a ‘push and promote’ mentality fuelled by production efficiency, utilisation metrics and a market that was more tolerant of longer lead times and shortages.
The new normal
However, in order to improve flow and achieve more agility throughout supply chains, we must seriously reexamine the conventional materials-planning and -execution methodologies. Achieving improved flow is not just about speeding up the antiquated rules and tools that we already have but rather embracing a fundamental shift in how companies manage their supply chains. Today, almost every mid-range and large manufacturing company is using MRP methods and tools that are not
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The 21st century is a highly volatile time. Customers demand shorter lead times, more variety and customisation. The CFO demands significant reductions in working capital. The Internet has reduced transactional friction and competition can now come from anywhere on the planet. Supply chains are extended, more difficult to manage and vulnerable to disruption. The net effect of all of this is that today companies are dealing with more complex planning and supply scenarios than ever before. This is not a temporary phenomenon; it is here to stay. The traditional MRP rules that were conceived, codified and commercialised in the 1950s to 1970s under the old ‘push and promote’ mode of operation are now breaking down. Driving the master schedule from a forecast results in the factory building to the plan but with a high probability of not building what the customer can and will buy. The industry continues to pursue better algorithms in search of
SUPPLY CHAIN LOGISTICS
in a volatile world business performance improvement. Working to forecast has long been compared to driving a car by looking in the rear-view mirror. Today, however, we are more likely driving on a narrow mountain road in dense fog. The penalties for error are significant, even catastrophic. Paying large sums of money for more sophisticated forecast algorithms simply means you now have a more expensive rear-view mirror. Any appreciable gains by these ‘smarter’ algorithms are being more than offset by the rise of volatility, and the risk still continues to increase.
The compromises and effects This incredible pressure has forced companies into less than acceptable alternatives. In November 2009, the Aberdeen Group released a survey that showed that on average 71% of ERP users were using spreadsheets for demand management rather than their ERP’s planning module. Planners fundamentally distrust the signals they get from their integrated planning systems. Utilising the ease to export data, planners have built workarounds
and ad hoc mechanisms in order to get a perception of relatively better approximation of real requirements. These tools have limited capability, scalability and transferability. These antiquated rules, tools and ad hoc systems lead to a combination of three costly undesirable effects in today’s environment: • Poor inventory performance This is characterised as having too much of the wrong products while, at the same time, having too little of the right products. Inventory is waste only under two conditions. First, waste is significant when there is too little inventory – it translates directly to missed sales, production disruptions and expedites. Second, the classic definition of waste is when there is too much inventory – excess working capital and capacity are tied up in things that are not required. • Poor service levels This is characterised by unacceptable fill rates and missed sales. Most companies recognise the high penalty associated with missed sales. They pay a premium in terms of
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SUPPLY CHAIN LOGISTICS inventory (having too much) or expedites (having too little) in order to prop up service levels with today’s inadequate planning, execution and tools. Unfortunately, many companies still have high inventories and lots of expedites and still cannot meet their service targets – even on products shipped to mature markets. • High expedite-related expenses This is often under-measured and underappreciated. This expense includes all of the additional effort and money that we employ to make up for shortages in the face of critical service requirements or targets including expedited freight. Additional freight cost is incurred because only partial shipments were available. Overtime employed after late components have arrived or scheduled break-ins in high set-up cost environments add to this expense.
Where do we go from here? These problems are not going away. Large ERP providers are focused on infrastructure, not business application development. Furthermore, the technical magnitude of the problem combined with the direction of the solution leaves a very small group of people with the relevant experience and knowledge to reconstruct the rules and specify the tools. Demand-driven MRP (DDMRP) is a multi-echelon demand-and-supply planning and execution methodology. Multi-echelon means that DDMRP integrates multiple tiers (including the bill of material) in the supply chain in order to provide end-to-end planning and execution visibility so that flow can be improved and better managed. DDMRP ends the typical bimodal distribution for the parts/SKU that matter and brings inventory into the desired alignment. At its core, DDMRP uses a new type of strategically positioned and dynamically managed stock positions to dampen variability, compress lead times and reduce working capital requirements while ensuring unprecedented levels of service. These strategic stocking positions dramatically alter the planning and execution rules of conventional MRP. In most manufacturing environments, inventory stock in some form is a requirement. Customers will no longer tolerate long lead times. However, most manufacturing companies and certainly every supply chain cannot be a pure make-to-order system. Holding inventory is a reality in the modern world. In most cases, companies cannot position and manage stock positions effectively because they have only antiquated stock practises and tools. At the same time, it is also extremely wasteful to not carry inventory. When companies lean out too much inventory, then frequent shortages can result. When companies experience shortages, they are forced to spend additional time, effort, money and capital in order to resolve the problem and significant market opportunities can be missed. This is a significant source of waste. Agility is not synonymous with zero inventories. The key to effectively leveraging the working capital and capacity commitment inherent in inventory is to find the places where that inventory can make the biggest impact and therefore provide the greatest return. Inventory can decouple otherwise dependent events so that the cumulative effects of variation are not passed and/or amplified between the
dependencies. Inventory can be a breakwall against the variability experienced from either supply (externally and internally) or demand variability. But, like any breakwall, they are only effective if placed and sized properly. Thus, the first question to ask is, “Where?” and then the second question of “How much?” can be answered. Today, companies must think systemically across the supply chain and not just within their own four walls. Putting inventory everywhere is an enormous waste of company resources. Eliminating inventory everywhere puts the company and supply chain at significant risk. Strategically positioning inventory ensures the company’s ability to absorb expected variability with the smallest possible investment. Unfortunately, today, most tools, training and educational material is oriented towards deterTHE CRITICAL mining the answer to the questions, “How POSITIONING FACTORS 1. Customer Tolerance Time much?” and, “When?”, with little to no attention The time the typical customer to answering, “Where?”. Properly determining is willing to wait. where to place inventory is a strategic question 2. M arket Potential Lead Time The lead time that will allow that should involve key personnel representing an increase of price or the a relevant cross section of the company. There capture of additional business are six critical positioning factors in determineither through existing or new ing where to properly place inventory. The six critical positioning factors (as seen on the right) must be applied systematically across the entire bill of material, routing structure, manufacturing facilities and supply chain to determine the best positions for purchased, manufactured and finished items (including service parts). The bigger the system these factors are applied to, the more significant the results can be. After the initial positions are determined, new innovations with regard to sizing stock levels, replenishment rules based on actual demand, and judging execution priority take over. Below is the complete DDMRP methodology. These steps are in prerequisite order. • D emand-driven material requirements planning. • Strategic inventory positioning. • Buffer profiles and levels: - dynamic adjustments - demand-driven planning - visible and collaborative execution - modelling/remodelling the environment plan.
customer channels.
3. V ariable Rate of Demand The potential for swings and spikes in demand that could overwhelm resources (capacity, stock, cash, etc.). 4. Variable Rate of Supply The potential for or severity of disruptions in sources of supply and/or specific suppliers. 5. I nventory Leverage and Flexibility The places in the integrated BOM structure (the Matrix BOM) or the distribution network that leave a company with the most available options as well as the best leadtime compression to meet the business needs. 6. The Protection of Key Operational Areas It is particularly important to protect critical operational areas from disruption. These key operational areas do not necessarily need to be a bottleneck operation.
DDMRP solution summary and case studies DDMRP is an unprecedented no-compromise fusion of relevant MRP and DRP tactics combined with the pullbased approaches and signals of lean and the theory of constraints while mitigating the variability well understood through Six Sigma. DDMRP includes planning and execution innovations for better lead-time compression and execution visibility. Leveraging lean’s waste reduction focus and visibility for execution, the DDMRP methodology combines it with a new set of demand-driven planning tactics that provides unprecedented planning visibility across an enterprise and supply chain. Adopters of the DDMRP methodology have realised significant results without compromise of desired improvements.
THE EXPERT
CAROL PTAK is an internationally recognised authority in the use of ERP and supply chain tools to drive improved bottomline performance
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CORRIDORS
Walvis Bay Corridor Group Created as a service and facilitation centre to promote imports and exports via the Port of Walvis Bay for the SADC region, the Walvis Bay Corridor Group (WBCG) has grown from strength to strength. Simon Foulds speaks to Johny Smith, CEO of WBCG, to find out how businesses benefit from the WBCG. 28
TWA | Jul/Aug 2014
CORRIDORS
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aimed at improving road safety and security along both the Trans-Kalahari and Trans-Caprivi corridors.” The aim of the latter initiative according to Smith is to support the regional authorities along these routes with continually developing safe, sustainable and secure corridors.
Public-private partnerships
Development Namibian logistics hub
HE GROUP’S MAIN competitive strength is its public-private partnership (PPP) set-up of transport and logistics stakeholders from both the public and private sector. This, according to Smith, allows for the pooling of resources, expertise and authorities from both the regulators and operators.
“Due to WBCG’s constitution as a PPP, we are able to lean on the public sector for advice and action on issues such as customs, transport regulation and infrastructure development, while the private sector can focus on business development such as marketing and making practical operational proposals and logistics solutions,“ says Smith.
Advantages for the region The Walvis Bay Corridors are a network of transport routes. “The key elements are the Trans-Kalahari Corridor, the Trans-Caprivi Corridor, the Trans-Cunene Corridor and the Port of Walvis Bay,” he states. “The deep-sea port at Walvis Bay allows for direct access to principal shipping routes and offers shippers a timesaving of up to five days between the SADC region, Europe and the Americas. Fast, efficient and safe road and rail transport along the corridors further reduce costs, making the regional economy more attractive to global players as envisaged under the NEPAD initiatives.” According to Smith, regional support ensures harmonisation of standards allowing for the smooth flow of trade between borders. This has been further enhanced through the establishment of regional committees and partnerships along the respective corridors. Adds Smith, “The Trans-Kalahari Corridor management committee initiated the Trans-Kalahari Corridor secretariat, which is a body made up of government and private sector representatives from Namibia, Botswana and South Africa. “The Walvis Bay-Ndola-Lubumbashi Corridor Management Committee, which is a partnership between the DRC, Namibia and Zambia, was also established to address challenges along the Trans-Caprivi Corridor.
Support services “Our strategic plan for 2010 to 2015 has been focusing on efforts to increase cargo volumes for both the Port of Walvis Bay and the WBCG, as well as enhancing the competitiveness of the corridors,” says Smith. “To support this, we established a portfolio for projects and funding to identify, formulate and manage corridor projects. “The Walvis Bay Corridor Group Wellness Service Programme is proactively involved in mainstreaming the HIV/Aids epidemic. We assist transport companies in Namibia to design and implement workplace HIV/Aids wellness interventions. “The programme also focuses on developing and communicating a clear workplace policy, peer education, access to voluntary counselling and testing for the Namibian transport sector. “A joint initiative programme – the Safe Trade and Transport Corridor Programme – between the WNCG and the Swedish International Development Agency (Sida) is
The logistics hub concept forms part of the greater efforts of the Walvis Bay Corridor Group to develop the Walvis Bay corridors as the preferred trade route for Southern Africa. Chairman of the Walvis Bay Corridor Group Bisey Uirab says, “Africa is expected to be the fastest growing region after Asia, with sub-Saharan Africa expected to grow by 5 to 6% between 2011 and 2020, hence ‘trade opportunities abound on our doorstep and we must seize the day as now is the right time to grab these opportunities’. Our logistics hub provides a seamless transport and logistics solution to ensure that these potential consumers get their goods at
the right time and in the most costeffective manner. “The competitive advantage of Namibia is our strategic geographical position to serve Southern Africa; that we are a peaceful and secure country; that we have a government that is supportive and also wholly committed to development and growth; that our institutions are sound; that our services are relatively efficient; and that we have a generous amount of land for industrial development and inland logistics hubs. “We should capitalise on this competitive advantage by making sure our infrastructure (port, rail, road, etc.) has the capacity to handle the demand – now and in the future. We need to develop ahead of demand so that we can be a few steps in front of our competitors to capture emerging business opportunities; making sure we modernise and transform our modes of transport as well as infrastructure (including ICT) so that they complement each other to provide a seamless cost effective service and pushing for non-tariff barriers in the region to be reduced and making sure our nation realises its dream of industrialisation as enshrined in Vision 2030. “We urge the transport community to cooperate and commit to driving the logistics hub as a matter of priority so that we can make Walvis Bay the Singapore and Dubai of Africa by 2030. Ultimately, the development of the Port of Walvis
The Walvis Bay corridors are a network of transport routes
TWA | Jul/Aug 2014
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4
CORRIDORS Bay and the Walvis Bay corridors is clearly an advantage to accelerate growth for Namibia and the SADC region by offering Southern Africa an alternative gateway. “The role of transport and logistics has become increasingly important to accelerate the growth of Namibia’s economy and, with the rapid growth in cargo volumes along the Walvis Bay corridors through the port of Walvis Bay and the benefits that the trade routes have to offer, Walvis Bay has been identified to become the logistics hub for Southern Africa.”
Trans-Caprivi Corridor This corridor provides the shortest route between Walvis Bay and the transport hubs of Livingstone, Lusaka and Ndola in Zambia and Lubumbashi (in the southern DRC) as well as Zimbabwe. It is also well positioned between the SADC region and Europe, North and South America as well as the emerging Far East markets.
Trans-Kalahari Corridor Linking the Port of Walvis Bay to Botswana’s capital, Gaborone, and the industrial heartland of South Africa, Gauteng, as well as Zimbabwe,
it is perfectly positioned to service the region. The infrastructure supporting the corridor boasts the most efficient intermodal blueprint for the region incorporating the ports, air, tarred roads and rail networks, as well as automated border post customs procedures. It allows for a 48-hour transit to and from Gauteng.
Trans-Cunene Corridor Linking the Port of Walvis Bay to Lusaka in Angola (via Tsumeb and Ondangwa to Oshikango in Namibia) and the Santa Clara border post in Angola, it is positioned to service two-way trade between Angola, Namibia and South Africa with Europe, the Americas and the Far East.
Trans-Oranje Corridor This tarred road links the ports of Walvis Bay and Luderitz with the Northern Cape in South Africa. The corridor is complemented by a railway line from the Port of Luderitz extending southwards to the Northern Cape via Upington. This corridor allows for a 48- to 72-hour transit to and from Johannesburg.
Our strategic plan has been focusing on efforts to increase cargo volumes for both the Port of Walvis Bay and the WBCG TWA | Jul/Aug 2014
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SEA FREIGHT
Port of Walvis Bay Namibia’s largest commercial port, Walvis Bay, is a natural gateway for international trade. Strategically situated in the central coastal region of Namibia, Simon Foulds speaks to Namport’s Cliff Shikuambi about what the port offers as an alternative route to accessing principal shipping routes.
T
HE PORT RECEIVES approximately 4 000 vessels annually with its container terminal accommodating ground slots for 3 875 containers with provision for 424 reefer container plug points. The container terminal can host 355 000 containers per annum and there are plans to expand this terminal.
Key benefits of using the Port of Walvis Bay “The port is secure, efficient and world class,” says Shikuambi. “The turnaround time is competitive, with handling times for container vessels of around 12 to 15 hours. “Depending on the tonnage and shipment, the turnaround time for bulk vessels averages between 24 and 48 hours, while for bulk-break vessels it averages between 18 and 20 hours.” Further to this, he says the port
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TWA | Jul/Aug 2014
SEA FREIGHT
MAIN FEATURES NEW CONTAINER TERMINAL
is congestion free with minimum delays. The port currently handles seven million tonnes per year with its total capacity equipping it to handle eight to nine million tonnes of cargo. “The port prides itself on delivering an increasing demand for customer services and it has world-class infrastructure and equipment, ensuring reliable and safe cargo handling.” Shikuambi adds that temperate weather conditions are experienced all year round and no delays are caused by the weather. Maximum security measures and procedures are in place and it is compliant with the International Ship and Port Facility Security Code. “Deep water anchorage is available inside the port which is protected by a natural bay and another plus is the low risk in respect of insurance with no pilferage,” states Shikuambi. “Another advantage for port users is that the routes
managed by the Walvis Bay Corridor Group make access to the hinterland easy and fast. The Gauteng market can be reached via the Trans-Kalahari Corridor instead of going via Durban or Cape Town, saving between 7 and 11 days in transit time. “The port is also served with trade routes from South America, the Far East, Europe, North America and the Middle East. “Transit time from Antwerp to the port is only 17 days.”
Mega projects To attain its vision of being the best performing world-class port in Africa, Namport is embarking on numerous mega projects at Walvis Bay. The projects include a new container terminal along with a SADC Gateway Port to increase the capacity of the port.
• 40 hectares of new land for the construction • 600 m of quay length to the existing 1 500 m • 650 000 TEU capacity per annum up from current 350 000 • cost approximately NAD 3 billion • creates additional capacity for all port businesses to expand. MAIN FEATURES SADC GATEWAY PORT • total of 1 330 hectares of port land (105 ha current port) • 10 000 m of quay walls and jetties to yield approximately 30 large berths (current port 1 500 m of quay walls) • world-class ship and rig repair yard plus an oil and gas supply base • huge covered dry bulk terminal • car import terminal/ro-ro terminal • container terminal (if needed in the future) • liquid bulk terminal with very large crude carrier berths • m ultipurpose and breakbulk terminals • backup storage areas/dry ports • new high-capacity rail, road, pipeline and conveyor link to the area behind Dune 7. MAJOR IMPROVEMENTS • T o accommodate bigger vessels like the WAFMAX and others in the same category, the port underwent the following major improvements: • the extension of the main entrance channel from 4.5 nautical miles to 5.2 nautical miles. • deepening of the main entrance channel, turning basin and adjacent berths # 1-3 for the container terminal from -12.8 m chart datum to -14 m • the expansion of port limits further north to improve on port security • the installation of a state-of-the-art port surveillance system commonly known as the VTS to monitor traffic movements in the wake of increased traffic movements due to a growing ship and rig repair industry • new paper and electronic charts for electronic chart display systems (ECDIS).
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AIR CARGO
Driving force in moving freight A IRLINK CARGO, a division of SA Airlink, provides air freight transport to more than 30 destinations across Southern Africa. It offers a direct air freight service within South Africa and to international airports such as Botswana, Zambia, Zimbabwe, Mozambique, Madagascar, Lesotho and Swaziland. The diverse network of Airlink Cargo within South Africa comprises flights to Polokwane, Nelspruit, Phalaborwa, Skukuza, Richards Bay, Umtata, Durban, Bloemfontein, Kimberley, Upington, Cape Town, Port Elizabeth, East London and Pietermaritzburg.
African market Says Rautenbach: “The market has seen a tremendous increase in growth into Africa in the past few years. We have a direct service most days of the week into the continent, providing customers with consistent, timeous and sufficient connections to support the growth of the African market. At the same time, the nature of Johannesburg being the cargo hub in Africa has changed as more international carriers are starting to fly direct to certain airports.
Air cargo worldwide transports goods worth in excess of $6.4 trillion on an annual basis, which is approximately 35% of world trade by value. Simon Foulds speaks to Alwyn Rautenbach, executive manager: Airlink Cargo, to find out how the company contributes to moving freight across Africa.
Future operations “We are very optimistic about future operations as we are growing with the market by introducing new destinations into our network regularly. Some of the most recent additions into our network is the introduction of two daily flights between Johannesburg and Gaborone, four daily flights between Johannesburg and Bloemfontein, two daily flights between Johannesburg and Kimberley and the opening of the Skukuza Airport with daily flights from Cape Town and Johannesburg.
Increasing inter-African trade “In some African countries, governments are still very involved with air carriers and their operations by preventing foreign carriers to compete in their country. Once fair competition is granted, increased trade will follow. “Currently there is a much higher trend in imported goods rather than exported goods within some African countries. African countries will therefore also have to focus more on the development and growth of agricultural products to export goods in order to have equilibrium between imports and exports within these countries. There is also still a lack in the number of reputable international freight forwarding and courier companies to stimulate the growth of air transport within Africa and to deliver a seamless logistics chain.
Growing the economy “Air freight plays a big role and facilitates trade intra-Africa as it provides a good transport infrastructure solution where
goods can be transported between two or more countries in a timeous manner.
Air as opposed to road and rail “Air freight transport provides one with a quick and efficient solution to send and receive goods, especially into and from areas where the infrastructure to utilise an alternative transport modus is not as accessible and practical to use. The advantage of utilising air transport with a distribution network such as Airlink Cargo is it provides its customers with a wide variety of different options to either send cargo point to point or to connect cargo between African countries, or from African countries to international destinations, by utilising Johannesburg as the hub.”
TWA | Jul/Aug 2014
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FUEL
SYTHETIC OIL
Enhance your bottom line
When it comes to keeping your fleet working efficiently, protection across the driveline is crucial. High-performance lubricants – based on synthetic technology – offer a wide range of benefits over traditional mineral-based lubricants. Raymond Abraham investigates.
E
VERY FLEET MANAGER or maintenance engineer wants to be certain that when using an oil for their fleet, it provides the right level of protection to the engine. The lubricant must reduce friction and protect the engine against acids, deposits, and wear in extreme temperatures and in a range of operating conditions. The introduction of synthetic and semi-synthetic oils represents a huge change for the heavy-duty transport industry. With advancements in engine technology, there is an increase in demand for high-performance lubricants that deliver the performanceimprovement aims of the engine manufacturers, especially regarding fuel economy. By using advanced lubricant technology developed under laboratory conditions, these oils help mitigate the risk of breakdown and keep vehicles on the road for longer. Traditionally, lubricants have been based on mineral oil, a component of whole crude oil used in thousands of everyday applications, from engines to cosmetics. Thanks to modern refining technology, today’s highquality mineral oils provide adequate protection. But mineral base oils are complex mixtures of naturally occurring hydrocarbons and may contain impurities. Synthetic lubricants contain synthetic base oils, which are made with chemicals from simpler hydrocarbon substances for excellent low-temperature flow properties, high resistance to thermal degradation
and low oil consumption. Increasingly, customers are appreciating the value that top-tier synthetic products can bring to their business, despite a higher initial cost. Benefits include: • r educed oil-change intervals • lower maintenance costs • less wear on parts.
This means more value in the long run. Advances in synthetic oil technology have delivered lubricants that offer many benefits over traditional mineral oil-based engine oils. An important function of lubrication, for example, is ensuring the engine continues to be protected under extreme temperatures, including cold starts, and at high operating temperatures. High-quality synthetic base oils are engineered for excellent low-temperature flow properties, high resistance to thermal degradation and low oil consumption. When combined with advanced additive technology, this results in products that are well placed to deliver best-in-class engine protection. Compared to some mineral oils, this means that synthetic products can help extend equipment life. The latest generation of synthetic lubricants also fulfils additional functions that can help improve cost efficiencies. Traditionally, delivering enhanced fuel economy meant lower viscosity (thinner) oils, which helped to reduce friction
Synthetic oils can last up to three times longer than regular oils, as they are designed to flow more easily at start-up temperatures
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TWA | Jul/Aug 2014
FUEL
in the engine but with the perceived trade-off of reduced engine protection. A basic understanding between synthetic and mineral oils can give fleet managers the confidence to gladly accept an oil change, which will ultimately lead to a cleaner engine that operates more efficiently, delivers more power and consumes less fuel. Synthetic oils can last up to three times longer than regular oils, as they are designed to flow more easily at startup temperatures. They are more resistant to oil degradation and protect against wear more readily. Scientists at Shell have developed heavy-duty diesel engine lubricants, which combine high-quality, low-viscosity synthetic base oils with advanced additive technology, to deliver robust fuel economy and wear-protection performance. One example is semi-synthetic Shell Rimula R5 E, which has been shown to result in 30% longer engine oil life and a 1% increase in fuel efficiency, compared to standard SAE 15W-40 oils. Fully synthetic Shell Rimula R6 LME contains high-quality synthetic base oils and advanced additive technology that instantly act when needed, helping keep equipment protected and clean. Developed in collaboration with Daimler, Shell Rimula R6 LME provides increased protection and piston
cleanliness, exceeding Daimler’s most demanding limits. Axle, transmission and gear oils also have an important role to play. Fully synthetic protection across the whole vehicle driveline can help contribute to fuel savings, when compared to mineral gear and axle oils. Shell Spirax S6 AXME – axle oil – and Shell Spirax S6 GXME – gear oil – have special frictional properties and high fluidity that reduce power loss, lower the operating temperature and offer higher mechanical efficiency. These properties can help to cut fuel costs for businesses. Selecting a high-quality lubricant is critical for businesses because providing the right level of protection helps to extend equipment life, protecting valuable assets. Under challenging conditions, high-quality synthetic base oils and advanced additive technology used in synthetic products are well placed to deliver the best all-round engine protection. As CO2 emission standards continue to be driven by regulators, engine technology advances, which places significant demand on oil manufacturers to produce more innovative and fuel-efficient lubricants. Shell has spent many years developing and understanding the science behind energyefficient lubricants and Shell’s synthetic range of lubricants is the outcome.
THE AUTHOR
RAYMOND ABRAHAM is Shell South Africa’s commercial technical manager
TWA | Jul/Aug 2014
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ADVERTORIAL
Rustenburg rapidly RUSTENBURG RAPID TRANSPORT UPDATE Initial research into how the citizens of Rustenburg felt about the city’s proposed bus rapid transport (BRT) project elicited various positive responses. “We as a community are moving together as one”; “It includes everyone”; “… We are a united city”, were some of the encouraging phrases, which inspired the project’s name, Yarona – meaning ‘ours’. There is an ever-increasing sense of pride felt by the residents of Rustenburg, as the project grows from strength to strength.
M
arketing and communication manager, Muaaz Gani concedes that there have been some delays in the past few months and, as with any project of this scale, challenges are significant but bring out the best in those working on the project. As Gani explained in a report-back meeting recently, 2013 was the year of planning, design and construction, while 2014 will be the year of intense construction, negotiations with the taxi industry and the long-anticipated launch of the new public transport brand for the system. As of the end of January 2014, R683 million was spent on the project. For 2014 to 2015, the Muaaz Gani, marketing and communications manager
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TWA | Jul/Aug 2014
budget is R900 million, followed by R1 billion the following year, though this includes the bus fleet as well. The first section of Corridor A on the R104 has been completed and construction of the Corridor B (north-east) bus lanes is under way. The locations of bus stops along feeder routes are currently being determined and, when finalised, will be shared with the public and other affected parties. Bus stops will be a combination of shelters and stops, depending on the location and needs of commuters. Work will start on the stations on the Tlhabane trunk route this year, while bus stop and shelter designs are being finalised for the feeder routes. Work on the design for depot and bus holding areas has already commenced. Importantly, more than 30% of materials, labour and supplies are being procured from local businesses. For Phase 1 and Phase 2, two depots and one holding area will be needed and a depot is planned for the CBD and Boitekong. This is close to the trunk routes in order to minimise ‘dead’ kilometres travelled by the buses.
Addressing traffic considerations, Gani said of the North West Corridor (R104): “The RRT is currently conducting traffic counts to address the traffic volume experienced this year to determine the optimum traffic flow.” As part of the recalibration of traffic signals, the right turning signal timing as experienced by road users will be adjusted accordingly. “The installation of traffic signals at these intersections has been designed to ensure a smoother flow of traffic, in anticipation of the future public transport system,” said Gani. Parking policy changes for public transport have been introduced and, with the introduction of an integrated public transport network, it was necessary to develop a clear policy around the routes and parking of private vehicles in and around where public transport is being operated. “This is both from a safety and congestion point of view to ensure passenger safety and ease of use and prioritisation of public transport,” he elaborated. Public meetings will be held in July 2014 to garner a response, but strategies to be
ADVERTORIAL
moving implemented include the protection of public mobility routes by removing on-street parking on the RRT corridors for safety and congestion. Alternate off-street options will be provided and ‘park and ride’ facilities will be promoted. People will also be encouraged to use bicycles and walk in and around the city In complying with universal access guideline principles, parking for the disabled will be dramatically increased to a ratio of one disabled bay for every 50 normal bays. Modern parking technology will facilitate improved overall management and there will zero tolerance for non-compliance and illegal parking. A freight policy is being developed to address the fact that presently road transport is the dominant means of freight movement to, from and through Rustenburg, and will continue to be for the foreseeable future. As Gani explained, “Regulating and directing freight transport around urban areas, and where public and private car transport operates, is vital.” More consultation will inform the actual details of the short- and medium-term freight plan.
• bus transition • affected routes of Bojanala/ Thari have been identified and agreed to • a n MOU has been concluded between Rustenburg and Bojanala Bus, confirming the engagement and transition processes. It is anticipated that all these processes will take another 12 months to complete.
• c ompensation negotiations with taxi industry to be completed by 2015 • there will be an overlap The spend as between compensation at the end of January 2014 and operating contract negotiations • t he contract between Rustenburg Municipality The budget for and bus operation com2014 to 2015, panies to be signed by with R1 billion 2015, for Phase 1 and earmarked for Phase 2 operations 2015 to 2016 The project’s key mile• l aunch of new public stones for 2014: transport brand • the affected business evaluation process • procurement of Phase 1 and 2, 210 bus to be completed by 2015 fleet for 2016 operations.
R683 m R900 m
Industry transition Nine taxi associations will be affected by Phase 1 and 2 of the RRT and a taxi negotiation forum has been formed from these associations to negotiate inter alia the following: • compensation • formation of the BOC • the 12-year bus-operating contract
Regulating and directing freight transport around urban areas, and where public and private car transport operates, is vital TWA | Jul/Aug 2014
39
AIR CARGO
Air freight markets in modest slowdown Data released for global air freight markets in April by the International Air Transport Association (IATA) show demand was 3.2% above previous year levels.
D Tony Tyler, director general and CEO, IATA
EMAND HAS NOT, however, grown in recent “Air cargo’s sales advantages is speed, and cummonths. Traffic levels in April were slightly bersome processes are holding us back. In March we below those of January and 1.1% lower than reached a significant milestone. For the first time, the e-Air what was recorded in March. Waybill (e-AWB) was used for over 200 000 shipments. Latest data show that prior improvements in the demand That’s good news but we still have a long way to go.” environment are experiencing some reversal. Largely as African airlines saw air cargo demand grow by 2.9%. a result of further slowdown in the emerging markets, Further growth was held back by weakness in key economostly China, indicators of business conmies in the region, such as South fidence slipped further in April. Levels Africa. Capacity rose by only 1.1%. IATA facts still point towards growth, but at the • Total market shares, in terms of weakest pace for the past five months. freight tonne kilometres by region of carriers: World trade growth has also slowed over • Asia-Pacific grew by 5.2% recent months. However, momentum in • European airlines fell by 0.7% • North American carriers grew by advanced economies remains intact, and 2.6%. export orders still point to expansion. • Middle Eastern carriers expanded by 8.7% This suggests that current sluggishness • Latin American airlines suffered a in the demand drivers is likely temporary. fall in cargo demand of 6.5% Tony Tyler, IATA’s director general and CEO says, “Trading conditions for air freight are difficult. Overall, business activity and trade have shifted down a gear after a strong end to 2013. And this is taking its toll on growth in the air cargo sector. Developed economies are still maintaining post-recession momentum and the expectation is for a stronger finish to the year.”
Export orders still point to expansion “The air cargo sector is committed to improving its attractiveness to shippers through efficiency. The goal is to reduce shipping times by 48 hours before 2020. A centrepiece of this effort is the e-freight initiative which seeks to modernize the air cargo sector with paperless business processes.”
Index to advertisers African Ports Evolution
34
Cargo Carriers
Airlink Cargo
IBC
Digicore OBC
Scania South Africa
Argus Africa Storage and Logistics 2014 37
Electra Mining Africa
30
Shell SA
Babcock (DAF)
First Automobile Works (FAW)
10
Total 16
Inter Africa
31
UD Trucks
25
Connecting Africa: Transport Infrastructure
40
TWA | Jul/Aug 2014
26
20
Mercedes-Benz OFC
Rustenburg Rapid Transport
Volvo Trucks
38-39 IFC 3 4 14
30762
to freight
freedom
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